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Directors & SEISS Grants

Directors claiming SEISS

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I've had 2 cases recently where one man company directors have been able to claim SEISS Grants. Does anyone know how this is possible? They have no other income apart from dividends and a small monthly salary.

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By doubletrouble
22nd Jul 2021 05:38

If they were previously self employed then they may show as ‘eligible’ for the grant, does not mean they have too apply for it.

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By SXGuy
22nd Jul 2021 07:05

Perhaps they were self employed at some point between 2018 and 2020? Sounds most likely. That or the tax return may have incorrectly shown income in the SE pages over those years.

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By K81
22nd Jul 2021 08:31

I have one director who claimed this as HMRC told her she was eligible, her self-employment ceased in Feb 2019 when her directorship started. I have told her she needs to pay this back.

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Replying to K81:
RLI
By lionofludesch
22nd Jul 2021 18:23

K81 wrote:

I have one director who claimed this as HMRC told her she was eligible, her self-employment ceased in Feb 2019 when her directorship started. I have told her she needs to pay this back.

If HMRC told her she was eligible, I would resist any penalty.

You should be able to rely on HMRC's advice.*

* Obviously, I accept that you can't.

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Replying to lionofludesch:
By K81
23rd Jul 2021 08:28

she hasn't told me that a penalty has been charged, hopefully she repaid it almost straight away back in May 2020, not had her records in yet to check paperwork, but I will bear this in mind, thank you.

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Replying to lionofludesch:
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By Imran Sajjad
26th Jul 2021 11:27

Well one of the condition is that taxpayer will carry on the self-employment. Therefore, I would also ask client to return the grant.

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Replying to Imran Sajjad:
RLI
By lionofludesch
26th Jul 2021 11:34

Imran Sajjad wrote:

Well one of the condition is that taxpayer will carry on the self-employment. Therefore, I would also ask client to return the grant.

Of course.

But I'd resist the penalty. I'm not sure what point you're making.

I can't condone HMRC fishing for extra revenue by giving taxpayers incorrect information. And neither should HMRC.

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Replying to lionofludesch:
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By Imran Sajjad
26th Jul 2021 11:51

Absolutley you don't have to pay any penalty at all due to a mistake by HMRC and if any penalty is issued this can be challenged very easily.

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Replying to Imran Sajjad:
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By AdamMurphy
26th Jul 2021 14:21

It’s no mistake by HMRC, these chancers knew they weren’t self employed anymore and deliberately claimed

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Replying to AdamMurphy:
RLI
By lionofludesch
26th Jul 2021 14:37

AdamMurphy wrote:

It’s no mistake by HMRC, these chancers knew they weren’t self employed anymore and deliberately claimed

We don't know what was said.

I for one don't assume - or even expect - that individual taxpayers know what questions they should be asking.

I do, however, expect HMRC to know what they should be asking.

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By ccassociates
22nd Jul 2021 09:43

I have one who incorporated on 1 Jan 2019 so his sole trade cessation accounts went on his 2019 return. HMRC sent him the link, he claimed against my advice. He had to repay it when his 2020 return was filed, he was also fined

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Replying to ccassociates:
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By Mr_awol
22nd Jul 2021 09:59

Good (on the basis you told him the position so he knew full well, i have no sympathy).

Out of curiosity, was it a 100% penalty, and did they also charge interest? I don't think I've got any offenders myself (certainly not as bad as this) but I might am trying to get a gut feel for the stance they are taking.

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Replying to Mr_awol:
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By OurPlace
22nd Jul 2021 10:15

I have two exactly the same and HMRC have advised that provided it is paid back in full by 31 Jan there will be no penalties. It has been repaid so it will be interesting to see if they now charge a penalty.

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Replying to ccassociates:
RLI
By lionofludesch
22nd Jul 2021 18:24

ccassociates wrote:

I have one who incorporated on 1 Jan 2019 so his sole trade cessation accounts went on his 2019 return. HMRC sent him the link, he claimed against my advice. He had to repay it when his 2020 return was filed, he was also fined

He received SEISS in 2019/20 ?

How ?

Just curious.

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By Hugo Fair
22nd Jul 2021 11:01

It's possible because the same greedy people who decide to incorporate so as to "save tax" (without understanding any of the implications) ... appear unable to understand that grants (SEISS) are not the same thing as loans (BBLS) - "they're both free hand-outs from the govt aren't they?"
This goes hand-in-glove with the attitude that you simply say whatever's required to get the money ... it's not even thought of as lying, but just telling 'them' what they want to hear!

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By sanjay100
22nd Jul 2021 16:21

Do they have bounceback loans too. I have heard cases where sole traders mainly builders has incorporated and still has a sole trader business bank account - obtains one BBL under sole trader and another BBL under Limited company. Who will know and who will care.

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