Applications for the Self Employment Income Support Scheme (SEISS) 5 are open from the end of this month and will be calculated on how much your turnover has reduced in the tax year April 2020 to April 2021. This is different to the previous SEISS grants where a reduction in profit has been the basis of the claim.
To be eligible to apply for SEISS 5;
- You must be a self-employed individual or in a partnership & having traded in 2019/20
- Have traded in 2020/21, subject to coronavirus restrictions and intend to continue trading to 2022.
- Believe that your trading profits will be significantly impacted by COVID-19 between 1 May and 20 September 2021.
- Submitted a tax return on or before 2nd March 2021.
- Have trading profits not exceeding £50,000 per year
- At least half your trading profits must be equal to your non-trading income. The latter is income made outside of your business e.g. part time job, pension etc.
The grant will be payable for the 3 months to 31 July 2021 and you have until 30 September 2021 to apply.
A maximum of £7,500 can be claimed. However, unlike previous SEISS’s where profit measures were used to calculate eligibility, HMRC have introduced a complex turnover test. If the turnover of your business has fallen by at least 30% , when comparing 2019/20 and 2020/21, then a full grant is calculated at 80% of average trading profits. If your business turnover is less than 30% then you receive a grant based on 30% of average profits which is capped at £2,850.
If you need help with this or any other accounting needs, then please get in touch on 0113 286 4486
Source: Accounting Web & HMRC
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