Self-Employment Income Support Scheme Grant Extension

It’s been a week since the Chancellor, Rishi Sunak, announced that both the Coronavirus Job Retention Scheme (CJRS) and the Self-Employment Income Support Scheme (SEISS) would be extended.

The news that the SEISS is being extended is welcomed by those who face the ever-growing pressure of a second lockdown and a year of turmoil for business. 

The SEISS grant will extend twice more, lasting for six months from November 2020 to April 2021. The Chancellor announced that the scheme will be paid in two lump sum instalments, each covering a three month period. 

The first of the two new grants will cover the three months from 1 November 2020 – 31 January 2021, worth 80% of past average monthly trading profits, paid out in a single instalment and capped at £7,500 in total.

Following this the government has announced there will be the second of the two new grants covering February 2021- April 2021, details of this support are yet to be set out. 

Who Can Claim?

The grants, which are both taxable and subject to National Insurance contributions are welcomed by those who meet the criteria. But, just who can claim?

To be eligible for the SEISS grant extension self-employed individuals must; 

• have been previously eligible for the Self-Employment Income Support Scheme first and second grant (although they do not have to have claimed the previous grants),
• declare that they intend to continue to trade and either:
  • are currently actively trading but are impacted by reduced demand due to coronavirus,
  • were previously trading but are temporarily unable to do so due to coronavirus.

This same eligibility applies to those who are members of a partnership. 

The Chancellor added, when making the announcement, that the grants would be paid faster than previously planned – it is expected that the claims window will open at the end of November. 

HMRC will provide full details about claiming and applications in guidance on gov.uk in due course.

You will need your Self Assessment Unique Taxpayer Reference (UTR), your National Insurance number, your Government Gateway user ID and password and a UK bank account.

The Association of Independent Professionals and the Self-Employed, (IPSE) has advised the self-employed to keep evidence of the impact that COVID-19 has had on their businesses, ensuring the following;

• Accounts showing a decrease in turnover or an increase in costs,
• Dates that your business had to close due to lockdown restrictions and/or that you or your staff were unable to work due to coronavirus symptoms, shielding or caring responsibilities,
• Confirmation of coronavirus-related business loans received,
• Examples of contracts or projects being delayed or cancelled.

Coronavirus Job Retention Scheme (CJRS)

In the more straightforward case of furloughed staff, employers won’t cover wages for hours not worked but are asked to cover National Insurance and employer pension contributions. Meaning those receiving support from the Coronavirus Job Retention Scheme (CJRS) will receive 80% of their current salary for any hours not being worked over the next five months, until the end of March 2021. 

For employers, who’s intentions were to keep people in work until the end of January this does mean that the Jobs Retention Bonus (JRB) won’t be received in February 2021 as planned – with the government announcing they will look at this again at the appropriate time. 

The CJRS extension will be reviewed in January to examine whether the economic circumstances are improving enough for employers to be asked to increase contributions.

Further Information

More information policy announcements can be found here: economic support factsheet.