Explained: The latest self-employed grant scheme and how to apply

Self-employed people have been hit hard by the pandemic, with many freelancers and gig economy workers seeing their client base and demand evaporate during lockdowns, and be significantly reduced in the intervening months. 

The Government has been under pressure to provide more support for these self-employed people, many of whom are small business owners. 

On Monday it opened applications for the latest Government grant on offer to people who work for themselves. 

Here we explain what is on offer, who is eligible, and how to apply.

What is the SEISS?

The Self-Employment Income Support Scheme (SEISS) offers taxable Government grants for people who work for themselves.  The SEISS opened its third grant to applications on Monday, and a fourth will be offered in February 2021.

Who can apply for the SEISS?

Crucially, you can only apply if you filed a tax return for the last tax year (2018-19).

Applicants must be able to show their business has been and will be hit by the pandemic in the three months from November 1, including a "significant reduction" in trading profits.

All self-employed applicants must still be trading - you can't apply if you're shutting down permanently.  

Every applicant has to earn at least 50% of their income from self-employment, and make trading profits of less than £50,000 per year.

The application period runs until January 29.

What period does the SEISS cover and how much will I get?

The third grant spans the period from November 1 to January 29 2021.

It works in a similar way to the Coronavirus Job Retention Scheme, also known as the furlough scheme, for employees. It will offer self-employed people 80% of their average monthly trading profits, capped at £2,500 per month, for three months.

HMRC looks at every self-employed application's tax returns for the 2016-17, 2017-18 and 2018-19 years to calculate how much an applicant is owed.

What do I need to make a self-employment grant claim?

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

How long does it take to get the self-employment grant?

The idea is for the financial support to get to self-employed people as fast as possible.

The Government website states: "We will check your claim and pay your grant into your bank account within 6 working days."

It says that applicants will be sent an email when payment is on its way.

Will I have to pay  the Government grant back if my business recovers?

No. The Government states on its website that "if your business recovers after you’ve claimed, your eligibility will not be affected as this is based on your reasonable belief that your trading profits would have been significantly reduced at the time you made your claim".

Applicants are being told they "must keep evidence to support your claim".