SEISS wave 2 - should I claim?

TheDude86

Hi everyone, 
I work in the performing arts/entertainment sector and registered self employed. I received the first grant and not sure about claiming the second. Here's why..

Since the previous grant I have taken up temporary courier work as a self employed van driver under the same sole trader business name.

My income is more or less back to normal, for now. However, several venues that I work with at the performing job have either closed or are on the verge of closure and this whole situation is no doubt likely to adversely effect my professional career moving forward.

As the government states, this is to be the last wave of SEISS payments and I don't intend to stay working as a courier/would like to start cutting my weekly shifts down soon.

Although I can claim and receive the money, am I breaking the rules by doing so? The last thing I want is to have an audit later down the road, be penalised and be accused of getting this wrong.

Advice appreciated 



 

Grumpy_chap

The criteria for the second SEISS grant are the same as the first, namely that the business must be adversely affected by coronavirus after 14th July (different date to 1st grant) and the business is trading and intends to continue trading. 

Your sole-trader business is in the entertainment sector and, from what you write, is adversely affected by coronavirus at the moment, which is after the qualifying date.  You state that you intend to resume trading in that business.  The only reason the business is not currently trading is because of coronavirus.

Based on the above, it looks as though you qualify for the second SEISS grant.

The work in a different business (van driving) is entirely unrelated and, you state, temporary alternative but it remains your intent to return to the entertainment business as soon as possible.

I would interpret the above as having no impact on your eligibility for the second SEISS grant.  It is difficult as the criteria include an element of "intend to continue / resume trading" and intent is difficult to prove.  If you had written that the van work was so lucrative you could not imagine returning to entertainment, then the intent to resume trading would no longer be there.

I understand your concern about an audit.  What I suggest is that you write down the rationale for your decision that you are eligible to claim and how you feel you meet the criteria.  Sign and date this record and share in a recorded form (e.g. e-mail) with an external person, maybe your Accountant.  That action would seem to cover your position should there be a future audit or should things subsequently change so that you never return to entertainment business.

My final thought is that, judging by some van drivers on the road, it is possible to combine driving a van and entertainment at the same time.  If you have entered the "horror" genre, then it may well be that the entertainment business has not been adversely affected.

TheDude86

I did enjoy your final thought. You might not be too far from the truth in that respect 🙂

Back on topic - my main concern is that my income for the specific time period outlined for seiss wave 2 is more or less the same as was previously.

If i'm to look at the scheme as financial compensation for my career being sidelined with possible future implications, then I can see the argument for claiming this money.

If this scheme is only there for the sake of replacing overall lost income for that period only, the argument is against?

Further advice appreciated. 

adamp87

Isn’t this more of a moral question than anything else? End of the day entertainment most likely for most avenues is goosed till 2021 at the earliest.

Take the grant.

Grumpy_chap

There are several examples of business being "adversely affected" on the gov website.  Some of the examples themselves seem rather tenuous but would give weight to the idea that simply loss of income is not the only criteria.  Indeed, there are reasons why that would be perverse as if a claim was validly made but the sole-trader is still allowed to work (as per the rules), there would be no benefit to anyone if that sole-trader then turned work away so as to ensure reduction of income and maintain eligibility for the grant.

Jeremy535897

Grumpy_chap said:

There are several examples of business being "adversely affected" on the gov website.  Some of the examples themselves seem rather tenuous but would give weight to the idea that simply loss of income is not the only criteria.  Indeed, there are reasons why that would be perverse as if a claim was validly made but the sole-trader is still allowed to work (as per the rules), there would be no benefit to anyone if that sole-trader then turned work away so as to ensure reduction of income and maintain eligibility for the grant.

Yes, but the worked examples of the builder clearly include a financial loss as well as other factors. The stupid thing is that if you were employed as a courier rather than self employed, earning exactly what you are currently earning, there would be absolutely no question that your business was adversely affected by coronavirus. So there is the real answer. A sole trader can have more than one business. Indeed, you will have to declare your profits as a courier as a separate trade, so it will be quite obvious that your trade as an entertainer has been adversely affected.

TheDude86

Jeremy535897 said:

Grumpy_chap said:

There are several examples of business being "adversely affected" on the gov website.  Some of the examples themselves seem rather tenuous but would give weight to the idea that simply loss of income is not the only criteria.  Indeed, there are reasons why that would be perverse as if a claim was validly made but the sole-trader is still allowed to work (as per the rules), there would be no benefit to anyone if that sole-trader then turned work away so as to ensure reduction of income and maintain eligibility for the grant.

Yes, but the worked examples of the builder clearly include a financial loss as well as other factors. The stupid thing is that if you were employed as a courier rather than self employed, earning exactly what you are currently earning, there would be absolutely no question that your business was adversely affected by coronavirus. So there is the real answer. A sole trader can have more than one business. Indeed, you will have to declare your profits as a courier as a separate trade, so it will be quite obvious that your trade as an entertainer has been adversely affected.

Hi Jeremy, how would you suggest that i go about this? I am indeed working for an amazon DSP in the gig economy so it all goes through on the same tax return/utr as self employed earnings. I'm not quite sure what you mean by declaring courier profits as a second trade or if this is even possible.

Please point me in the right direction if so. 

Jeremy535897

You complete a separate form SA103 for each trade. You cannot lump together the profits of two different trades. See https://www.gov.uk/government/publications/more-than-one-business-hs220-self-assessment-helpsheet/hs220-more-than-one-trade-profession-or-vocation-2020

Some detailed advice here: https://www.litrg.org.uk/tax-guides/self-employment/working-out-profits-losses-and-capital-allowance/how-do-i-work-out-my