Coronavirus: How your trading conditions affect your eligibility for the Self-Employment Income Support Scheme

News article

Find out what we mean by reduced demand or temporary closure and read examples of how this could affect your eligibility

Claims for the third SEISS grant have now closed.

The last date for making a claim for the third grant was 29 January 2021.

The online claims service for the fourth grant will be available from late April 2021. Find out more about the fourth grant.

This guidance will be updated as soon as possible.

To be able to claim for the third grant, you must either:

  • be currently trading but are impacted by reduced demand due to coronavirus
  • have been trading but are temporarily unable to do so due to coronavirus

You must also:

  • intend to continue to trade
  • reasonably believe there will be a significant reduction in your trading profits due to reduced demand or your inability to trade

You must also meet all other eligibility criteria to make a claim.

HMRC expects you to make an honest assessment about whether you reasonably believe your business will have a significant reduction in profits.

Impacted by reduced demand

This applies to your business if it has been impacted by reduced demand, activity or capacity due to coronavirus.

For example, you:

  • have fewer customers or clients than you'd normally expect, resulting in reduced activity due to social distancing or government restrictions
  • have one or more contracts that have been cancelled and not replaced
  • carried out less work due to supply chain disruptions

You must not claim if the only impact on your business is increased costs. For example, if you have had to purchase face masks and cleaning supplies. This would not be considered as reduced demand.

Previously trading but you are temporarily unable to do so

This applies to you if you're temporarily unable to carry out your business activities due to coronavirus, because for example:

  • your business has had to close due to government restrictions
  • you've been instructed to shield or self-isolate in-line with NHS guidelines and are unable to work from home (if you've been abroad and have to self-isolate, this does not count)
  • you've tested positive for coronavirus and are unable to work
  • you cannot work due to parental caring responsibilities, for example as a result of school or childcare facility closures

If you had to close before 1 November 2020 and continued to be closed for a period of time up to 29 January 2021, you can still claim as long as you are eligible.

Claims for the third grant have now closed. The last date for making a claim was 29 January 2021.

Examples of reduced demand or unable to trade

These are examples of people who have been impacted by coronavirus between 1 November 2020 and 29 January 2021.

Reduced demand and reasonable belief

A cafe owner has fewer customers due to government restrictions on households mixing, which reduces her takings. She reasonably believes this will significantly reduce her trading profits. She is eligible to claim.

A plasterer cannot get materials due to supply chain issues due to coronavirus. This has reduced the amount of work he can complete and be paid for. He reasonably believes this will significantly reduce his trading profits. He is eligible to claim the third grant.

A part-time personal trainer works in a gym that has closed due to government restrictions. This reduces her business activity on the days that she works. She reasonably believes this will have a significant reduction on her trading profits. She is eligible for third grant.

Reduced demand and no reasonable belief

A cafe owner has fewer customers due to government restrictions on households mixing, which initially reduces her takings. She increases her prices and believes her trading profits will not reduce significantly, so she is not eligible to claim the third grant.

A plasterer cannot get materials due to supply chain issues due to coronavirus. This has reduced the amount of work he can complete and be paid for, but he manages to quickly find a new supplier. He does not believe that the reduced demand will cause a significant reduction in his trading profits. He is not eligible to claim the third grant.

Unable to trade and reasonable belief

A hairdresser has had to shut his shop due to government restrictions. He will not have any income due to the closure and reasonably believes the reduction in his trading profits will be significant. He is eligible to claim the third grant.

A builder has received a letter from the NHS identifying him as clinically extremely vulnerable and it asks him to stay at home. As he is unable to work from home he has a reasonable belief that there will be a significant reduction in his trading profits. He is eligible to claim the third grant.

Unable to trade and no reasonable belief

A hairdresser was unable to work for 2 days as his hair salon closed to be deep-cleaned due to a positive coronavirus case. He does not believe this will significantly reduce his trading profits. He is not eligible to claim the third grant.

A builder has developed coronavirus symptoms and self isolates for 5 days before receiving a negative test result. During those 5 days he was unable to work from home but was able to rearrange his contracts. He does not believe there will be a significant reduction in his trading profits. He is not eligible to claim the third grant.

Other examples

An electrician is still trading but has had increased costs due to buying masks, cleaning supplies and screens. She is not eligible for the third grant because increased costs were the only impact on her business and she has not lost customers.

A dentist returns from a holiday abroad and has to self-isolate for 14 days due to quarantine rules. As this is the only impact on her business, she is not eligible to claim the third grant. This is because reduced demand due to self-isolation after foreign travel is not included in the eligibility criteria.

An accountant reduces his business activity because he wants to partially retire. He reasonably believes this will have a significant reduction on his trading profits. He is not eligible for third grant because the reduced business activity was not caused by coronavirus.

The client of a dog walker cancels a contract due to coronavirus. The dog walker could but chooses not to look for additional work to replace the contract. This means her business activity and her trading profits are reduced because she chooses not to replace the contract and not because of coronavirus. She is not eligible for the third grant.

A IT consultant has other income from renting property. He has made losses on renting due to renovation costs. This is not related to his trading profits from his IT consultancy service. As his consultancy business has not been affected due to coronavirus, he is not eligible for the third grant.


First published 25 November 2020