SEISS 4 money earned between April 6th & 30th

mljg

Hi,

I have a question about the SEISS 4 Grant. 

Since the qualifying period is February to April and the reduction of profit is to be calculated in the context of the whole tax year (20/21) how do I account for any money earned between April 6-30 2021 which is in the qualifying period but not in the relevant tax year?

Thanks. 

bigmickyy

It didn’t cover you for those months. I assume because funds have been received in the new year that you will account for them in next years return.

Jeremy535897

mljg said:

Hi,

I have a question about the SEISS 4 Grant. 

Since the qualifying period is February to April and the reduction of profit is to be calculated in the context of the whole tax year (20/21) how do I account for any money earned between April 6-30 2021 which is in the qualifying period but not in the relevant tax year?

Thanks. 

You only have to demonstrate a significant reduction in one basis period's trading profits, so either the year to 5 April 2021 or the year to 5 April 2022, if your accounts are made up to 5 April. 

Pennywise

The SEISS grants are taxed in the tax year of receipt, regardless of the period they cover.

mljg

Jeremy535897 said:

mljg said:

Hi,

I have a question about the SEISS 4 Grant. 

Since the qualifying period is February to April and the reduction of profit is to be calculated in the context of the whole tax year (20/21) how do I account for any money earned between April 6-30 2021 which is in the qualifying period but not in the relevant tax year?

Thanks. 

You only have to demonstrate a significant reduction in one basis period's trading profits, so either the year to 5 April 2021 or the year to 5 April 2022, if your accounts are made up to 5 April. 

So what I earned from April 6th-30th 2021 has no bearing at all on calculating whether I had a significant reduction of profit in the period Feb 1st-April 30th??

Jeremy535897

Pennywise said:

The SEISS grants are taxed in the tax year of receipt, regardless of the period they cover.

That is what the Finance Bill says, but that wasn't the question. The issue is that you look at the period 1 February 2021 to 30 April 2021:

"Before you make a claim, you must decide if the impact on your business between 1 February 2021 and 30 April 2021 will cause a significant reduction in your trading profits for the tax year you report them in."

From https://www.gov.uk/guidance/claim-a-grant-through-the-coronavirus-covid-19-self-employment-income-support-scheme

If you make up your accounts to 31 March or 5 April, say, the period 1 February 2021 to 30 April 2021 falls partly into 2020/21, and partly into 2021/22. HMRC have clarified that you only need to look at one year (whichever suits you) in these circumstances (although at this stage, working out whether the downturn in results in April 2021 will mean trading profits in 2021/22 will be significantly reduced, would seem to be rather difficult).

Jeremy535897

bluenun said:

Sorry to hijack this thread but it my help the OP too.

"If you make up your accounts to 31 March or 5 April, say, the period 1 February 2021 to 30 April 2021 falls partly into 2020/21, and partly into 2021/22. HMRC have clarified that you only need to look at one year (whichever suits you) in these circumstances".

Whichever of the 2 tax years you choose does the 4th grant need to be declared on the 2021/2022 tax return?
So if you choose to claim the grant based on a reduction of 2020/2021 trading profits, is the 4th grant still declared on the 2021/2022 tax return?

All SEISS grants are taxable when received (subject to Finance Bill approval), so SEISS 1,2 and 3  are taxable in 2020/21. and SEISS 4 and 5 will be taxable in 2021/22. Which year you use to establish a significant reduction in trading profits is irrelevant.