Thursday, 23 July 2020 08:59

Warning - Self Employment Income Support Scheme, what you need to know (and do) right now Featured

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HMRC issues warning on SEISS claims 

Make a mistake or a deliberately false claim for the Self-Employment Income Support Scheme (SEISS), and you could end up having to pay back the cash or even be prosecuted.

The grant under the SEISS has been a lifeline for many self-employed workers, but it’s not without strings attached and you need to be able to prove your business was adversely affected by the pandemic by keeping clear financial records.

There are two main elements you’ll need to demonstrate:

  1. The actual SEISS claim
  2. How Covid-19 has affected your business

According to HMRC, self-employed workers must keep a copy “of all records in line with normal self-employment record keeping requirements” plus details on how much has been claimed from the SEISS. These records must be kept for at least four years after submitting your tax return: five years in total. We advise that you keep a copy of your claims, which can be a screen grab. 

That’s the simple bit.

The latest guidance states you must also keep records to show how your business was adversely affected by COVID-19. These should also be retained for five years. The evidence could include a reduction of turnover (clearly important), any loans received because of COVID-19, dates of causes of the failure to work because you and/or your staff had the virus, and shielding or caring responsibilities. 

To safeguard your position further, we advise keeping a record of what you expected to happen. For example, if you were expecting cancellations, postponement of work, or a reduction of work from regular clients. The more detail you have the better, should you receive a challenge from HMRC.

It may be time-consuming to collect and record all the information you need but it’s worth doing now so you’re prepared. A bit like insurance – it’s not much fun paying the premium but you’ll be glad you did if a problem occurs!

The warning might make you more wary of claiming the third SEISS grant but as long as you can prove your business has been negatively impacted by COVID-19, it could be a welcome injection of much-needed cash. Applications open for the third grant on 20th November, offering 80% of 3 months average monthly trading profits, paid out in a single instalment and capped at £7,500 in total. The Government has already announced that there will be a fourth grant covering February 2021 to April 2021. The Government will set out further details, including the level, of the fourth grant in due course. Read more in our previous blog on SEISS. click here to access the previous blog

Whether you’ve already claimed or intend to apply for the SEISS from November, clear record keeping is crucial. Talk to us if you have any concerns or are considering applying for SEISS – we can help make sure you are getting the financial help you need and assist with organising your records to back your claim. Just drop us a line at This email address is being protected from spambots. You need JavaScript enabled to view it.


Read 5736 times Last modified on Thursday, 17 December 2020 10:49

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