New rules on SEISS criticised for added complexity

A leading self employment body is warning that the rules for claiming the third Self-Employment Income Support Scheme grant are stricter and more complex than before.

The warning from IPSE (the Association of Independent Professionals and the Self-Employed) comes ahead of the opening of the third SEISS grant for applications on Monday.

IPSE says the new rules may create confusion and a “climate of fear” around applying. Where applicants formerly had to prove their business had been “adversely affected” by the pandemic, their business now has to have been affected by “reduced demand” or be “unable to trade” in the qualifying period (November 1st – 31st January).

Claimants must also “decide if the impact on your business will cause a significant reduction in your trading profits for the tax year you report them in”.

Andy Chamberlain, Director of Policy at IPSE (the Association of Independent Professionals and the Self-Employed), said: “We have called for a more focused distribution of SEISS and understand the efforts to target the funds at those most badly affected, but we are concerned these new rules are confusing and risk creating a climate of fear around applying.

“These complex rules may deter many self-employed from claiming support they need – and leave those who do always looking over their shoulder for fear of HMRC demanding the money back.

“If this is the government’s attempt to make SEISS more targeted, it is troubling that it has not taken the opportunity to divert the savings to the one in three freelancers who have still received no support from the scheme.

“We urge the government to look again at the policy solutions that have been presented to it to plug the gaps in SEISS – and not to exclude even more self-employed in need with these new regulations.”

IPSE has joined forces with the Creative Industries Federation, Prospect and the Federation of Small Businesses on a joint letter to the Chancellor which calls for the creation of a Freelance Commissioner to “build more resilience into this workforce and ensure no worker falls through the gaps” and a Future Workforce Commission.

It argues that freelancers have made many UK industries “highly innovative, fast-growing and world-leading” and says that because of gaps in support during the pandemic, “we’re at real risk of losing those people and skills forever”.

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