Self-employed income support scheme third grant now doubled for November 2020

Nov 03, 2020

The Government announced just yesterday evening that the third self-employed income support scheme (“SEISS”) grant will be doubled from 40 per cent to 80 per cent for the month of November 2020 only. The third grant will also now be paid earlier than originally planned and will be available to claim two weeks earlier from 30 November 2020 instead of the original date of 14 December 2020.

Although two further SEISS grants (the third and fourth grants under this scheme) were announced in the September Winter Economy plan on 23 September 2020, the third self-employed income support scheme (“SEISS”) grant is being increased again. Originally this was to be a taxable grant to cover 20 per cent of average monthly trading profits, and capped at £1,875 in total.

However, on 22 October 2020 this was increased from 20 per cent to 40 per cent capped at £3,750. Yesterday’s announcement confirms that the third grant will double for the month of November 2020 only to 80 per cent of trading profits.

To be eligible for the SEISS grant extension self-employed individuals, including members of partnerships, must:

  • have previously been eligible for the SEISS first and second grants (although they do not have to have claimed the previous grants); and
  • declare that they intend to continue to trade and either:
  • are currently actively trading but are impacted by reduced demand due to coronavirus; or
  • were previously trading but are temporarily unable to do so due to coronavirus.

As set out in the Winter Economy Plan, the SEISS extension will last for six months, from November 2020 to April 2021. The third and fourth grants will be paid in two lump sum instalments each covering a three-month period.

The third grant will cover the three-month period from 1 November 2020 to 31 January 2021. This will be a taxable grant covering 55 per cent of average monthly trading profits, paid out in a single instalment covering three months’ worth of profits, and capped at £5,160 in total.

The fourth taxable grant will cover a three-month period from 1 February 2021 until 30 April 2021. The Government will review the level of the fourth grant and set this in due course.

Readers are reminded that the grants are taxable income and are also subject to Class 4 and Class 2 National Insurance contributions.