4TH SEISS Grant does 25% constitute a 'significant reduction in profits' ???

LHZ

As per title, just wanted to get some thoughts on whether a 25% reduction in profits constitutes a 'significant reduction in profits'?

Jeremy535897

My own opinion is that it does, unless the profits themselves were trivial (a reduction in profit from £100 to £80 is not significant in absolute terms).

textbook

Over what period?

LHZ

Jeremy535897 said:

My own opinion is that it does, unless the profits themselves were trivial (a reduction in profit from £100 to £80 is not significant in absolute terms).

Many thanks. Certainly not trivial amounts - I was worryingly close to the higher rate tax bracket in 19/20.  My turnover is down around 45% over the 4 months between Jan 21 and April 21 compared to the same months pre-covid.  It's not that straight forward to calculate my operating profits but I did a conservative worst case scenario (ie the 'least' % of profit loss) and I came up with 25% (my transport costs were significant pre-covid but now are are virtually nil so my profits haven't dipped in the same way that my turnover has).  It could be closer to 30% in reality but I can confidently say my profits are 25% down over the 4 months period relating to the 4th SEISS.  I've booked myself on to another HMRC webinar next week so will ask the question there but still keen to hear from others.

textbook said:

Over what period?

Jan 21 to April 21 as per the 4th SEISS

LHZ

Quick update: I attended a HMRC webinar yesterday and asked the question via the chat box during the presentation. They wouldn't be drawn to comment directly on my or anybody else's personalised questions regarding what qualifies as a significant reduction in profit, stating that it is down to the individual to make an assessment on whether they feel they have, or will most likely, suffer a significant loss of profit for the period in question. 

I have applied for the 4th SEISS grant safe in the knowledge that I am doing the right thing.