New Restrictions Relating to the Third Covid-19 SEISS Self Employed Income Support Grant

If you were eligible for the last two grants you may be eligible for this third grant. There are some further restrictions and examples which are set out in HMRC’s guidlelines. They are set out by HMRC

How your trading conditions affect your eligibility for the Self-Employment Income Support Scheme – GOV.UK (www.gov.uk)

The page is benerally very clear, apart from this particular restriction :

“You must also

  • reasonably believe there will be a significant reduction in your trading profits due to reduced demand or your inability to trade.”

What does this statement actually mean?

  1. HMRC have made it clear in the that increased costs due to the pandemic are not to be included in your trading profits calculation. Refer to the link above.
  2. HMRC have made it clear in the guidelines what counts as reduced demand and inability to trade. Refer to the link above.
  3. What is meant by “Trading Profits” ? The ICAEW in their latest news are of the thinking that the “reduction in your trading profits” refers to your whole financial year, not just the three months November 2020 to January 2021 to which the grant applies.
  4. What about the previous SEISS Grants ? HMRC have been requested to clarify whether or not the previous two SEISS grants are to be included in the calculation of trading profit (they are classed as taxable income).
  5. What is “a significant reduction” ? This has not been defined. HMRC have been asked for clarification.

Fortuneately you have until 29th January 2021 to claim the third grant, so HMRC will, I hope, have clarified this statement by then. I will keep you updated by blogging as the information becomes available.

With thanks to the ICAEW (Institute of Chartered Accountants in England and Wales) link to their document :

New ‘significantly reduced profits’ test for third SEISS grant | ICAEW

Please contact me if you would like some hep with your business. I offer the follwoing services : bookkeeping, payroll, CIS, VAT and Self Assessment for the Self Employed. Based near KIng’s Lynn I am also within easy reach of Swaffham, Downham Market, Wisbech, Fakenham and the North Norfolk Coast. www.barnowl-bookkeeping.co.uk 07771 333324