The sins of SEISS grants


The Self Employment Income Support Scheme was available to anyone who was self employed and adversely affected by the pandemic. I’m sorry to be a party pooper but if you claimed it there are some things you should know.

Not telling the accountant

HMRC prevented accountants making applications for grants on behalf of clients and some people didn’t make a claim. This means we might not know if you made the claim so you have to keep records and let us know or your tax return may be wrong.

Leaving it off the tax return

It is a myth that SEISS grants are not taxable. They are and need to be declared on your tax return. There were three grants before 6th April 2021 so they all have to be entered on your 20/21 return.

Your tax could be wrong

If, for some reason, HMRC records didn’t match what you put on your return they will send you an amended calculation. If this happens be sure to check as it is possible your tax identity had been misused.

Ignored for benefits

If you claim benefits you will need to include SEISS grants on any declaration of income.

Claimed as employee

If you had self employed income on your 2018/19 return it would have been possible to make a claim for SEISS. However, if the business was incorporated in 2019/20 or 2020/21 they may not have known the sole trader ceased and permitted the claim. To qualify for SEISS the self employed income had to be more than half of your total so you may be asked to repay.

Payments on account

The possible claims before April 21 were higher as the cap was £21,570 in 2020/21 and £15,000 in the year after. It may be necessary, therefore to reduce your 2021/22 payments on account. Check with your accountant if in doubt.

Repaid to wrong account

Taxpayers can make voluntary repayments of grants but it has to be made to the specific HMRC account set up for the purpose. If you do repay anything be sure to keep a careful record of exactly what and when.

Include in turnover

It is wrong to include SEISS grants in the business turnover and there is a special box on the tax return. You may want to do it to boost income when applying for a loan but this is wrong.

If you have any questions regarding SEISS grants, our team here at BBS are on hand to help.

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