Self-Employed Income Support Scheme
Claim a grant from HMRC through the Covid-19 (Coronavirus) Self-employment Income Support Scheme (SEISS)
You can use this business support scheme if you're self-employed or a member of a business partnership and have lost income due to the Coronavirus outbreak.
If you are eligible for this scheme, it will allow you to claim a taxable grant worth 80% of your trading profits, up to a maximum of £2,500 per month for the next 3 months; which may be extended by the government if required.
Who can apply?
You can apply if you’re a self-employed individual or a member of a partnership and you satisfy the criteria listed below:
- have submitted your Income Tax Self-Assessment Tax Return to HMRC for the tax year 2018-19 (5th April 2019)
- traded in the tax year 2019-20
- are trading when you apply, or would be except for Covid-19
- intend to continue to trade in the tax year 2020-21
- have lost trading/partnership trading profits due to Covid-19
Your self-employed trading profits must also be less than £50,000 and more than half of your income must
come from self-employment.
This is determined by at least one of the following conditions being true:
- having trading profits/partnership trading profits in 2018-19 of less than £50,000 and these profits constitute more than half of your total taxable income
- having average trading profits in 2016-17, 2017-18, and 2018-19 of less than £50,000 and these profits constitute more than half of your average taxable income in the same period
If you started trading between 2016-2019, HMRC will only use those years for which you filed a Self-Assessment Tax Return.
Who cannot apply for this scheme?
After HMRC consultation the following income types are not eligible for this scheme.
- Self-employed or partners that have started after 5th April 2019
- Self-Employed or partners who have taxable profits of more than £50,000
- Property Investors with Land and Property Income
- Company Directors; who pay a basic salary and dividends
Dividends are not classed as self-employment income and therefore Company Directors that pay themselves through PAYE should apply for the Job Retention Scheme - https://brinsdon.thelocalaccountant.co.uk/job-retention-scheme
If you do not meet the eligibility requirements for the SEISS help you should look at applying for Universal Credit, as this may suit your individual circumstances better - https://www.gov.uk/universal-credit
What happens if I have not yet filed my 5th April 2019 Tax Return?
If you have not submitted your Income Tax Self-Assessment tax return for the tax year 2018-19 (5th April 2019), you must do this by 23 April 2020 to be eligible for the grant.
HMRC will use data on 2018-19 returns already submitted to identify those eligible and will risk assess any late returns filed before the 23 April 2020 deadline in the usual way.
How much will you get?
You’ll get a taxable grant which will be 80% of the average profits from the relevant tax years (where applicable):
- 2016 to 2017
- 2017 to 2018
- 2018 to 2019
To work out the average HMRC will add together the total trading profit for the 3 tax years (where applicable) then divide by 3 (where applicable), and use this to calculate a monthly amount.
It will be up to a maximum of £2,500 per month for 3 months.
HMRC will pay the grant directly into your bank account, in one instalment during June 2020.
How to apply?
You cannot apply for this scheme yet as HMRC are currently working on a new software system administrate grant payments.
HMRC will contact you if you are eligible for the scheme and invite you to apply online.
Individuals do not need to contact HMRC now, as doing so will only delay the urgent work being undertaken to introduce this scheme.