Self-Employment Income Support Scheme (SEISS) – FAQs

1. Am I eligible?

You can apply if:

  • you are currently self-employed
  • you have submitted a 2018/19 self-assessment tax return
  • you expect to continue your trade in 2020/21
  • you have been affected by Covid-19 and have lost trading income
  • your self-employed profits must be less than £50,000
  • More than half of your income is from self-employment

2. How do I apply?

HMRC will contact individuals who they think are eligible in the coming weeks so you do not need to do anything at this stage. Once HMRC contact you they will invite you to apply online.

3. How much will I receive?

The scheme is designed in a similar way to the employee job retention scheme, ensuring you will receive up to 80% of your self-employment monthly income, capped at £2,500. 

To calculate the amount HMRC will grant you, they will look at your last three self-assessment tax returns (2016/17, 2017/18 and 2018/19) and calculate a monthly average of your earnings, this is what they will base the 80% grant on.

If you haven’t traded for the whole three years they will look at the period you have traded and calculate on that basis.

4. Is the grant tax free?

No, the grant is intended to replace your income which would be taxable so it is taxable earnings and will need to be included on your tax return in the usual way.

Similarly, if you receive tax credits the grant will form part of your income for your tax credit claims.

5. How will it be paid?

HMRC will pay the grant directly in to your bank account once they have contacted you and asked you to apply online.

6. How long do I have to wait to receive it?

HMRC expect to have the scheme up and running by 1 June 2020 but are hoping to do this sooner if possible.

7. I haven’t filed a tax return for 2018/19, what do I do?

To be eligible for the grant you must have submitted your 2018/19 tax return, the filing deadline was 31 January 2020. HMRC have announced they will allow those that have not yet submitted their returns to do so by 23 April 2020.

8. How do I prove I have lost trading income as a result of Covid-19?

We do not yet know how HMRC will expect individuals to prove how they have lost income due to the pandemic although it would be sensible to assume they may ask for proof of earnings e.g. bank statements or invoices.  Once full details are known we will communicate this.

9. What do I do for income until my grant comes through?

HMRC have introduced a deferral of the Income Tax payment on account due in July 2020 until January 2021, to help the self-employed cope with the immediate financial impact.

The government have also introduced a three month mortgage payment holiday that you can request from your mortgage provider if you have suffered due to Covid-19.

Contact us

If you have any further questions, please contact us at advice@taitwalker.co.uk.