Although two further SEISS grants were announced in the September Winter Economy plan, the third self-employed income support scheme (“SEISS”) grant was doubled in an announcement in early November by the Chancellor.

Claims in respect of the third SEISS grant opened on Monday 30 November 2020 – however a tougher eligibility test of reduced profits must now be met – see below. More information and examples are available on GOV.UK to help you check eligibility to claim‌‌. Our advice is that anyone advising clients on the SEISS or applying for it themselves should discuss and review the new eligibility criteria in advance of making a claim.

Full details of the third SEISS grant have been published on GOV.UK. More information on the fourth grant (covering the three-month period from February 2021 to April 20‌‌21) will be provided in January 2021.

The third grant, which offers 80 percent of three months’ average trading profits, paid out in a single taxable instalment capped at £7,500 is available to cover the period 1 November 2020 – 29‌ ‌January 2021. Claims for the third grant are open from 30 November 2020 until 29‌ ‌January 2021.

Help your clients get ready

As with previous claims, agents cannot apply for the grant on behalf of their clients however you can help clients get ready.

Agents can check who is eligible to claim as this is different to the previous SEISS grants. However, if you try to make a claim on a client’s behalf, as before this will trigger a fraud alert that will delay the payment.

According to HMRC, applying online is quick and easy for your clients and is similar to the process for SEISS 1 and 2. This takes just 5 minutes and can be done on a smartphone.

Amended eligibility criteria

As mentioned above, the rules on who is eligible to claim have changed. However, your clients will still need to have submitted a Self-Assessment tax return for the tax year 2018/19 showing self-employment income in order to claim (unless one of the existing exceptions applies).

To make a claim for the third grant, your clients must also meet a number of conditions, and make an honest assessment about whether they reasonably believe their trading profits will be significantly reduced due to coronavirus.

As before, your clients must:

• be a self-employed individual or a member of a partnership. They cannot claim the grant if they trade through a limited company or a trust; and
• have traded in both the tax years 2018/2019 and 2019/2020.

For the third SEISS grant your clients must also:

• either be currently trading but are impacted by reduced activity, capacity or demand, or have been previously trading but are temporarily unable to do so due to coronavirus;
• declare that they intend to continue to trade, and that they reasonably believe that the impact on their business will cause a significant reduction in their trading profits;
• only claim if the reduction in profits is caused by reduced business activity, capacity or demand, or inability to trade due to coronavirus – reduction in profits due to increased costs (such as having to buy masks) does not count for this purpose.

When deciding whether the reduction is significant, your clients will need to consider their wider business circumstances. HMRC expects claimants to make an honest assessment about whether they reasonably believe their trading profits will be significantly reduced compared to what they would otherwise expect to achieve during this period.

The business must have been impacted on or after 1 November 2020. Your clients must keep evidence to show the impact and reduction in their business activity across the qualifying period.

HMRC is also contacting all self-employed people in the UK that may be eligible to let them know about the third grant.

Free live webinars on the SEISS grant extension are also available.