Self-employed traders and partners who HMRC believe are eligible for the fourth grant under the Self-Employment Income Support Scheme (SEISS) should now have received a letter telling them the date from which they can make a claim. The claim portal on the Gov.uk website is open, and will remain open until 1 June 2021.
A claim can only be made where a person meets the eligibility conditions for the fourth grant. It should be noted that some of the conditions are unique to SEISS4 – the fact that a trader was eligible for previous grants does not necessarily mean that they will qualify for the fourth grant.
For the first time, a person who commenced trading in 2019/20 can claim, as long as they had filed their 2019/20 tax return by midnight on 2 March 2021 and traded in 2020/21. The trader must either be currently trading but impacted by reduced demand due to coronavirus or have been trading, but is temporarily unable to do so due to coronavirus (for example, where the business has had to close due to lockdown restrictions). As previously, trading income must account for at least 50% of the trader’s total income and not be more than £50,000, either for 2019/20 or on average over the period from 2016/17 to 2019/20.
When making a claim, the trader must declare that they intend to continue to trade and that they ‘reasonably believe’ that there will be a ‘significant reduction’ in their trading profits. The test is applied over the period from 1 February 2021 to 30 April 2021. HMRC have not set out what they regard to be a ‘significant reduction’ in trading profits – instead they expect they expect the trader to make an ‘honest assessment’ that their trading profits will be significantly reduced. In making this assessment, coronavirus support payments do not need to be taken into account.
Where the eligibility conditions have been met, the claim should be made through the online portal. The following information is needed to make a claim:
- self-assessment unique taxpayer reference;
- National Insurance number;
- Government Gateway User ID and password;
- UK bank account details.
The trader may also need to answer questions about their passport, driving licence or information held on their credit file.
Claims can only be made by the claimant themselves – as with previous grants, a claim cannot be made by a tax agent on the claimant’s behalf. This is to be avoided as doing so will trigger a fraud alert which will delay payment of the grant. It should be remembered that HMRC will check claims for their validity, and will take action to recover payments for incorrect or fraudulent claims.
Written by The Tax Advice Network