Tougher criteria for third SEISS grant

Applications will open on 30 November for the third grant available of the self employment income support scheme (SEISS), HMRC has published guidance which includes new criteria claimants must meet regarding the impact coronavirus is having on their business

To qualify for SEISS grants, businesses must be adversely affected due to the coronavirus (COVID-19). They must either be currently trading but be impacted by reduced demand, or have been trading but be temporarily unable to do so due to COVID-19.

The latest guidance on checking if you can claim a grant and new guidance on how trading conditions affect eligibility include an additional test. This requires the claimant to intend to continue to trade and reasonably believe there will be a significant reduction in their trading profits due to reduced activity, capacity or demand or inability to trade due to COVID-19.

ICAEWS’s tax faculty is warning that claimants are likely to need advice from their agent to consider whether they are eligible, while unrepresented taxpayers may well miss the fact that the criteria are significantly different from those that applied to the first and second grants.

It is also pointing out that the significant reduction in trading profits test is to be applied to the accounting period as a whole.

The ICAEW said: ‘For many taxpayers, for example those that use a 31 March or 5 April accounting date, the significant reduction of trading profits will be expected to appear in the results they report on their 2020/21 tax return. However, some taxpayers, for example those that use a 30 April accounting date, will not report the trading results for the relevant period until their 2021/22 tax return.’

Claimants can check their eligibility for the SEISS here.

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