Self-employed income support scheme: Round Four

Apr 28, 2021

Self-employed workers who lost income due to COVID-19 can now apply for the fourth round of taxable grants under the self-employment income support scheme (SEISS).

The fourth grant covers the three-month period between 1 February and 30 April 2021, and an additional 600,000 individuals are expected to be eligible for the first time.

HMRC should have contacted these individuals, assuming they filed a 2019/20 tax return, to give them a date from which they can submit their claims. They have until 1 June 2021 to get their applications in.

How much can I get from the SEISS?

As with the previous SEISS grant, applicants can get 80% of their average trading profits up to £2,500 per month, or £7,500 in total from the fourth instalment.

HMRC has been taking total trading profits and losses of the last five tax years for the last instalments to work out average trading profits, and will also take the 2019/20 tax year into account for the fourth payment.

A fifth round of SEISS grants will also open sometime in late July to cover the period from 1 May to 31 July 2021.

This will offer eligible individuals the same 80% grant - but only if their turnover has fallen by 30% or more, diverging from how previous SEISS instalments were administered.

Chancellor Rishi Sunak justified the change in Spring Budget 2021, saying that people whose turnover has fallen less than 30% "have less need of taxpayer support and will receive a 30% grant".

Who is eligible?

The grant is targeted at self-employed individuals who have "reasonable belief" that their trading profits suffered a "significant reduction" because of the pandemic, according to HMRC.

For instance, someone's work might have been negatively affected by COVID-19 if they have:

  • been shielding or caring for others over the pandemic
  • had to scale down because staff are unable to work
  • experienced reduced demand for their work because of social distancing and lockdown measures.

You can still claim the fourth grant even if you did not claim an earlier SEISS grant.

To be eligible, trading profits must be no more than £50,000 and equal to or more than an applicant's non-trading income, such as dividends and property income.

Individuals in partnerships can also claim but must only use their share of the profits to calculate their SEISS claim.

Only businesses that plan on continuing to trade will be considered for a grant.

How do I apply for the SEISS?

Applications can be made through HMRC's online portal, where claimants should have the following information to hand:

  • self-assessment unique taxpayer reference (UTR)
  • National Insurance number
  • government gateway user ID and password
  • UK bank details including account number, sort code, name on the account and address linked to the account.

Records must be kept to prove a business has had reduced activity, capacity or demand, including business accounts and records of reduced/cancelled appointments due to the pandemic.

If a business was temporarily closed, you may want to have a record of dates where it was closed due to Government restrictions, or retain your test results if you stopped working because you had COVID-19.

After a claim has been submitted, HMRC will check it and pay the grant into your bank account within six working days, sending an email to let you know it's on its way as well.

Applicants must make their claims themselves; asking a tax agent or adviser to claim on your behalf will trigger a fraud alert, which will delay your payment.

Talk to us about COVID-19 support.


Arrange a consultation

If you’d like to discuss your business needs and explore how our accountancy and advice services might answer them get in touch to schedule a free initial consultation meeting.