SEISS news: HMRC to open application service from next week – everything you need to know

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SEISS grants have kept many self-employed workers afloat during the pandemic and from next week the fifth, and final, set of payments can be claimed. HMRC should have contacted eligible recipients by now and applicants will need to be aware of additional eligibility rules.

Should a claimant be eligible for SEISS based on their tax returns, HMRC should have contacted them in mid-July to give them a date that they can make their claim from.

The online service to claim fifth grants will become available from late July according to the Government, with next week being the final week of the month.

When claiming, self-employed workers will need to confirm they’ll meet the eligibility criteria and claims must be made before September 30, 2021.

HMRC urged self-employed workers to claim a fifth grant if they think their business profit will be impacted by coronavirus between May 1, 2021 and September 30, 2021.

READ MORE: SEISS & furlough schemes cost taxpayers £77billion – full details

Where claimants are not eligible based on their trading profits in their 2019 to 2020 return, HMRC will look back at the claimants previous years results.

The final stage concerns assessing ones future prospects, with claimants needing to inform HMRC that they intend to keep trading in 2021 to 2022, and declare they “reasonably believe” there will be a significant reduction in their trading profits due to coronavirus.

On top of this, new assessments are needed specifically for the fifth grants.

HMRC warns the fifth grant is different from previous grants as in most cases, when making a claim applicants need to tell them about their business turnover so it can work out the grant amount.

Turnover includes the takings, fees, sales or money earned or received by a business.

To make a claim, self-employed people will need to have two different turnover figures, they’ll need to work out their turnover for April 2020 to April 2021 and either 2019 to 2020 or 2018 to 2019.

Where claimants are eligible, they’ll receive one of two levels of grants.

HMRC will work out a grant amount based on how much the claimants turnover is down by after they’ve compared the two turnover figures, as detailed below:

  • Turnover is down by 30 percent or more: Claimants will get 80 percent of three months’ average trading profits, capped at £7,500
  • Turnover is down by less than 30 percent: Claimants will get 30 percent of three months’ average trading profits, capped at £2,850

The grants themselves will be subject to income tax and self-employed National Insurance contributions.

They must be reported on a 2021 to 2022 Self Assessment tax return and the grants will also count towards the claimants annual allowance for pension contributions.

HMRC can be contacted for help with SEISS claims but it warns it is currently receiving a very high number of calls.

As such, people are advised to check HMRC’s website for help before making contact.

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