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The Fifth And Final Self-Employment Income Support Scheme Grant

The Government has now published details in relation to the fifth and final Self-Employed Income Support Scheme (SEISS) grant. The portal for claiming this grant is expected to open by the end of this month and claims must be made by 30 September 2021.

Who is eligible?

Those who were eligible for the fourth grant should be eligible for this final grant, and a reminder of the conditions is below.

You need to be self-employed (including a partner in a partnership) and you must have:

  • Traded in tax year 2019/20 and submitted your tax return before 2 March 2021;
  • Traded in tax year 2020/21;
  • Be currently trading, but impacted by reduced demand due to COVID or have been trading but are temporarily unable to do so due to COVID;
  • Intentions to continue trading;
  • Reasonable belief that there will be a significant reduction in your trading profits due to the impact of COVID in the period from 1 May 2021 and 30 September 2021;
  • Trading profits of £50,000 or less and at least half of your total income for either 2019/20 or the average of tax years 2016/17 to 2019/20 inclusive.

What has changed?

The fifth grant differs to the fourth grant in that there is a new turnover test which determines the level of grant provided.

The grant is 80% of three months’ average trading profits capped at £7,500 for those whose turnover for the ‘pandemic period’ is at least 30% less than their turnover for the ‘reference period’.

Those with a ‘pandemic period’ turnover reduction of less than 30% will receive a grant based on 30% of three months’ average trading profits, capped at £2,850.

What do these terms mean?

‘Pandemic period’ refers to a 12-month period beginning on any date between 1 and 6 April 2020. Therefore, for businesses who prepare accounts on a tax year basis, they can simply use the figure that appears on their tax return. For those with a differing accounting date, a separate calculation will be required.

‘Reference period’ will usually be the turnover figure from the 2019/20 tax return, but taxpayers have the option to use 2018/19 if they feel it more accurately reflects a typical year for their business.

It should be noted that for the purposes of this test, any Coronavirus support payments (including previous SEISS grants) should be excluded from turnover.

Given the introduction of the new turnover test, you may want to seek assistance from your accountant prior to applying for this final grant to ensure you are not over/under claiming. We are happy to offer our advice on your situation so if you want to discuss your circumstances, please get in touch with your usual EQ Taxpert or call one of our offices.

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