Updated: Jul 12, 2020
The Government’s second Self-Employed Income Support Scheme (SEISS) payment will only be payable if the claimant’s business has been affected by COVID-19 from 14 July, says financial expert.
Further guidance on the support package offered to millions of self employed workers, which includes thousands of taxi drivers, is likely to be announced on Friday 19 June.
Martin Lewis, a financial journalist and founder of MoneySavingExpert.com, examined early guidance notes which contained what he described as a “bizarre new second Self-Employed grant rule”.
Lewis goes on to say via his popular Facebook page: “Bizarre new second SELF EMPLOYMENT grant rule, it's now only for businesses affected by Covid on or after 14 July.
“On Friday, the technical guidance for the second Self Employment Income Support scheme came out. Most was as flagged, but then we spotted, "you will have to confirm your business has been adversely affected on or after 14 July 2020." So since, we've been digging into it.”
Under the first grant, eligible individuals can claim a taxable grant worth 80% of their average monthly trading profits, paid out in a single instalment covering three months’ worth of profits, and capped at £7,500 in total. Those eligible have the money paid into their bank account within six working days of completing a claim and covered the impact of COVID-19 during the months of March, April and May.
Self-employed individuals can continue to apply for the first SEISS grant until 13 July.
Applications for the second grant will open in August. This time individuals will be able to claim a second taxable grant worth 70% of their average monthly trading profits, paid out in a single instalment covering three months’ worth of profits, and capped at £6,570 in total.
It’s worth noting that the eligibility criteria is the same for both grants and individuals will need to confirm that their business has been adversely affected by coronavirus.
However, unlike the first payment which covered the specific months of March, April and May, the second payment seems to skip any impact faced in June and the first two weeks of July.
Martin Lewis continued: “As the govt's own press release from 26 March 2020 stated "The income support scheme... will cover the three months to May" ie March, April and May. Logic (and basic counting) therefore suggests the second 3 month grant covers June, July and August.
“So it's very strange to read the new rule that says you have to declare your business was impacted after mid-July, and unfair on businesses heavily impacted in June and recovered by then.
“Having spoken to HMRC, apparently the grants don't [now?] relate to a specific 3mth time period, they are just grants [though based on 3mths of trading profits].
The rules are simple. The first grant is for those whose 'business was impacted by Covid-19 before 13 July' and the second, which comes in August, for those 'impacted by Covid-19 on or after 14 July'. If impacted before and after the dates, you are due both.
“So the new rules are clear. But the implication and message this sends is as clear as mud. If as the government announced the first 'three-month' covered March, April, May, but also now sort-of June and half of July, what does the second 'three-month' grant cover?”
So what counts as being impacted by COVID-19?
Martin Lewis suggests obvious signs such as:
you or your staff have been unable to work due to the virus
you can't access your usual place of work
your revenue has been negatively impacted.
Currently work levels in the taxi industry are heavily reduced when compared with levels pre-lockdown. Whilst lockdown measures continue to ease, it remains unlikely that the taxi industry will recover fully by the 14 July.