Budget 2021: self employed grants extended
As part of the government’s covid support package, the Chancellor confirmed further extension of the self-employed income support scheme (SEISS) with two new tranches of grant
The government confirmed that the fourth SEISS grant will be worth 80% of three months’ average trading profits, paid out in a single instalment and capped at £7,500 in total. The grant will cover the period February to April and can be claimed from late April. Self-employed individuals must have filed a 2019-20 self-assessment tax return to be eligible for the fourth grant. This means that over 600,000 individuals may be newly eligible for SEISS, including many new to self-employment in 2019-20. All other eligibility criteria will remain the same as the third grant. Further details will be published in due course. There will also be a fifth and final SEISS grant covering May to September. The value of the grant will be determined by a turnover test, to ensure that support is targeted at those who need it the most as the economy reopens. People whose turnover has fallen by 30% or more will continue to receive the full grant worth 80% of three months’ average trading profits, capped at £7,500. People whose turnover has fallen by less than 30% will receive a 30% grant, capped at £2,850. The final grant can be claimed from late July. Further details will be published in due course. Joanne Harris, technical-commercial manager at Nixon Williams said: ‘Sole traders have been eagerly anticipating this budget for news on the fourth SEISS grant and will be pleased that the Chancellor has extended the scheme in line with the CJRS. In addition to the confirmation of a 4th grant, the Chancellor also confirmed a 5th and final grant that will take us to September. ‘The government has also opened these grants to the recently self-employed as it now has information from the 2019/20 tax returns. Whilst this is great news for this previously excluded group there are still many left behind, including directors of small limited companies. ‘There was an opportunity in this budget to go further and consider the needs of freelancers and contractors with a limited company set-up, who have essentially been overlooked in terms of appropriate government support so far. The proposal on the table for a Directors Income Support Scheme (DISS) was credible and could have helped millions of more people, but the government appears to have ignored this completely.’ Since it was launched in 2020, the Self-Employment Income Support Scheme (SEISS) has helped around 2.7 million self-employed people across the UK.
Courtesy: Accountancy Daily