Third SEISS rules are stricter and more complex

The IPSE has warned that new rules for the third Self-Employment Income Support Scheme (SEISS) may create ‘confusion and a climate of fear’ for those applying.

The third SEISS grant is now available for applications up until 29^th January 2021 and if eligible the applicant will receive a grant worth of 80% paid out in a single instalment, covering three months’ worth of profits and capped at £7,500 in total.

With the previous two grants, applicants had to prove that their business had been ‘adversely affected’ by the pandemic, whereas now, their business has to have been affected by ‘reduced demand’ or be ‘unable to trade.’ They also need to decide if the impact on their business will result in ‘a significant reduction’ in the trading profits for the tax year they’ll be reported in.

Andy Chamberlain, Director of Policy at IPSE (the Association of Independent Professionals and the Self-Employed), said, “We have called for a more focused distribution of SEISS and understand the efforts to target the funds at those most badly affected, but we are concerned these new rules are confusing and risk creating a climate of fear around applying.

“These complex rules may deter many self-employed from claiming support they need – and leave those who do always looking over their shoulder for fear of HMRC demanding the money back.

“If this is the government’s attempt to make SEISS more targeted, it is troubling that it has not taken the opportunity to divert the savings to the one in three freelancers who have still received no support from the scheme.

“We urge the government to look again at the policy solutions that have been presented to it to plug the gaps in SEISS – and not to exclude even more self-employed in need with these new regulations.”

To find out more about contracting please contact Jaime on 01442 795 100 or email jaime.thorpe@dolanaccountancy.com.