4th Self-Employment (SEISS) Covid Grant

The fourth self-employment income support (SEISS) grant was confirmed in the Budget and set at 80% of 3 months’ average trading profits, paid out as 1 single instalment, capped at £7,500. A tool to calculate the claim will be available soon, covering the period of February to April 2021.

The fourth grant will take into account 2019-2020 tax returns and will be open to those who became self-employed in tax year 2019-2020. The rest of the eligibility criteria remains unchanged.

Your eligibility for the scheme will now be based on your submitted 2019 to 2020 tax return. This may also affect the amount of the fourth grant which could be higher or lower than previous grants you may have received. The online claims service for the fourth grant will be available from late April 2021 until 31 May 2021.

If you are eligible, HMRC will contact you mid-April to give you your personal claim date. This will be the date that you can make your claim from.

There will be more guidance about the fourth grant in due course.

There are several weeks to go before the claim portal goes live and still quite limited information in the public domain. Further clarification should (we hope) be issued over the next few weeks.

New Rules from March 2021

First test:    

• In 2019/20 as long as profit is less than £50,000 and it is more than half of taxable income
• If you pass that test – you qualify
• Only if you fail that test do you need to perform Test 2 and look at the averaging test

Second test:      

• So, you could have more than £50,000 profit in 2019/20 or more than 50% of other income, but as long as the average profit is less than £50,000 or less than 50% you qualify

Averaging

This looks at the four years 2016/17 – 2019/20. It is assumed in this model that the average is calculated over up to a 48-month period.

It will help you answer the questions ‘Do I qualify for a Grant’ and if so ‘How much will my Grant be?’

Further support

The UK government has also announced that there will be a fifth and final grant covering May to September.

You will be able to claim from late July if you are eligible for the fifth grant.

The amount of the fifth grant will be determined by how much your turnover has been reduced in the year April 2020 to April 2021.

The fifth grant will be worth:

• 80% of 3 months’ average trading profits, capped at £7,500, for those with a turnover reduction of 30% or more
• 30% of 3 months’ average trading profits, capped at £2,850, for those with a turnover reduction of less than 30%

Further details will be provided on the fifth grant in due course.

Let’s Talk

If you need help with this, don’t worry our team of experts can run the calculations for you. We have offices in Carmarthen, Haverfordwest, Lampeter, Tenby and Cross Hands. You can email us on info@lhp.co.uk or ring 01267 237534.