Self-employed people will be able to claim a second grant via the Self-Employment Income Support Scheme (SEISS) from August 17, the government has announced. The scheme is now closed to new claims for the first grant.
People who were eligible for the first grant and can confirm to HMRC that their business has been adversely affected on or after July 14, 2020, will be able to make a claim for a second and final grant from August 17, 2020. Applications for the second and final grant must be made on or before October 19, 2020, at which point the scheme will close.
The scheme allows self-employed individuals or members of a partnership to claim a second and final taxable grant worth 70% of their average monthly trading profits, paid out in a single instalment covering three months’ worth of profits, and capped at £6,570 in total.
As with the first grant, HMRC will contact people who are eligible and calculate how much grant they will get, based on tax return data for the past three years’ tax returns. You can make a claim for the second grant if you’re eligible, even if you did not make a claim for the first grant, a government statement said.
If you receive the grant you can continue to work, start a new trade or take on other employment including voluntary work, or duties as a military reservist. The grant does not need to be repaid but will be subject to Income Tax and self-employed National Insurance. You must keep evidence to confirm your business was adversely affected at the time you made your claim.
Claimants must have traded in the tax year 2018 to 2019 and submitted a Self Assessment tax return on or before April 23, 2020 for that year. They must also have traded in the tax year 2019-20 and intend to continue to trade in the tax year 2020-21. Claimants must carry on a trade which has been adversely affected by coronavirus, and cannot claim the grant if they trade through a limited company or a trust.
If you claim Maternity Allowance this will not affect your eligibility for the grant. To work out your eligibility, your trading profits in your 2018-19 Self Assessment tax return must be no more than £50,000 and at least equal to your non-trading income. You must make the claim yourself. Your tax agent or adviser must not claim on your behalf as this will trigger a fraud alert, and you will have to contact HMRC. This will cause a significant delay to you receiving your payment.
To claim the grant, applicants will need UK bank details and a Government Gateway user ID and password – if you do not have a user ID, you can create one when you make your claim. The SEISS has so far seen 2.3 million claims worth £6.8 billion.
Chancellor Rishi Sunak has also outlined further details on the extension of the Coronavirus Job Retention Scheme, including improved flexibility to bring furloughed employees back part time in July, and a new taper requiring employers to contribute to furloughed salaries from August.
will be able to claim a second and final grant in August. The grant will be worth 70% of their average monthly trading profits, paid out in a single instalment covering three months’ worth of profits, and capped at £6,570 in total.
The Chancellor also set out more details on how the Coronavirus Job Retention Scheme (CJRS) will continue to support jobs and business as people return to work, following the announcement of an extension of the scheme on 12 May.
So far, the CJRS has helped 1 million employers across the UK furlough 8.4 million jobs, protecting people’s livelihoods.
From July 1, 2020, businesses will be given the flexibility to bring furloughed employees back part time. This is a month earlier than previously announced to help support people back to work. Individual firms will decide the hours and shift patterns their employees will work on their return, so that they can decide on the best approach for them – and will be responsible for paying their wages while in work.
From August 2020, the level of government grant provided through the job retention scheme will be slowly tapered to reflect that people will be returning to work. That means that for June and July the government will continue to pay 80% of people’s salaries. In the following months, businesses will be asked to contribute a modest share, but crucially individuals will continue to receive that 80% of salary covering the time they are unable to work.
The scheme updates mean that the following will apply for the period people are furloughed:
June and July: The government will pay 80% of wages up to a cap of £2,500 as well as employer National Insurance (ER NICS) and pension contributions. Employers are not required to pay anything.
August: The government will pay 80% of wages up to a cap of £2,500. Employers will pay ER NICs and pension contributions – for the average claim, this represents 5% of the gross employment costs the employer would have incurred had the employee not been furloughed.
September: The government will pay 70% of wages up to a cap of £2,187.50. Employers will pay ER NICs and pension contributions and 10% of wages to make up 80% total up to a cap of £2,500. For the average claim, this represents 14% of the gross employment costs the employer would have incurred had the employee not been furloughed.
October: The government will pay 60% of wages up to a cap of £1,875. Employers will pay ER NICs and pension contributions and 20% of wages to make up 80% total up to a cap of £2,500. For the average claim, this represents 23% of the gross employment costs the employer would have incurred had the employee not been furloughed.
Chancellor Rishi Sunak said: “Our top priority has always been to support people, protect jobs and businesses through this crisis. The furlough and self-employment schemes have been a lifeline for millions of people and businesses. As we begin to re-open our country and kickstart our economy, these schemes will adjust to ensure those who are able to work can do so, while remaining amongst the most generous in the world.”
Employers will be required to submit data on the usual hours an employee would be expected to work in a claim period and actual hours worked. Employees who believe they are not getting their 80% share can also report any concerns to the HMRC fraud hotline.
SEISS information here: