Unlike the previous four grants, the fifth grant will be worth different percentages of average trading profits depending on the claimant's circumstances.
The grant will be worth 80% of three months' average trading profits, capped at £7,500, if the claimant has seen a reduction in turnover of 30% or above.
Someone who has seen a reduction in turnover of less than 30% could get a grant worth 30% of three months' average trading profits, capped at £2,850 in total.
To make your claim, you'll need to have 2 different turnover figures. You'll need to work out your turnover for: -
A 12 month period starting between 1 April 2020 and 6 April 2020. The turnover figure should be for all of the taxpayer's businesses, but exclude COVID-19 support payments, such as SEISS grants, eat out to help out payments and local authority grants.
For the previous years turnover, in most cases, you must use the turnover reported in your 2019 to 2020 tax return as a reference year. The figure needs to be (i) based on a 12 month period and (ii) include the total turnover for all your businesses. Your 12-month period does not need to start in April. If 2019 to 2020 was not a normal year for your business, you can use the turnover reported in your 2018 to 2019 tax return.
For those in a partnership, partners will need to provide turnover figures for the partnership as a whole, unless they have other trades, in which case they can use their share of the partnership turnover, with reference to their share in the profits of the partnership.
HMRC will compare these figures to work out how much a claimant will be eligible for.
Those who started trading in 2019/20 and did not trade in any of the tax years 2016/17, 2017/18 or 2018/19 will not be required to provide turnover figures and will receive a grant based on 80% of trading profits. The maximum grant amount is £7,500.
The grant is subject to Income Tax and self-employed National Insurance Contributions. The grant also counts towards your annual allowance for pension contributions.
The online service for the fifth grant will be available from later July 2021.
Further details can be found on the HMRC website - Work out your turnover so you can claim the fifth SEISS grant - GOV.UK (www.gov.uk)