The Third SEISS Grant Opens For Applications Today!
With tougher criteria though ...
Posted by Roger Eddowes on 30/11/2020 @ 8:00AM
The Third Self-Employment Income Support Scheme (SEISS) grant is open to applications from today, but if you are thinking of applying for it, be aware that there are now tougher criteria to consider ...
The third SEISS grant opens for applications today, with tougher criteria though!
Anyone applying for the third SEISS grant has to be either trading, but impacted by reduce demand due to Coronavirus, or has been trading, but is temporarily unable to do so due to the pandemic.
"Claimants must also declare that they will continue to trade!"
So, this means that the claimant should be truthful about their reduced business activity, capacity or demand between the 1st November 2020 and the 29th January 2021. Evidence should be kept to support the claim.
What does HMRC consider a significant reduction in trading? Well, they say that they cannot make this decision on behalf of an individual business because a wide range of circumstances needs to be taken into consideration; however, they have released guidance that offers a number of examples designed to help and inform.
As an example, a cafe owner who has lost customers due to government restriction on household mixing. This has reduced her takings, reducing her trading profits overall. However, if that same cafe owner has increased her prices due to the loss of customers, and her takings remain essentially the same, she would not be eligible to claim.
A builder who had to self-isolate, but was able to rearrange his contracts would not be eligible because he hasn't lost any trade. Nor would an electrician who had to invest in PPE, but was able to continue working without a loss of business overall because only his costs have gone up rather than losing actual trade.
And as a final example, a dentist returning from a holiday abroad, needing to self-isolate for 14-days due to quarantine is also not eligible. Reduce demand due to self-isolation after travel is not included in the eligibility criteria.
The criteria for the third SEISS grant are different from the first and second grants, and you'll need to show this significant reduction in trading profits in your 2020/21 tax return although in certain cases, this may roll into your 2021/22 tax return.
"I am a little concerned about a couple of these new requirements!"
The significant reduction in trading profits test now applies to the tax year as a whole, so you may need to do some forecasting of results to establish your eligibility. Also, it does seem highly unlikely that HMRC could enforce these new requirements as some 2021/22 tax returns could be submitted in January 2023.
Remember, if you weren't eligible for the first and second SEISS grants, you won't be eligible for this one either.
Until next time ...
ROGER EDDOWES Business Godparent
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Roger trained at Edward Thomas Peirson & Sons in Market Harborough before working at Hartwell & Co, followed by Chancery, as a partner. He started Essendon Accounts and Tax with Helen Beaumont in 2014 as a general practitioner with a hands-on approach.
Roger loves getting his hands dirty, working with emerging, small-to-medium and family businesses to ensure they receive the best possible accountancy advice. Roger utilises an extensive network of business contacts to leverage the best guidance and practical solutions.
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