Understanding Phase 3 of the SEISS grant

(Updated on 27th November following Government changes)

It’s recently been announced that the government’s Self-Employed Income Support Scheme (SEISS) has been extended, so there’ll now be two more grants available to claim in the coming months.

This is to help alleviate financial strain for those whose income is reduced because of the pandemic – although it’s important to note that the first grant in the SEISS extension will be just 40% of your average monthly trading profits, as opposed to the 70% of previous grant (recently changed by the Government – previously was only 20%).

The new SEISS dates you’ll need to know

The extended SEISS scheme, or SEISS phase 3, will run from 1st November 2020 – April 2020. 

This period will be split into two blocks, one from November 2020 – January 2021, and the other from February 2021 – April 2021. 

An individual grant will be available within each of these periods – so two in total. You’re allowed to claim both of these, if you need them. 

It’s important to note that you can only apply for the grants if you’ve been affected within the allocated time period for that grant. So for the first one, you’ll need to be affected between November 2020 – January 2021. Basically, you can’t apply for a grant based on the fact you were affected months ago if Covid is no longer impacting your income within the current SEISS period.

Who can claim the new SEISS grants?

You can claim the new SEISS grants if you’re already eligible for the scheme – take a look at our article on SEISS phase 2 for a full breakdown of who can apply (but don’t forget, the new dates listed above now apply). 

You don’t need to have actually claimed one of the previous SEISS grants to be able to claim the upcoming ones. 

How much is available under the extended SEISS? 

For the first grant of the extended scheme (so the one running up to the end of January 2021), you can get 40% of your average monthly trading profits. You’ll get the money in one lump sum, which will be capped at £3,750. 

The government has said it’ll decide on the value of the second grant in SEISS phase 3 closer to the time (so nearer to February 2021). This is because they’ll need to assess the situation as it happens – it’s pretty tough to predict what kind of financial support people will need by then. We’ll be sure to update this article when there’s any more information available.

Are people in PAYE jobs getting more government support than the self-employed?

No – the government support for PAYE jobs has also been reduced, meaning that those in employment and those working for themselves are getting around the same level of financial aid. 

How to apply for SEISS phase 3

When the government opens the scheme officially, you’ll be able to fill out an application form on the .Gov site. You’ll need to be able to prove your earnings, so it’ll be important that you’ve filed a tax return for 2018-2019. If you haven’t because you weren’t trading then, you might be able to claim for a SEISS phase 3 grant using a tax return from 2019-2020 – keep an eye on the government guidance around this when they open the application. 

This could be a good reason to file your Self Assessment early this year, rather than waiting for the January 31st deadline. It’s also worth noting that if you earned more in the year 2019-2020, than in 2018-2019, you may want to use your most recent tax return to evidence your income. But currently, the government hasn’t provided any guidance on this – watch this space and we’ll be sure to keep you updated.

Follow us on Twitter @Finmotweet for regular updates on this topic.

Are the SEISS phase 3 grants taxable?

Yes – as with SEISS phases 1 and 2, you’ll have to pay tax on the money you receive as part of SEISS phase 3.

What if the SEISS phase 3 grants don’t cover me financially?

To hear that the government is reducing it’s next grant to just 20% of your monthly profits is undoubtedly going to be concerning if you’re suffering from a significantly reduced income at the hands of Covid 19. If you’re worried about making ends meet, there may be other support you can seek – like making a claim for Universal Credit.

Head here to find out more >

Confused about taxes?

The world of self-employed tax can be confusing, especially when there are unexpected factors to consider. If you’re struggling to get your head around your taxes – whether because of the Self-Employed Income Support Scheme or something else – we’re here to help. 

Our intelligent tracking lets you easily monitor your income and expenses (including if that income comes from a source like SEISS), and our real-time tax estimates mean you always have full transparency over how much you owe. Plus, our accountants are on hand to help when you choose one of our Self Assessment plans. 

Find out more about how Finmo can help >

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