SEISS 5th Grant - Query on turnover

Blooo

Reading from HMRC's site on the 5th SESISS Grant it states:

The amount of the fifth grant will be determined by how much your turnover has been reduced in the year April 2020 to April 2021.

The fifth grant will be worth:

• 80% of 3 months’ average trading profits, capped at £7,500, for those with a turnover reduction of 30% or more

• 30% of 3 months’ average trading profits, capped at £2,850, for those with a turnover reduction of less than 30%

I note it's now based on how much your turnover has been reduced. My turnover without Grants 1, 2, 3 & 4 would be a reduction of roughly 60%. However if the turnover reduction is 'including' the grants I have already claimed then the turnover is about the same .

Any ideas?

lisastevo

If you do your accounts on simplified cash basis then SEISS 4 wouldn’t be paid until the end of April so would fall in the 2021/2022 tax year if that would make a difference. That’s my understanding. I’m no expert though. 

Jeremy535897

Blooo said:

Reading from HMRC's site on the 5th SESISS Grant it states:

The amount of the fifth grant will be determined by how much your turnover has been reduced in the year April 2020 to April 2021.

The fifth grant will be worth:

• 80% of 3 months’ average trading profits, capped at £7,500, for those with a turnover reduction of 30% or more

• 30% of 3 months’ average trading profits, capped at £2,850, for those with a turnover reduction of less than 30%

I note it's now based on how much your turnover has been reduced. My turnover without Grants 1, 2, 3 & 4 would be a reduction of roughly 60%. However if the turnover reduction is 'including' the grants I have already claimed then the turnover is about the same .

Any ideas?

Further details are to be published, but grant income is not "turnover".

LHZ

I wondered about this too. Without the previous 3 Grants I'm 45% down turnover wise so eligible for the 5th Grant but with the Grants included I'm about the same. The 4th Grant will be received after 5th April so will go in my next year accounts (2021/22).
I attended a HMRC webinar a few months ago concerning the 3rd Grant eligibility and they stated that any eligibility calculations do not include Grants paid out so hopefully I'm eligible for the 5th.

lisastevo

I’m 42% down including grants and 80% without the grants so I’m going to be ok either way thankfully. COVID well and truly screwed me over. Without the grants I would’ve been been ruined. I’m in entertainment industry including overseas travel so still can’t see the end to be honest as Brexit has screwed that too.

Jeremy535897

lisastevo said:

If you do your accounts on simplified cash basis then SEISS 4 wouldn’t be paid until the end of April so would fall in the 2021/2022 tax year if that would make a difference. That’s my understanding. I’m no expert though. 

It doesn't matter. The legislation will state that SEISS grants are taxable when received, whatever accounting method used. Grants are not turnover. The test being referred to in SEISS 3 was whether trading profits had been significantly reduced. Profits was not to include SEISS grants, so it would be extraordinary if SEISS grants were included in turnover, but the final details are still to be published.

LHZ

Jeremy535897 said:

lisastevo said:

If you do your accounts on simplified cash basis then SEISS 4 wouldn’t be paid until the end of April so would fall in the 2021/2022 tax year if that would make a difference. That’s my understanding. I’m no expert though. 

It doesn't matter. The legislation will state that SEISS grants are taxable when received, whatever accounting method used. Grants are not turnover. The test being referred to in SEISS 3 was whether trading profits had been significantly reduced. Profits was not to include SEISS grants, so it would be extraordinary if SEISS grants were included in turnover, but the final details are still to be published.

So this means 4th Grant is included in 21/22?  Hope so otherwise my 20/21 tax bill will be higher.

Jeremy535897

See https://www.gov.uk/government/publications/updates-to-taxation-of-the-self-employment-income-support-scheme-grants-for-income-tax/taxation-of-the-self-employment-income-support-scheme-grant-for-income-tax

LHZ

Jeremy535897 said:

See https://www.gov.uk/government/publications/updates-to-taxation-of-the-self-employment-income-support-scheme-grants-for-income-tax/taxation-of-the-self-employment-income-support-scheme-grant-for-income-tax

So that's a "Yes" then :-)

Jeremy535897

LHZ said:

Jeremy535897 said:

See https://www.gov.uk/government/publications/updates-to-taxation-of-the-self-employment-income-support-scheme-grants-for-income-tax/taxation-of-the-self-employment-income-support-scheme-grant-for-income-tax

So that's a "Yes" then :-)

If enacted, as it inevitably will be, yes.

justwhat

Blooo said:

Reading from HMRC's site on the 5th SESISS Grant it states:

The amount of the fifth grant will be determined by how much your turnover has been reduced in the year April 2020 to April 2021.

The fifth grant will be worth:

• 80% of 3 months’ average trading profits, capped at £7,500, for those with a turnover reduction of 30% or more

• 30% of 3 months’ average trading profits, capped at £2,850, for those with a turnover reduction of less than 30%

I note it's now based on how much your turnover has been reduced. My turnover without Grants 1, 2, 3 & 4 would be a reduction of roughly 60%. However if the turnover reduction is 'including' the grants I have already claimed then the turnover is about the same .

Any ideas?

So .......lol 20/21 tax return is not legally due in.  Does that mean its a geustimate?
And turnover reduced in comparison to last year or the average of 3 years?