SELF-EMPLOYED workers have just over one week until the deadline to claim the third coronavirus grant worth up to £7,500.
The self-employment income support scheme (SEISS) gives cash to help those who work for themselves if their income has been hit by Covid-19.
SEISS has already given out two rounds of grants to the self-employed since the pandemic began.
The third SEISS grant opened for applications on November 30, and you must make your claim on or before next Friday, January 29, to get it.
Chancellor Rishi Sunak announced the third grant in September as he extended the self-employed scheme to help workers survive the winter.
In November, Mr Sunak then increased the grant to £7,500, covering 80% of trading profits for November to January.
What other help is there for self-employed workers?
THE government has also introduced the following measures to help self-employed workers and businesses during the coronavirus outbreak:
Income-tax deferrals: Self-assessment income tax payments, that were due in July, can be deferred to the end of January.
Rent support: Businesses who were struggling to pay their rents were protected from eviction until the end of June.
Coronavirus business interruption loan scheme: SMEs can get loans and overdrafts of up to £5million for up to six years and the government will guarantee up to 80% of these.
Grants of up to £10,000: Small firms can get grants of up to £10,000 to help with ongoing business costs.
VAT payments: VAT payments can be deferred for three months.
Tax bill help: SMEs that cannot afford their tax bills can ask HMRC for a “time to pay” arrangement so any debt collection is suspended.
Business rates holiday: A 12-month business rates holiday has been introduced for many businesses.
But self-employed workers still have to meet a stringent set of criteria to be eligible for the payout as the government seeks to avoid widespread fraud.
So before you miss the chance of claiming, we've outlined how to check if you're eligible for the SEISS grant and how to apply.
How to check you're eligible for a third self-employment grant
For those unsure of whether they are elible for the third grant, there's a simple checklist of criteria to go through:
- In order to claim the payout, self-employed workers must have been eligible for the first and second grant – even if you didn't claim them. (This is with the exception of some people who became eligible after a couple of rule changes in August, which are outlined below.)
- You must declare that you intend to continue to trade and that you're either currently actively trading but are impacted by reduced demand due to the coronavirus.
- Alternatively, you must declare that you were previously trading but are temporarily unable to do so due to the pandemic.
- You must have filed a tax return for 2018/19, meaning you must have been self-employed before April 6, 2019.
- You must also earn more than half of your total income from self-employment.
- Your trading profit must be less than £50,000 a year
The grants are calculated based on an average of your profits over three tax years – 2016/17, 2017/18 and 2018/19.
If you didn't trade in 2016/17, then it will be based on your average profits in 2017/18 and 2018/19, or in 2018/19 if that's the only year you traded.
Sadly, self-employed workers who are company directors or run their businesses as limited companies can't apply.
But if you claim maternity allowance this will not affect your eligibility for the grant.
Self-employment grant: who can claim?
YOU can claim if you’re a self-employed individual or a member of a partnership and you:
- Have submitted your self assessment tax return for the tax year 2018/19
- Traded in the tax year 2019/20
- Are trading when you apply, or would be except for coronavirus
- Intend to continue to trade in the current tax year (2020/21)
- Have lost trading profits due to coronavirus
How have the eligibility rules changed?
The government tweaked the rules on August 17 so you may have been eligible to claim the second grant and now the third despite missing out on the first payout.
New parents who were excluded from the first grant because they were pregnant or caring for a new child may now be able to make a claim.
Self-employed mums and dads who didn't file their taxes for one or more of the following reasons are now included in the scheme:
- Because you were pregnant or you gave birth,
- You were caring for a child under the age of one,
- You were caring for an adopted child who had been with you for less than a year.
In order to qualify, you'll also need to meet the other criteria, such as you must have been self-employed in 2017/18 and submitted a tax return for the year before April 23, 2020.
New parents had to fill out an online form asking for HMRC to verify the information about their new child before October 5, 2020.
You needed your child's full name and date of birth, the date of adoption, child benefit number and your child's birth certificate.
You also had to let HMRC know whether you were claiming maternity allowance.
Military reservists who were previously excluded from the scheme can now apply for the help too.
But to be eligible, you must be self-employed and have carried out reservist activities for at least 90 days during the period your 2018/19 profits are calculated.
Could I have lost my eligibilty from the first two grants?
The government has also changed the rules for the third grant and this could now rule out some workers who were eligible for the first two grants.
Self-employed workers are now only eligible if they are currently actively trading but are impacted by "reduced demand" due to the coronavirus.
It's important to note that the phrase "reduced demand" is an alteration from "adversely affected" outlined in the rules for the first two grants.
This could affect your eligibility and means gathering evidence of "reduced demand" between November 1 and January 29 is now crucial.
This includes proof that you have fewer customers or clients than you would normally expect, resulting in reduced activity due to social distancing or government restrictions.
It could be that you have one or more contracts that have been cancelled and not replaced or you have carried out less work due to supply chain disruptions.
Evidence could include accounts, confirmation of Covid-19 related loans, or dates of business closures due to lockdown restrictions.
You aren't eligible to claim if the only impact on your business is increased costs.
For example, if you had to purchase face masks and cleaning supplies – this would not be considered as reduced demand.
How much will I get?
Under the self-employed income support scheme (SEISS), the government will cover 80% of your trading profits over three months.
Previously, self-employed workers were only set to receive grants worth 40% of average monthly profits from November through to January 2021.
To calculate how much you'll get, you should start with your average trading profits over the last three tax years.
For example, if you had profits of £42,000, first divide this number by 12, which is £3,500.
Then multiply this number by three months, which leaves you with £10,500.
Lastly, 80% of £10,500 works out as £8,400. However, you'll only be paid £7,500 due to the cap.
How do I apply?
You can make your claim via the Gov.uk website on or by January 29.
Self-employed workers will need the following info to claim:
- Self-assessment unique taxpayer reference (UTR) – if you don't have this, find out how to get your lost UTR
- National insurance number – if you don't have this, find out how to get your lost national insurance number
- Government Gateway user ID and password – if you don't have a user ID, you can create one when you make your claim
- UK bank details (only provide bank account details where a BACS payment can be accepted)
Will there be a fourth self-employment grant?
Yes, Mr Sunak has confirmed that there will be a fourth grant, which will run from February until April.
In an economic update to the House of Commons in January, he announced the extended scheme along with another raft of support measures to prop up struggling Brits.
The government is yet to share more details though, including how much you'll be able to get.
For a deep dive into the how SEISS works, we've put together a guide with everything you need to known about the system.
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