Important SEISS Information Reminder

Please find below information we will need clients to provide when we are collating your accounts and income tax returns in regards to the SEISS grants.

A reminder the SEISS grants are taxable in the year they are received. This means the tax year, not the accounting year or basis period.

The first three SEISS grants will be taxed in 2020/21, and must be reported on the 2020/21 tax return. The fourth and fifth SEISS grants will be taxed in 2021/22 and must be reported on the 2021/22 tax return.  
We therefore need to know the accurate amount of the cash grant received to report on your tax return if you had it paid into your business bank account, we will most probably see the first 2 payments on your bank account but you will need to inform us of the third as this is possibly outside of your accounting year.
As previously advised the SEISS grants are subject to tax as well as class 2 and class 4 NIC, as if they were part of trading profits reported for the tax year. You therefore need to budget for a class 4 NIC labiality of 9% of the SEISS grants, on top of income tax due at 20% or 40% depending on your income tax bands. 

The below information has been taken from HMRC website for your information
With the launch of the fourth SEISS grant, we’re aware that criminals are using this opportunity to try and scam our customers. We’d appreciate if you could signpost your clients to our guidance on identifying scams. The only place that your clients can claim the grant is on GOV‌‌‌‌.UK. 

We are also aware of recent increases in scam phone calls, emails and texts. If someone contacts you claiming to be from HMRC saying that you owe tax and face arrest, are due a tax refund, that your National Insurance number has been compromised or asking you to transfer money or give bank details, it is likely to be a scam.

Search GOV‌‌.UK for our 'scams checklist' and to find out how to report tax scams. You can also access the National Cyber Security Centre’s new guide on how to stay secure online and protect yourself or your business against cybercrime by searching 'Cyber Aware'.

Please do not panic, just be aware of scams at all times.