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SEISS part claim for just January?

Can you claim for just one month

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A clients business as a chiropodist claimed for the first two siess grants.  By the third her business was back to normal and she has claimed.  Today with the rise of worry about covid elderly patients have been cancelling and her business is now suffering.  Can she just claim for January not November and December.  Asked hmrc about the fourth claims and the answer was we have no information at the moment which is not helpful.  How will hmrc see her claim for November, December and January in the above circumstances.

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By chancewind
04th Jan 2021 14:13

chancewind wrote:

A clients business as a chiropodist claimed for the first two siess grants.  By the third her business was back to normal and she has claimed.  Today with the rise of worry about covid elderly patients have been cancelling and her business is now suffering.  Can she just claim for January not November and December.  Asked hmrc about the fourth claims and the answer was we have no information at the moment which is not helpful.  How will hmrc see her claim for November, December and January in the above circumstances.

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By chancewind
04th Jan 2021 14:14

sorry just read the question. She has NOT claimed for November to January yet

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By Paul Crowley
04th Jan 2021 14:28

Claim or no claim
Client decides based on the rules

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By jonharris999
04th Jan 2021 15:00

She is 100% eligible for the third round and should claim.

You would not pay 20% tax for the first six months of the year if you earned £20000 profit in that window, and 40% for the second six if you earned £25000 in that one.

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RLI
By lionofludesch
04th Jan 2021 16:05

No numbers given but, if she has to close, I would imagine that her income will be significantly down.

She'll know more at 8 pm - maybe a little later as Boris has a tendency to waffle. She'll have to judge for herself but a claim would definitely be on the cards for mine.

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By fawltybasil2575
04th Jan 2021 17:08

@ chancewind (OP).

The SEISS 3 claim relates to the period 1 November 2020 to 29 January 2021, and the claim must be made on or before 29 January 2021.

However, the SEISS 3 rules differ from the SEISS 1 and SEISS 2 rules inasmuch as:-

(i) There must have been a reduction in gross income in the relevant period (see below) due to Coronavirus (hence increased expenditure is not a factor), ie a reduction in gross income in comparison with what the gross income would have been if the business had not been adversely affected by the virus,

(ii) The reduction in gross income, for the relevant period, must have been “significant” (albeit sadly such nebulous concept of significance is not defined) in relation to the profit expected to be achieved in the accounting period(s) in which the relevant period falls.

The “relevant period” is, taking a strict interpretation of the legislation, IMHO the period from 1 November 2020 up to the date on which the claim is submitted [albeit others have interpreted the legislation alternatively to mean (as indeed was my initial interpretation) that the relevant period is from 1 November 2020 to 29 January 2021: such alternative interpretation of course requires one to not only determine the estimated reduction in gross income up to the date of the claim, but also the estimated reduction in gross income for the remainder of the quarter to 29 January 2021].

Here are links to the legislation (by way of the three Treasury Orders issued under the Coronavirus Act 2020 (for SEISS 1, SEISS 2, and SEISS 3).

https://www.gov.uk/government/publications/treasury-direction-made-by-th...

If you accept my interpretation of the legislation, as above, then (given that your question at least implies that there was no loss of income from 1 November 2020 to 31 December 2020) it would be extremely unlikely that, as at today’s date, the reduction in gross income from 1 January 2021 to 4 January 2021 will have been “significant”: hence, I would recommend postponing submitting the claim until deeper into January 2021, ie at the point at which the reduction in gross income from 1 January to the date of claim has become “significant”). If a full "lockdown" arises soon, requiring the client to close the surgery, then the SEISS 3 claim can of course be made "sooner rather than later".

I appreciate that the client (and/or you on their behalf) may consider that the client should only be entitled to a SEISS 3 claim for the one month (not the full nearly 3 months). The legislation does not follow that logic, although of course the client may voluntarily repay 2/3rds of the SEISS 3 grant to HMRC if they wish. One should of course note, in considering whether to make such voluntary payment, that the SEISS 3 grant is based upon profits of an earlier year: and that it is only at the 80% rate (and that similar restrictions have applied to SEISS 1 and SEISS 2 grant monies received).

One should also of course consider that if the business is affected by “lockdown/tier 4" etc. beyond 29 January 2021, one does not know what SEISS grants will be available from 30 January 2021 onwards (we are thus far advised that a grant for the next quarter will be available, although not the quantum thereof: whether the vaccines will work the magic oracle thereafter is not yet known).

Basil.

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Replying to fawltybasil2575:
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By jonharris999
04th Jan 2021 17:27

I disagree with one aspect of Basil's reply.

The Directions make clear that what matters is the client's "reasonable belief" about whether there will be a significant reduction or not across the whole period. I suggest that the OP has already given us enough info, taken together with our observations about the quite obvious prevailing situation, to support the notion that such a belief would, if an application were made today, be reasonable. The Directions provide for no other criteria.

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RLI
By lionofludesch
04th Jan 2021 17:57

My advice today would be "ask us tomorrow".

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By fawltybasil2575
04th Jan 2021 19:03

@ jonharris999 (your 17.27 post).

You have of course honed in on the very point, made in my earlier post, re my having changed my mind re the legislation. Paragraph 4.2(b) of the Schedule states:-

"claimant reasonably believes will suffer a significant reduction in trading profits for a relevant basis period".

Forgive me if this is NOT the part of the Treasury Order to which you were considering when referring to "a significant reduction or not across the whole period" (which I assume you consider to be the SEISS 3 period).

The "period" at issue is not the SEISS 3 period but the "relevant basis period", which is defined in 4.5 (with a reference to Chapter 15 of Part 2 of ITTOIA 2005).

If one considers therefore therefore 4.2(a) and 4.2(b) together, and note the past tense (has") in the former, IMHO this supports my view. As ever, however, your own further views would be welcomed.

Basil.

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Replying to fawltybasil2575:
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By jonharris999
04th Jan 2021 19:22

Fair point Basil.

It seems to me that 4.2 b) follows from 4.2 a) unless the claimant has some other reason which allows it not to. Note that the examples which HMRC give in their guidance on SEISS 3 all involve such another reason: eg, one claimant raises her prices, another was intending to reduce the amount of work they took on in any event, etc. If there is no such superseding reason, it seems to me that one's reasonable belief at b) can simply follow a).

At risk of repetition of my view stated in other threads, I am very concerned that the poor and narrow drafting of this legislation is leading those who would have legitimate claims not to claim for a quite unfounded fear that their reasonable beliefs will be challenged when found in retrospect to be inaccurate. In my view we should loudly be making the point that reasonableness of belief, and accuracy in retrospect, are two entirely different things (a lesson which my ex-wife would no doubt say I learned too late).

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