The eligibility criteria for the fifth SEISS grant have been further tightened. Claimants are being contacted now, by HMRC, by email or letter, setting out when a claim can be made.  Applications for this grant open late July and close 30th September 2021.

We look at what you need to be aware of:

 

  1. Do I Qualify For The Scheme?
  • You are eligible to claim if you are a self-employed individual or a member of a partnership only;
  • Subject to eligibility, the fifth grant can be claimed even if previous grants were not claimed;
  • The business needs to demonstrate it was impacted due to coronavirus between 1st May and 30thSeptember 2021, and also has to:
    • be currently trading but be impacted by reduced demand due to coronavirus; or
    • have been trading but be temporarily unable to do so due to coronavirus.
  • Guidance published requires you to certify
    • You intend to continue to trade; and
    • reasonably believe there will be a significant reduction in your trading profits due to reduced activity, capacity or demand or inability to trade due to coronavirus

 

  1. How Do I Prove Eligibility for the Fifth Grant?
  • You must have traded in 2019/20 and 2020/21;
  • You must intend to continue to trade;
  • You must have submitted your 2019/20 tax return to HMRC by 2nd March 2021;
  • The income-based tests are:
    • Average trading profits £50,000 or less;
    • Trading income at least equal to non-trading income (50% test);
    • Tests applied to 2020/21, if fail look at 4 years (2016/17, 2017/18, 2018/19, 2019/20)

 

  1. So What Am I Expected To Consider?
  • A claim for the 5th Grant requires turnover figures for a pandemic period and a pre-pandemic reference period;
  • Pandemic period is always deemed to be a 12 month period starting between 1 to 6 April 2020.
  • The Pre-pandemic reference period is 2019/20 tax return, with exceptions
  • You need to
    • Work out your April 2020 to April 2021 turnover
    • Find your turnover from either (1) 2019 to 2020 or (2) 2018 to 2019 to use as a reference year

 

  1. Where to find your turnover figure
  • This will be on your tax return
    • SA103S – page SES 1, box 9
    • SA103F – page SEF 1. box 15
    • SA800 – box 3.24 or 3.29 for partnerships
  • In calculating your turnover figure, you should not include any COVID 19 support payments received such as previous SEISS grants, Eat out to Help Out payments and any local authority grants received.

 

 

  1. How your turnover affects your grant amount
  • Turnover down by 30% or more
    • worked out at 80% of 3 months average trading profits, capped at £7,500
  • Turnover down by less that 30%
    • – worked out at 30% of 3 months average trading profits, capped at £2,850

 

  1. Your Consideration in Making A Claim
  • Given the complexity of this process, it seems HMRC are reliant upon you making an honest assessment.
    • Please be aware that any claim you make under the scheme will be retrospectively reviewed and HMRC will be able to check your figures after you submit your tax return for 2020/21.
    • There is clear intent to seek recovery of any claim made that is not supported by the retrospective review
  • If in doubt, please contact one of the Partners or your regular Account Manager.