02 Apr The Self-employment Income Support Scheme (SEISS)
The Self-employment Income Support Scheme (SEISS) will support self-employed individuals (including members of partnerships) whose income has been negatively impacted by COVID-19. The scheme will provide a grant to self-employed individuals or partnerships, worth 80% of their profits up to a cap of £2,500 per month.HMRC will use the average profits from tax returns in 2016/17, 2017/18 and 2018/19 to calculate the size of the grant. The scheme will be open to those where the majority of their income comes from self-employment and who have profits of less than £50,000. The scheme will be open for an initial three months with people able to make their first claim by the beginning of June.
Is My Business Eligible?
To be eligible for the scheme you must meet all the criteria below:
- Be self-employed or a member of partnership;Have lost trading/partnership trading profits due to COVID-19;Filed a tax return for 2018/19 as self-employed or a member of a trading partnership. Those who have not yet filed for 2018/19 will have an additional 4 weeks from this announcement to do so;Have traded in 2019/20; be currently trading at the point of application (or would be except for COVID 19) and intend to continue to trade in the tax year 2020/2021; Have trading profits of less than £50,000 and more than half of your total income comes from self-employment. This can be with reference to at least one of the following conditions:Your average trading profits and total income across the three years between 2016/17, 2017/18, and 2018/19. Your trading profits and total income in 2018/19 if you haven’t been trading for longer.
How Much Will I Get?You will get a taxable grant which will be 80% of the average profits from the following tax years (where applicable):
To work out the average HMRC will add together the total trading profit for the 3 tax years (where applicable) then divide by 3 (where applicable), and use this to calculate a monthly amount.It will be up to a maximum of £2,500 per month for 3 months.The grant will be paid directly into your bank account, in one instalment. If you haven’t been self-employed for all of the three tax years 2016/2017, 2017/2018 and 2018/2019, then it will be based on the number of tax years since you started being self-employed, BUT if you weren’t self-employed in 2018/2019, you won’t be eligible to claim.
How Do I Apply For The Scheme?
HMRC will use existing information to check potential eligibility. If you are eligible, HMRC WILL CONTACT YOU and invite you to apply once the scheme is operational.
DO NOT CONTACT HMRC NOW, as doing so will only delay the urgent work being undertaken to introduce the scheme.When Will I Receive The Grant?
Grants are expected to start to be paid by the beginning of June 2020. This time is necessary to ensure that the scheme is both deliverable and fair.
What Can I Claim In The Interim?
In the interim the self-employed are still able to apply for other government support including more generous universal credit and business continuity loans:
- deferral of Self Assessment income tax payments due in July 2020 and VAT payments due from 20 March 2020 until 30 June 2020.
- grants for businesses that pay little or no business rates
- increased amounts of Universal Credit
- Business Interruption Loan Scheme
For further information on what financial support is available to UK businesses please use the following linkhttps://www.businesssupport.gov.uk/coronavirus-business-support/
We hope this information is useful but should you have any queries please do not hesitate to contact your usual contacts by email.Don’t forget that you can access more information on our website:https://www.kneeshaws.net/news/?op=/news/covid-19