Eligibility for the scheme is worked out the same way as it was for the first grant but the maximum amount payable is capped at £6,750 or 70% of average trading profits over the past three tax years.
This will be worked out by adding together the total trading profits or losses for the past three tax years then dividing the total by three.
When grant allowance is distributed, if the claim is approved, it will be paid directly into the claimant’s bank account in one instalment within six working days.
A self-employed individual or member of a partnership can claim and if they have:
- Traded in the tax year 2018 to 2019 and submitted a self-assessment tax return on or before 23 April 2020 for that year
- Traded in the tax year 2019 to 2020
- Intend to continue trading in the tax year 2020 to 2021
- Carry on a trade that has been adversely affected by coronavirus
You can make a claim even if you didn’t for the first grant if your business has been adversely affected on or after 14 July, as well as meeting all the criteria above. Claims must be made on or before 19 October 2020.
Handy tips
Ensure you have your self-assessment unique taxpayer reference (UTR), national insurance number, Government Gateway user ID and password, and bank details to hand and visit https://www.gov.uk/guidance/claim-a-grant-through-the-self-employment-income-support-scheme.
To check you are eligible to claim, you will first be asked to enter your UTR before entering your national insurance number. This will then tell you when you will be able to make a claim from and you will be asked to add your contact details, which will be used to tell you when to claim and what you need to do beforehand.
Next, you will need to use Government Gateway to sign in and add your contact details. The user ID could be up to 12 characters.
You could be asked for an access code so ensure your mobile phone is nearby.
You will then be asked for your email address and mobile number so HMRC can contact you when you make a claim.
From here, it will then tell you the date and time from when you can claim.
Record keeping
After claiming, you will be told straight away if the grant has been approved.
All records must be kept in line with normal self-employed record keeping requirements, including the amount claimed, the claim reference number for your records and evidence your business has been adversely affected by coronavirus.
You will need to report the grant on your self-assessment tax return. You will also need to report it as self-employed income for any Universal Credit claims and it will need to be recorded as self-employed income and you are working 16 hours a week for any tax credit claims.
If you think you were not eligible for the grant or have been overpaid, you must tell HMRC and pay back the grant.
If you received the grant before 22 July 2020, you must tell HMRC before 20 October 2020.
If you received it on or after 22 July 2020, you must tell HMRC within 90 days of receiving it. If you do not inform HMRC, you may have to pay a penalty.