Sole traders who have not correctly reported their Self Employment Income Support Scheme (SEISS) grants may be forced to repay them in full, it has been warned.
HM Revenue & Customs (HMRC) is writing to self-employed business owners reminding them of their legal obligations.
According to the tax authority, traders who claimed the first, second and/or third SEISS grant but did not include them in their 2019/20 tax return or did not complete a tax return for the relevant year need to take immediate action.
The letter, found here, tells claimants to register for Self Assessment if they haven’t done so already and submit a tax return for the 2019/20 tax year, or amend the submitted tax return.
Action must be taken within 30 days of receiving the letter, or you will be asked to repay the grants in full. If you are submitting a late tax return, you may also be asked to pay a late filing penalty; the deadline for the 2019/20 tax return was 31 January 2021.
Those who did not trade in 2019/20 must also repay any grants in full.
“You should show this letter to your Tax Adviser or Accountant if you have one,” HMRC writes.
“Please take action within 30 days, or we will need you to repay the grants you received. You may be charged a late filing penalty if you are submitting your tax return late (a late filing penalty won’t apply if you’re amending a return you have already submitted).”
For help and advice with related matters, please get in touch with our team today.
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