Guidance on how different circumstances affect the Self-employment Income Support Scheme

06 May 2020

Ahead of the launch of the Self-employment Income Support Scheme (SEISS), HMRC has published detailed information that confirms how a variety of circumstances will affect an individual’s eligibility for the scheme.

As with all of the guidance relating to the measures implemented by the government as a result of COVID-19, the CIPP would like to remind its readership to keep visiting the associated guidance pages, as they are regularly updated, and it is imperative to familiarise yourselves with the most up to date information.

If an individual’s Self-Assessment tax return is late, amended or under enquiry

If an individual did not submit their Self-Assessment tax return for the year 2018-19 on, or prior to 23 April 2020, then they will not be eligible for the scheme, or be able to submit a claim.

Claims based on late returns submitted between the dates 26 March 2020 and 23 April 2020 will be subject to extra anti-fraud checks by HMRC.

When establishing eligibility or the amount of the grant, HMRC will not consider Self-Assessment tax returns for the tax years 2016-17 or 2017-18, where they were not submitted by 23 April 2020.

HMRC will use data on the tax returns already submitted to identify those eligible to claim.

When establishing eligibility or the amount of the grant, HMRC will not consider any amendments made to submitted returns after 18:00 on 26 March 2020.

Information on the original return will only be used where a tax return is either under enquiry or has been the subject of a contract settlement.

Members of a partnership

Each partner within a partnership will be required to make claims based on their own individual circumstances, and HMRC will determine eligibility based on their share of the partnership’s trading profits.

Those who are on, or have taken, parental leave

Self-employed individuals who apply for the scheme but are currently taking a break to take a period of parental leave or have done since 6 April 2019 could potentially still be eligible as HMRC will regard them as still trading.

If an individual is claiming Maternity Allowance, this will not affect their eligibility for the grant.

Individuals who have loans covered by the loan charge, but who did not agree a settlement with HMRC before 20 December 2019

Individuals who have received payment for work or services in the form of a loan or any other form of credit covered by the loan charge may be able to claim the grant if they were self-employed in the tax year 2017-18 and have submitted the associated Self-Assessment tax return. This is also applicable if loans will be removed from the loan charge as a result of the changes announced by the government as a result of the independent review into the loan charge.

HMRC will establish eligibility and average trading profits on either the average of the tax years 2016-17 and 2017-18, or the tax year 2017-18 if the individual was not self-employed in the tax year 2016-17.

The 2018-19 Self-Assessment tax return deadline did not have to be filed by 23 April 2020 but should be filed by 30 September 2020.

Individuals who claim averaging relief

For individuals who are self-employed farmers, market gardeners, creative authors or artists, HMRC will calculate eligibility for the scheme and the amount of the grant based on the amount of profit prior to the impact of the averaging claims.

Individuals who are non-residents or who chose the remittance basis

Individuals may be eligible for the grant if they’re self-employed and either not a resident in the UK or a resident in the UK that has chosen the remittance basis.

These individuals will need to confirm to HMRC that their UK trading profits are at least equal to their other worldwide income.

Individuals who are above the state aid limits

The SEISS is a state aid granted under the European Commission’s Temporary Framework for state aid, which was designed to respond to COVID-19.

If an individual is already above the state aid limits, or if claiming the grant would push them above the limits then they should not claim this grant.

Businesses may only receive a maximum of €800,000 under the Temporary Framework. This reduces to €120,000 for the agriculture/aquaculture sector or €100,000 per undertaking active in the primary production of agricultural products.

This limit applies to any aid claimed across all measures granted under the terms of the European Commission’s Temporary Framework, and not just any aid provided through the SEISS.

The euro equivalent of the Sterling aid amount will be calculated with the commission exchange rate operative on the date that the aid is offered.

If businesses operate in more than one sector, which have different state aid ceilings, individuals should keep separate accounts to avoid exceeding the limits and cross-subsidisation of aid across different sectors.

The aid must be granted by 31 December 2020.

The aid is in addition to any de minimis state aid.


The information in this article is accurate at the time of publication. For all the latest information, news and resources on how the COVID-19 pandemic is affecting payroll professions, visit our Coronavirus hub.