SEISS grant: How is fourth self-employed grant calculated? When is SEISS paid?

Martin Lewis grills Rishi Sunak over SEISS timetable

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The Self-Employment Income Support Scheme (SEISS) has proved vital to several self-employed people over the course of the pandemic. The scheme has already offered three grants, and it’s now been confirmed that a fourth grant will cover February to April 2021. To the delight of swathes of newly self-employed people, the eligibility criteria for SEISS grant four has now been expanded.

To get the fourth SEISS grant, self-employed people need to have traded in the 2019 to 2020 tax year and have submitted their tax return by March 2, 2021.

The claimant must also have traded in the 2020 to 2021 tax year to get the grant.

The Chancellor said in the Budget on March 3: “When the scheme was launched, the newly self-employed couldn’t qualify because they hadn’t all filed a 2019/20 tax return.

“But as the tax return deadline has now passed, I can announce today that, provided they filed a tax return by midnight last night, over 600,000 more people, many of whom only became self-employed last year, can now claim the fourth and fifth grants.”

How is the fourth grant calculated?

The fourth SEISS grant is worth 80 percent of average monthly trading profits, capped at £7,500.

The total fourth grant will cover the three-month period of February to April 2021.

Further details on the terms of the fourth grant are expected to be announced soon.

However, the current policy guidance explains tax returns are used by HMRC to calculate SEISS grants.

The Government website explains: “To work out your eligibility we will first look at your 2019 to 2020 Self Assessment tax return.

“Your trading profits must be no more than £50,000 and at least equal to your non-trading income.

“If you’re not eligible based on your 2019 to 2020 Self Assessment tax return, we will then look at the tax years 2016 to 2017, 2017 to 2018, 2018 to 2019 and 2019 to 2020.”

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The fifth grant is calculated slightly differently from the fourth SEISS grant.

People who have seen a drop in turnover of 30 percent or more will be entitled to a grant worth 80 percent of average monthly trading profits, capped at £7,500.

However for people whose turnover has not decreased by 30 percent or above, the fifth grant will be worth less than this.

In this case, the fifth grant will be worth 30 percent of average monthly trading profits, capped at £2,850 for the three-month period.

Rishi Sunak told MPs in his Budget announcement: “People whose turnover has fallen by less than 30 percent will therefore have less need of taxpayer support and will receive a 30 per cent grant.”

When is SEISS paid?

Applications for SEISS grant four will be open from late April until May 31, 2021.

People who are eligible for SEISS will be contacted by HMRC in mid-April with a personal claim date.

From this date, eligible claimants will be able to submit their claims for the fourth grant.

Previously, HMRC has aimed to pay out SEISS claims within six working days from a claim being accepted.

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