Self-Employment Income Support Scheme – receiving grants you were not entitled to guidance.
An overclaimed SEISS grant includes any amount of grant which:
- you were not entitled to receive
- was more than the amount HMRC said you were entitled to when you made your claim
This includes where a tax return being amended on or after 3 March 2021 lowers the amount you’re eligible for or causes you to be no longer be eligible.
If your tax return was amended on or after 3rd March 2021
If your tax return has been amended before claiming your fourth grant, you must tell us within 90 days after receiving your grant.
If the tax return has been amended after receiving your fourth grant, you must tell us within 90 days after the amendment.
Where your tax return has been amended on or after the 3 March 2021, you do not need to tell us if you know that the grant amount is lowered by £100 or less.
To find out how you can notify HMRC, go to www.gov.uk and search for ‘Tell HMRC and pay the
Self-Employment Income Support Scheme grant back’.
Failure to Notify
If you fail to notify us about your overclaimed SEISS grant, we will write to you and send you
Recovering overpaid amounts if you fail to notify
To recover the overpaid amount, HMRC can make a tax assessment. They will assess you for the amount that you have been overpaid. If an assessment is made you will be written to. You must pay any amount assessed within 30 days of the assessment. Interest will be charged on any late payments. Late payment penalties may also be added if the amount remains unpaid after the due date.
Penalty for not reporting the Income Tax charge
You may be charged a penalty if you do not tell HMRC within the 90 day notification period that you’re chargeable to Income Tax on an overclaimed SEISS grant.
When deciding the amount of any penalty, HMRC will take account of whether you knew you were entitled to some or all of the SEISS grant:
- when you received it
- when it became repayable or chargeable to tax because your circumstances changed
- if you amended your tax returns on or after the 3 March 2021, for the fourth grant
If you knew you were not entitled to your grant and did not report within the 90 day notification period, the law treats your failure as ‘deliberate and concealed’. This means we may charge a penalty of up to 100% on the amount of the SEISS grant that you were not entitled to receive or keep.
If you did not know you were not entitled to your grant when you received it, you will only charged a penalty for failing to report if you have not repaid the first, second or third grants by 31 January 2022 and the fourth grant by 31 January 2023.
If an assessment is issued to recover a grant which you were not entitled to or were overpaid, or if you are charged a penalty, HMRC will write and explain how HMRC arrived at the decision and the amount of the tax or penalty due.
If you do not agree with the decision or the amount due, you may appeal within 30 days from the date the notification was issued to you.
Reporting grants in Self Assessment tax returns
If you have repaid the grant or HMRC have made an assessment by the date you submit your tax return, you do not need to include it in your Self Assessment tax return.
If HMRC have not made an assessment or you have not repaid the grant by the date you submit your tax return, you need to include it in your Self Assessment tax return.