8 July 2020    |    corona virus, Taxation

SEISS checks by HMRC

If you claimed a covid19 grant, then you can expect that the SEISS checks (Self-Employment Income Support Scheme) will apply to you. Although it was easy to claim and qualify, you need to assume that HMRC will be checking claims next year.
The checks will be anti-fraud measures and checks on eligibility, so what records do you need to back up your claim?

Recording your claim

More information was made available in late June explaining the record keeping expected. There are two elements to the supporting evidence: the claim itself, and how coronavirus affected your business.  The claim will be looked in detail during SEISS checks.

HMRC says you must keep a copy of “all records in line with normal self-employment record keeping requirements.  Including how much you have claimed from SEISS and your claim reference number.

You must keep the records for at least five years after the 31 January tax return deadline or, if later, four years after you send your tax return.

The SEISS grant is part of your taxable business income and needs to appear in your accounts as other income.  Keeping a copy of the SEISS calculation is essential too, but this can be a screenshot of your online claim.

Effects of covid19

The details of your claim are simple enough to record, but the second part of the record-keeping requirements is trickier. You require to keep signficant evidence of how your business was adversely affected by coronavirus.  The guidance originally implied that when you made a claim and you confirmed that your business was “adversely affected” by coronavirus, then that was the end of the matter.  The latest guidance says you must have records which demonstrate the nature of the adverse effects to your business operations. So, what does this mean in practice?

What counts as evidence?

Recommendations from HMRC advise that your evidence for SEISS checks could include:

HMRC guidance on SEISS checks

Tax inspector and SEISS checksHMRC have published detailed guidance on what they will be looking for at a SEISS check on your business.  You should read and know your responsibilities, as we expect significant numbers of claims will be checked in 2021.

We recommend that you note this information now.  That way you are not struggling to remember details of the impact if you get a control visit in 18 months time.

Disclaimer

The information provided is for general information purposes only.

Legislation and details may have changed since this was written.  The text may not include all matters that are relevant to your individual situation.

You should not make decisions, or refrain from making decisions, without taking further professional advice about your specific circumstances.

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