Many business owners are now asking the question of how to include the SEISS grant on their tax return.
By now many business owners have realised that the Self Employed Income Support Scheme payments (SEISS) are fully taxable and need to be included on their tax returns along with their trading income.
HMRC has made it clear that the payments are treated as taxable income but when do you declare them and how?
The grants are taxable when received (irrespective of your accounting periods) and this may lead to the grants received being taxed in a different period to when your business suffered reduced income due to the pandemic.
- Grants 1-3 taxable in 2020/21
- 4-5 taxable in 2021/22
Use the following link if you need to check what you have received for the SEISS grant.
Please note that accountants do not have access to these figures so you must supply them to your accountant if you have one.
How do I declare SEISS if I am a partner?
If you are a partner in a business and make your own claim you follow the rules above. If the partnership made the claim on your behalf and pooled the money into the business, you have to follow your normal accounting treatment to calculate your share.
Where to include the SEISS grant on your tax return?
There are now separate boxes on your tax return where you should enter the grant figures. You mustn’t put them anywhere else. If HMRC receive a return with no SEISS showing in the correct, box but their computer knows you have received grants, they will automatically correct your return. This would mean you are taxed on the income twice as they will not remove your incorrect entry but add on the amendment. If you are unsure as to how to include the SEISS grant on your tax return please contact us for help.
- On a full self-employment form (SA103(F) it’s box 70.1)
- On a self-employed short form (SA103(S) it’s box 27.1
- On a partnership full form (SA104)F) it’s box 9.1
There is also a new declaration on the tax return ( 20.1 on page 8 ) to declare the grants were correctly claimed.
What if I incorrectly claimed a grant?
There are boxes on the return to report this but the best advice is to notify HMRC and pay it back as soon as possible. Use the following link to pay back a Self-Employment Income Support Scheme grant.
If you need help with your SEISS grant and tax return please get contact us