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UK cab trade debate and advice
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PostPosted: Wed Mar 03, 2021 6:14 pm 
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Sussex wrote:
The 2019-2020 return will include Feb and March 2020 which was when many self-employed were earning sweet FA, due to the issues the SEISS is meant to help alleviate.

Not clear whether they're using 2019-20 to calculate the grant figures, though, rather than simply for whether you're eligible.

And a couple of lean months shouldn't make too much difference for the grant figures anyway, assuming they're still using a three year average. By the looks of it they haven't actually decided that yet, but let's hope they don't base it *only* on 2019-20, which could then make a good bit of difference :roll:

Not to me, personally, because my 2019-20 tax return based on year ended 30 November 2019, thus before it all happened, and my profit wasn't hugely different to previous years.


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PostPosted: Wed Mar 03, 2021 6:26 pm 
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grandad wrote:
I am fairly sure that he said that the 4th and 5th payments for those who qualified for the first 3 payment would be the same as those but people who submitted their 2019/20 tax return by midnight last night can claim for the 4th and 5th payments based on those figures.

Not sure he said that, at least in the bit of the speech I saw, although that was what I was assuming would happen, and the latest tax returns would only impact on the newly self-employed.

But this is the official HMRC blurb published since then:

HMRC wrote:
Your eligibility for the scheme will now be based on your submitted 2019 to 2020 tax return. This may also affect the amount of the fourth grant which could be higher or lower than previous grants you may have received.

But the highlighted word 'may' suggests they haven't actually decided yet :?

Grandad wrote:
So if you got £5000 in the first 3 payments then you will get £5,000 for the 4th and 5th payments. Those that did not qualify for the first 3 payment but now qualify will get 80% of their profits pro rata.

£5,000?? :-o :mrgreen:

Pedantic point - even if the same figures *are* used, the second grant was of course calculated at 70% rather than 80%.


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PostPosted: Wed Mar 03, 2021 9:35 pm 
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Got email from HMRC tonight, and it looks like it will be averaged over the four years rather than three, as I suggested earlier:
HMRC wrote:
The value of the grant is based on an average of your trading profits for up to four tax years between 2016 to 2020, where available.

So if that includes early 2020 for you, and you did badly then because of Covid, then that would bring your numbers down a bit. But, in truth, a couple of lean months won't be catastrophic over a four year average.

As I said, my financial year ended on 30 November 2019, and it wasn't a whole lot different to the previous three years on which past grants were based, so my future grants shouldn't be a whole lot different.

Of course, it could even work in your favour if your latest tax return showed an increase in profits :-o


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PostPosted: Wed Mar 03, 2021 11:44 pm 
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So suppose your average profit over the three years they've been using was £20,000.

Your last grant @ the 80% rate would have been £4,000.

So in the last tax year, suppose you lost £4,000 profit because of Covid, and your profit was £16,000.

Your average over the four years would then be £19,000. Your grant @ 80% would be £3,800.

So you'd lose £200 for the three month grant @ 80%. Not good, but hardly a catastrophe.

And that's maybe a worse case scenario - I've assumed profits for the tax year to April 2020 are down 20% because of Covid, which is probably unlikely because lockdown only covered a couple of months.

In fact my profit for the last tax year was up slightly on the three-year average, so if my figures are correct my next grant will be about £12 higher :-o

Anyway, all that's assuming they're averaging profits over the past four years rather than three.

And, of course, your profits for the last tax year could have gone up or down significantly for reasons other than Covid :?


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PostPosted: Thu Mar 04, 2021 6:02 am 
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Location: Stamford Britains prettiest town till SKDC ruined it
I have seen the 5th grant stated on the internet as based on 2020/2021 turnover so presumably to qualify we'll have to be early with our tax returns

which for the IR is probably a great deal of hard work as they will not normally have to deal with many that early

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PostPosted: Thu Mar 04, 2021 8:02 am 
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edders23 wrote:
I have seen the 5th grant stated on the internet as based on 2020/2021 turnover so presumably to qualify we'll have to be early with our tax returns

which for the IR is probably a great deal of hard work as they will not normally have to deal with many that early

I don't think that is correct.

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PostPosted: Wed Apr 14, 2021 11:57 am 
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Location: 1066 Country
Just received an email saying I can claim 4th grant on the 23/4/21.

Which just happens to be St George’s Day.

Check your inboxes fellas.

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