Self-employed Income Support SchemeWhat you need to know before claiming 3rd SEISS payment

The self -employed income support scheme (SEISS) claims portal reopens today (Monday 30th Nov 2020),a word of WARNING though, new rules mean that taxpayers must declare their trade has been impacted by reduced demand before they can claim this time.

In order to qualify for the first two grants you just had to confirm your trade had been adversely affected by the coronavirus pandemic but it was easier to comply than the new “Impact on Demand “test.

You must have been eligible for the first and second SEISS claims.  You can still be eligible even if you did not make a claim! 

You must have traded in the 2018/2019 and 2019/2020 tax years.

You must now be trading but are impacted by reduced demand due to the Covid-19 pandemic.

OR

You have been trading but are temporarily unable to do so due to the Covid-19 pandemic.

You intend to continue to trade.

You reasonably believe that there will be a significant reduction in your trading profit covering the period 1st November to 29th January 2021.  When considering whether the reduction is significant, you need to consider your wider business circumstances.

So, what do we mean by “reasonably believe” and “significant reduction”?  You have reason to believe that you will suffer a significant reduction in trading profit due to reduced business activity, capacity or demand or an inability to trade due to Covid-19 restrictions covering the 3 month period to 31st January 2021.

A reduction in profit due solely to an increase in costs such as buying masks, cleaning supplies, screens and other PPE equipment will NOT be sufficient for a claim to be made.  HMRC examples of what is and what is not allowable can be found on the link below:

https://www.gov.uk/guidance/how-your-trading-conditions-affect-your-eligibility-for-the-self-employment-income-support-scheme?utm_source=ActiveCampaign&utm_medium=email&utm_content=HMRC+have+tightened+the+eligibility+criteria+for+3rd+SEISS+claim&utm_campaign=201126#examples

You have until 29th January 2021 to make a claim

What records you need to keep

  • Keep a copy of the amount claimed
  • The claim reference number
  • Evidence that at the time of making the claim you had reason to believe that the trading profits were going to be significantly reduced.
  • Evidence to show the impact and reduction in their business activity across the period from November to January inclusive.

Things to note

The grant will need to be reflected within your self-employed accounts and will be liable to tax and national insurance.

The eligibility is tighter than the first 2 grant payments so you may want to speak to us first.

Its really important to keep a copy of evidence backing up the reasons for your claim as this will help should HMRC look to review your claim in the future.

To make the claim, you will need:

  • Government Gateway user ID and password
  • UK Bank details including
  1. Bank account number
  2. Sort code
  3. Name on the account
  4. Your address linked to your bank account

Remember if you believe you are eligible you need to apply yourself, as accountants are not allowed to do it on your behalf. 

If you qualify you will receive one lump sum payment to cover the 3-month period 1st November to 31st January 2021.  It will be paid at 80% of the taxpayers average trading profits as calculated for SEISS 1st grant.

The grant whilst dependent on average trading profits has a maximum amount payable of £7500 equivalent to £2500 a month which is the same cap as the 1st grant that was payable.

You can read the full details here:- https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-19-self-employment-income-support-scheme#whocanclaim.  The last update to this guidance was yesterday!!!

 

PLEASE NOTE:  HMRC have experienced a lot of fraud as you can imagine whether it is from the Furlough Scheme, Bounce Back Loans or SEISS they have vowed to make an example of people they discover are not eligible so read the guidance carefully.  Sadly, if you were not eligible for SEISS grants 1 & 2 you are highly unlikely to be eligible for this one.

 

We have no idea how they are going to police the whole issue of Pandemic benefit payments to individuals or companies.

 

 

 

 

Disclaimer
The comments above do not count as advice on which you should rely on. It is provided for general information purposes only. Professional or specialist advice should always be sought before taking any action relating to the above. We make no representation, warranty, or guarantee that the comments above will meet your requirements. The comments above are subject to change.
It is important that you take professional advice before making any decisions based on the information that you learnt here. While every effort has been made to make sure it is accurate it cannot be precisely tailored to your personal circumstances. This article is for general information only and no action should be taken, or refrained from, as a result of this information.  Professional advice should be taken based on specific circumstances in each individual case.  Whilst we endeavour to ensure that the information contained in the article is correct, no liability  will be accepted by KMA Accountancy which is a trading name of Kim Marlor Associates Ltd or damages of any kind arising from the contents of this communication, or for any action, inaction  or decision taken as a result of using any such information.  We are not making any recommendations on anything contained in this post  or the guide.  

 

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