The fourth grant covers 1 February 2021 to 30 April 2021.
Who can claim
To be eligible for the fourth grant you must be a self-employed individual or a member of a partnership. You cannot claim the grant if you trade through a limited company or a trust.
You must have traded in both tax years:
- 2019 to 2020 and submitted your tax return on or before 2 March 2021
- 2020 to 2021
You must either:
You must also declare that you:
- intend to continue to trade
- reasonably believe there will be a significant reduction in your trading profits
Reasonable belief
In order to claim the fourth grant, you must reasonably believe that you’ll suffer a significant reduction in trading profits, due to reduced business activity, capacity, demand or inability to trade due to coronavirus between 1 February 2021 and 30 April 2021. You must keep evidence that shows how your business has been impacted by coronavirus resulting in less business activity than otherwise expected.
HMRC expects you to make an honest assessment about whether you reasonably believe your business will have a significant reduction in profits.
Significant reduction
Before you make a claim, you must decide if the impact on your business between 1 February 2021 and 30 April 2021 will cause a significant reduction in your trading profits for the tax year you report them in.
HMRC cannot make this decision for you because your individual and wider business circumstances will need to be considered when deciding whether the reduction is significant.
You should wait until you have a reasonable belief that your trading profits are going to be significantly reduced, before you make your claim.
You do not have to consider any other coronavirus scheme support payments that you have received when deciding if you’ve had a significant reduction in your trading profits.
How HMRC works out your eligibility based on your tax returns
To work out your eligibility for the fourth grant we’ll first look at your 2019 to 2020 Self Assessment tax return. Your trading profits must be no more than £50,000 and at least equal to or more than your non-trading income.
If you’re not eligible based on your 2019 to 2020 Self Assessment tax return, we’ll then look at the tax years 2016 to 2017, 2017 to 2018, 2018 to 2019 and 2019 to 2020.
How much you’ll get
The fourth grant is calculated at 80% of 3 months’ average trading profits. It will be paid out in a single instalment and capped at £7,500 in total. How much you receive will depend on your average trading profits.
We’ll work out your average trading profits using up to 4 years’ of submitted tax returns. This may affect the amount you’ll get which could be higher or lower than your previous grants.
We’ll take into account trading profits from the 2016 to 2017, 2017 to 2018, 2018 to 2019 and 2019 to 2020 tax years. If you have a gap in the years you have traded, we’ll only use your most recent returns after the gap to work out the grant.
This is an example of how we’ll work out how much grant you’ll get if your average trading profits were £42,000 over the last 4 tax years.
Example
- Start with your average trading profit (£42,000).
- Divide by 12 = £3,500.
- Multiply by 3 = £10,500.
- Work out 80% of £10,500 = £8,400. You’ll receive £7,500 due to the cap.
Find out more information on how HMRC work out your trading profits.
How to make a claim
Find out how to make a claim for the fourth grant.
You can check a list of genuine HMRC contacts if you receive any suspicious texts, calls or emails claiming to be from HMRC as this may be a scam.
How the grant is treated
The grant is subject to Income Tax and self-employed National Insurance Contributions. It must be reported on your 2021 to 2022 Self Assessment tax return.
The grant also counts towards your annual allowance for pension contributions.
SEISS grants are not counted as ‘access to public funds’, and you can claim the grant on all categories of work visa.
Further support
There will be a fifth grant covering May 2021 to September 2021.
Guidance on how to claim the fifth grant will be provided in due course.
Source: https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-19-self-employment-income-support-scheme#whocanclaim
