More SEISS doubts

mags21

Grumpy_chap said:

SEISS 3 is a grant ("all-or-nothing") 

If someone felt that they were entitled to the grant but not to the total amount that would be paid out could they make a voluntary repayment to satisfy their conscience?

Jeremy535897

mags21 said:

Grumpy_chap said:

SEISS 3 is a grant ("all-or-nothing") 

If someone felt that they were entitled to the grant but not to the total amount that would be paid out could they make a voluntary repayment to satisfy their conscience?

mags21 said:

Grumpy_chap said:

SEISS 3 is a grant ("all-or-nothing") 

If someone felt that they were entitled to the grant but not to the total amount that would be paid out could they make a voluntary repayment to satisfy their conscience?

You will see reference to voluntary repayments here:
https://www.gov.uk/guidance/tell-hmrc-and-pay-the-self-employment-income-support-scheme-grant-back

A better option might be to make a donation to charity, but if HMRC decide in the fullness of time that the grant was not due, having already returned some of it would reduce the amount to repay.

Grumpy_chap

As I see it, the SEISS 3 is binary yes / no with no middle-ground. 
A partial repayment might just flag investigation and need to fully repay.  The truth is nobody knows.

Jeremy535897

Grumpy_chap said:

As I see it, the SEISS 3 is binary yes / no with no middle-ground. 
A partial repayment might just flag investigation and need to fully repay.  The truth is nobody knows.

All of them are binary, which is why there is this voluntary option to repay some of it, I guess. It seems to me that if HMRC did decide to investigate all such cases, the flow would soon dry up!

justwhat

mags21 said:

Grumpy_chap said:

SEISS 3 is a grant ("all-or-nothing") 

If someone felt that they were entitled to the grant but not to the total amount that would be paid out could they make a voluntary repayment to satisfy their conscience?

Bad move and makes no business sense.  Every single business is going to be paying this back. Sooner or later tax will go up and even if that does not directly effect you costs will go up. 
HMRC never gives money out like this make the most of it.

lisastevo

Just seen this on the ICAEW website -

“HMRC will provide specific boxes in the 2020/21 self assessment tax return for the reporting of SEISS grants. It is possible that the fourth grant will be taxable in 2021/22, that has yet to be decided”

Could this potentially mean that the first 2 grants will be separate from trading profit therefore not included in the “significant reduction”?

Thoughts?

justwhat

lisastevo said:

Just seen this on the ICAEW website -

“HMRC will provide specific boxes in the 2020/21 self assessment tax return for the reporting of SEISS grants. It is possible that the fourth grant will be taxable in 2021/22, that has yet to be decided”

Could this potentially mean that the first 2 grants will be separate from trading profit therefore not included in the “significant reduction”?

Thoughts?

doubt it... the seiss was introduced to help replace income/loss , the property grants were for replacing overheads/costs of bills for property. The money was never meant to be saved or still in the bank lol 

Jeremy535897

The legislation (section 106 and schedule 16 FA 2020) dealing with the taxation of coronavirus support payments (the business property based grants, CJRS and SEISS are all included in this definition) says:
"1(1)This paragraph applies if a person carrying on, or who carried on, a business (whether alone or in partnership) receives a coronavirus support payment that is referable to the business.

(2)So much of the coronavirus support payment as is referable to the business is a receipt of a revenue nature for income tax or corporation tax purposes and is to be brought into account in calculating the profits of that business—

(a)under the applicable provisions of the Income Tax Acts, or

(b)under the applicable provisions of the Corporation Tax Acts."

leopoldo_2

Just to add fuel to the fire, on this thread on the HMRC forum, towards the end the Admin seems to suggest that you only need to count earnings, previous grants do not count: https://community.hmrc.gov.uk/forums/customerforums/sa/8b8b1039-882d-eb11-8441-00155d3ba99e

"When considering your eligibility for the third instalment, any amounts previously received from the first and second instalments would NOT be considered as trading profits."

I'm not sure that this is gospel and someone has asked for confirmation that this is the case but it's worth monitoring. I don't intend to claim if I can help it but it would be good to know.

Jeremy535897

leopoldo_2 said:

Just to add fuel to the fire, on this thread on the HMRC forum, towards the end the Admin seems to suggest that you only need to count earnings, previous grants do not count: https://community.hmrc.gov.uk/forums/customerforums/sa/8b8b1039-882d-eb11-8441-00155d3ba99e

"When considering your eligibility for the third instalment, any amounts previously received from the first and second instalments would NOT be considered as trading profits."

I'm not sure that this is gospel and someone has asked for confirmation that this is the case but it's worth monitoring. I don't intend to claim if I can help it but it would be good to know.

Thank you for posting that. As you rightly point out, it can't be taken as gospel (and look how many times the question was misunderstood by previous HMRC posters). Nevertheless, I would recommend that all claimants of the third grant who find this is an issue make a note of the link, and print the item off, to add to their collection of evidence to support their claim. Let us hope HMRC can be persuaded to confirm this as, according to the letter of the law, I don't think it is correct (schedule 16 FA 2020).