Posted: Wed 21st Apr 2021
Chancellor Rishi Sunak confirmed the fourth and fifth grants through the Self-employment Income Support Scheme (SEISS) during his 2021 Budget. The fourth grant is now open for applications.
The fourth SEISS grant covers the period from February, March and April. Unlike the previous three grants, it also covers self-employed people who've submitted a 2019-20 tax return. As a result, the government claims 600,000 more people may be eligible for the grant.
The grant is calculated based on 80% of three months' average trading profits for up to four tax years between 2016 and 2020. It will be paid out in a single payment and capped at £7,500 in total. Trading profits must be no more than £50,000 a year.
HMRC said that as the tax year 2019-20 is now taken into account, if you have previously claimed SEISS grants, you "may receive grants that are higher or lower in value than any previous SEISS payments".
When you can apply for the fourth Self-employment Income Support Scheme grant
HMRC has contacted self-employed people by email, letter or SMS with a personal claim date. This is the earliest date you can claim.
HMRC is encouraging people to apply on different dates to ensure the application system remains stable.
You can check your claim date here. If you believe you're eligible but you haven't yet heard from HMRC, HMRC says you should wait until the end of April before you contact them. HMRC contact details are here.
Applications close at 11.59pm on 1 June 2021.
Eligibilty for the fourth Self-employment Income Support Scheme grant
To be eligible for the fourth SEISS grant, you must be self-employed or a member of a partnership. At least 50% of your income must come from self-employment.
You can't apply if you're a limited company director but you might be eligible for the Coronavirus Job Retention Scheme if you receive a PAYE salary.
You must have traded in the 2019 to 2020 and 2020 to 2021 tax years and submitted your 2019 to 2020 self assessment tax return by 2 March 2021.
HMRC will first look at your 2019 to 2020 tax return to work out eligibility. Your trading profits must be no more than £50,000 and at least equal to your non-trading income.
If you're not eligible based on that, officials will then look at the tax years 2016 to 2017, 2017 to 2018, 2018 to 2019 and 2019 to 2020
To be eligible you must "reasonably believe" will suffer a significant reduction in trading profits because of reduced business activity, capacity, demand or inability to trade as a result of coronavirus between 1 February 2021 and 30 April 2021. There are examples here of how self-employed people might be negatively impacted by coronavirus.
You must keep evidence to show how your business has been impacted by coronavirus resulting in less business activity than otherwise expected.
How to claim the fourth self-employed grant
You can make a claim here. You'll need your:
Self Assessment Unique Taxpayer Reference (recover a lost or get a new UTR number here)
National Insurance number (recover a lost or get a new NI number here)
Government Gateway user ID and password
UK bank details
You may need to answer questions about your passport, driving licence or other information HMRC holds about you.
Remember that the earliest day you can claim is the date provided to you by HMRC. The final deadline is 11.59pm on 1 June 2021.
You must make the claim yourself. If a tax agent or adviser makes a claim on your behalf it could trigger a fraud warning and delay your claim.
The grant will be paid into your bank account within six working days.
How to claim the fifth self-employed grant
Rishi Sunak announced a fifth grant which he said will be the last grant through SEISS. It covers May to September.
For self-employed people suffering a loss in turnover of 30% or more, the grant will be worth 80% of three months' average trading profits, capped at £7,500. For those experiencing a drop in turnover below 30%, the grant will be worth 30% of three months average trading profits, capped at £2,850.
You will be able to claim the fifth grant from late July.
The government said more information about the fifth SEISS grant will be released soon. We will update this post when more details are confirmed.