HMRC have now started taking applications for the fifth Self-Employed Income Support grant. This is intended to help businesses through from May to the end of September, when Government financial assistance to both the employed and the self-employed will end.
Eligibility for this grant is much the same as for the previous grant (which covered February through to April). The key point about these grants is that your 2019/20 tax return is now taken into account, which has brought some people into the scheme but has moved some other people out.
Although the grant notionally covers five months, the amount is based on only three months of ‘normal’ profits (normally the average profit on your recent tax returns).
The grant depends on your turnover in the year to April 2021 compared to the previous tax year:
- If it’s less than 70% of what it was, the grant is 80% of normal profits (capped at £7,500)
- If it’s fallen, but is still more than 70%, the grant is reduced to 30% of normal profits (capped at £2,850)
- If your turnover has increased, HMRC are likely to challenge your right to the grant
- If you didn’t have any turnover in 2019/20, you get the full 80% grant.
The rules can be quite complicated, as they try to allow some flexibility if the standard rules don’t give a reasonable result for you.
If you have any questions about this grant, SEISS in general, or indeed any other tax matters, please do contact us .