SEISS: extension of the self-employed support package explained

Ellie Lister
Tuesday 7th July, 2020

The self employed community have been seriously affected by the outbreak of Coronavirus, and we’re sending our very best wishes to everyone. Following the government’s first SEISS package that helped cover thousands of people, the scheme has been extended so that the self-employed can apply for a second grant.

Our previous blog post that outlined the government’s SEISS package for months March - May helped out our customers a lot. So, we wanted to write a follow up blog about the government’s second grant to cover the months from June - August, to make sure you know if you’re eligible, how much you’ll get, and exactly how to get it. 

First Grant

The first grant that covered your income from March, April and May would have come in around the 13th May 2020. The amount paid was 80% of your average profit over the past 3 tax years, and was capped at £2,500 a month. The deadline for applying for this first grant is the 13th July 2020, so you can still apply if you’re eligible for it (see below), click the link here to submit an application!

Second Grant

However, for the second grant, the payment amount drops to 70% of your average profit over the past 3 tax years, to cover months June, July and August. It will be paid as one single instalment covering the 3 months, where the profit is capped at £6,570 total. 

For this scheme you will have to show that your business has been affected on or after 14th of July. However, you won’t be able to make a claim for the grant until the 17th August. Of course, you can make a claim for this second grant even if you did not make a claim for the first grant. You’ll be able to claim for the grant on the gov.uk website, once applications open on the 17th, and you can sign up to get emails about any changes to this here.

Am I eligible & how can I prove it?

1. You have to be self-employed or a member of a partnership:

  • The government is asking that you have to have traded in 2019-20, be trading at the point of application & in the next tax year 2020-21
  • To prove this, they need a tax return for the financial year 2018-2019 (the deadline for this was in January 2020). 

2. You have to have trading profits less than £50,000 & more than 50% of your total annual income comes from self-employment:

  • This can be proven by the trading profits and total income in your 2018-19 tax return
  • It can also be proven by the average of your trading profits and total income across the three financial years - 2016-17, 2017-18 and 2018-19

Can I keep working?

Yes! As long as you continue working as self employed during the 2020/21 tax year. You can also work at another job to support your household income whilst receiving the grant payments. However, you need to make sure that your grant payments represent the majority of your income - greater than 50% of your income.

Important tax notes

Remember that the SEISS grant payments are classed as taxable, earned income, so you have to declare it in your Self Assessment tax return.  As well, this income needs to be taken into account if you're applying or have applied for Universal Credit.

If you do need any help with calculating your tax bill, then check out our partner GoSimpleTax who can do this all for you. Check out their 14 day free trial and then you can always upgrade your account if you want them to submit your Self Assessment tax return directly to HMRC for you. And as a Penfold customer you'll get a 15% discount, just click the link here!

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