For the self-employed you can make a claim for your second, and final grant from HMRC from 17 August.
Here is everything that you need to know about it:
The Second Grant
If you were eligible to claim first time round, then you can claim again, and HMRC will use the same basis for calculating the amount due to you this time.
The scheme this time allows you to claim a grant worth 70% of your average monthly trading profits, paid out in a single instalment covering 3 months’ worth of profits, and capped at £6,570 in total. The first grant was based on 80%, subject to a cap of £7,500.
As before HMRC will contact you if they believe are eligible to claim the second grant.
Claims have to be made by 19 October 2020, and HMRC aim to send you the money within 6 working days of your claim. In most cases grants were received quickly last time.
You don’t have to have made a claim for the first grant, to be able to claim the second. It could be that your business was not initially affected by the virus, but has been since 14 July.
Also a reminder that the grant does not need to be repaid, but it is subject to income tax and self-employed National Insurance.
The grants will need to be reported on your 20/21 tax return, and also disclosed as self-employed income for any Universal Credits or tax credits claim.
Information has also been released about the records that you need to keep in relation to the grant.
You must keep:
- Details of the amount claimed
- The grant claim reference
- Evidence that your business has been adversely affected by the coronavirus at the time you made your claim. This could be:
- Business accounts showing a reduction in turnover
- Dates you had to close due to lock-down restrictions
- Dates you were unable to work due to coronavirus symptoms, shielding or caring responsibilities
- Evidence of a contract being cancelled
- Confirmation of any coronavirus related business loans received
New provisions have also been introduced to tell you what to do if you believe the last claim that you made to be incorrect, or you believe HMRC made an error.
If you received a grant, and now do not think you were actually eligible, or you were overpaid, then if you received the grant:
- before 22 July 2020 you must tell HMRC on or before 20 October 2020
- on or after 22 July 2020 you must tell us within 90 days of receiving the grant
If you do not you may have to pay a penalty, which could be up to 100% of the grant!
As with the last grant, it is the individual that needs to make the claim with HMRC – their agent/accountant is not able to do this for their clients. But if you do need help with working out what you can claim, or what records you may need to keep, then please get in touch with Rosie Forsyth of Wilkins & Co.