Applications for the third Self Employment Income Support Scheme (SEISS) opened on 30 November, providing relief to those whose income has been impacted by lockdown.
Here's who is eligible and how to apply for support.
Who is eligible for the Self Employment Income Support Scheme (SEISS)?
To make a claim for the third grant your business must have had a new or continuing impact from coronavirus between 1 November 2020 and 29 January 2021, which will have a significant reduction to your profits.
HMRC’s guidance states that members of a partnership can also claim, and support will be based on their share of the partnership’s profit.
Applicants must be able to prove that they plan to continue trading, or providing a service, beyond the end of the support, which is expected to cover November until the end of April, according to the Government website.
Traders who are continuing to trade but who face restrictions which impact their profit making, or who are unable to trade, are eligible.
What am I entitled to?
Funding for self-employed workers has been increased to 80% for the three months of November, January and February.
Similar to during the first lockdown, there will be two grants available to cover the next six months and each will cover three months and be paid in two lump sums.
The third SEISS grant will pay profits up to 80%, capped at £7,500 in total to cover the three months’ worth of profit – support payments will be taxable.
If you are self-employed but also engage in employment for another business, you can apply for support to counteract your loss of self-employed profits as long as this constitutes over 50% of your overall taxable earnings.
According to the chancellor, Rishi Sunak, this will result in £4.5bn of support from Westminster over the next three months.
The next instalment will cover February, March and April with the criteria and level of support yet to be confirmed.
How do I apply?
Applications are now open, you can start your application here, and those who are eligible should have been contacted by HMRC.
Guidance on how to submit proof of earning and how your trade has been impacted by the lockdown is available on the HMRC website.
Are there gaps in support?
The Government has been criticised for its lack of support to a number of workers who are self-employed but ineligible for various reasons.
The funds are only available to those who can provide tax returns for the 2018/2019 financial year.
Therefore, if you became self employed during 2019 or 2020, or you did not file tax returns during the 2018/2019 financial year then you will not receive support.
On the other hand, if you have succeeded in profits of £50,000 you are also not eligible.
The rules make things particularly difficult for freelancers since anyone who cannot prove that more than half of their income came from self-employment rather than contractual work will not be eligible, as they were not entitled to support in the first two grants.
The Association of Independent Professionals and the Self-Employed (IPSE) chief executive, Derek Cribb, has highlighted that due to the high number of newly self-employed people, a third of the self employed workforce will lose out.
He said: "It is deeply troubling that the government has still not fixed the devastating gaps in SEISS, despite urgent recommendations from the Treasury Select Committee. After so many calls to resolve the problems, it now looks as if the government is wilfully ignoring a third of the self-employed.”(BBC)
Self-employment has increased dramatically since the 2008 financial crash, however this year has been a drastic fall in the number of people registered.