Are you wondering how to show your SEISS Grant on your tax return? Then you’re in the right place! If you received the SEISS grant as part of the Covid crisis, then you’ll need to make sure you show it correctly on your tax return. In this guide, you’ll find out exactly how to include it on your return and what you need to show in business turnover.
Table of contents
Friendly Disclaimer: Whilst I am an accountant, I’m not your accountant. The information in this article is legally correct but it is for guidance and information purposes only. Everyone’s situation is different and unique so you’ll need to use your own best judgement when applying the advice that I give to your situation. If you are unsure or have a question be sure to contact a qualified professional because mistakes can result in penalties.
1. Where to Show Your SEISS Grant On Your Tax Return
Your SEISS grant needs to be shown under ‘other tax adjustments’ when you fill in your tax return. There is a separate box for the self-employment income support scheme grant’ in the self-employment section of your SA100 tax return. You’ll find it after you’ve entered details about your business, self-employment income and expenses.
2. Is SEISS Included in Business Income?
Any SEISS grant should be shown separately from your business income – there is a reminder on the tax return when you enter your business turnover.
3. Is the SEISS Grant Taxable?
SEISS was set up by the Chancellor to try and compensate self-employed workers who have lost income as a result of isolation and lockdown measures, similar to the furlough scheme introduced for workers employed on payroll. This means any SEISS payments are taxable since they are designed to ‘replace’ lost income.
If you have made a loss and are owed a tax repayment, even though you received the SEISS grant, then HMRC may send you a SURF 1 letter to verify certain information and confirm the validity of your tax repayment. This is currently happening more and more due to an increase in claims for tax repayment due to the impact of the Coronavirus and the investible increase in fraud.
- How to Fill In Your Tax Return Online
- What Can Trigger a Tax Inspection from HMRC?
- SURF 1 and SURF 2 Tax Letters from HMRC
- How to Claim Self Employed Expenses
Taxes are changing! From April 2024 sole traders will need to report their earnings and pay tax on a quarterly basis. This is known as Making Tax Digital, which you can read more about in this guide to help you get prepared.