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Taxation of Covid grants - default to taxable?

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I have a client who has a FHL that qualified for, and received, a local authority grant of £10,000 in 2020/21. I can't think why it shouldn't be taxable, just like the SEISS grants. Anyone disagree?

Also, where does it go on the tax return? Other income?

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By Cazzie B
16th Jul 2021 12:15

I included it in box 5

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Psycho
By Wilson Philips
16th Jul 2021 12:19

The question is simple - why did he need to apply for the grant?

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Replying to Wilson Philips:
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By mbee1
16th Jul 2021 13:20

Wilson Philips wrote:

The question is simple - why did he need to apply for the grant?


If it was a FHL he didn't need to apply. Sounds like he was registered for business rates so it would have been sent automatically.
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Replying to mbee1:
Psycho
By Wilson Philips
16th Jul 2021 13:32

Let me rephrase then. Why did he need the cash, and if he didn’t need it is he going to hand it back? (The second part is rhetorical.)

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Replying to Wilson Philips:
Red Leader
By Red Leader
16th Jul 2021 13:38

Sorry, but where is this leading? Do I need to do more research on the obligation to repay rates grants?

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Replying to Red Leader:
Psycho
By Wilson Philips
16th Jul 2021 14:07

Only if you want to. The point that I was failing to make was that if you consider why your client may have wanted or needed the grant that might lead you to the answer as to whether or not it is taxable.

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Replying to Wilson Philips:
Red Leader
By Red Leader
16th Jul 2021 14:36

Okay.

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Replying to Wilson Philips:
RLI
By lionofludesch
16th Jul 2021 19:06

Wilson Philips wrote:

Let me rephrase then. Why did he need the cash, and if he didn’t need it is he going to hand it back? (The second part is rhetorical.)

He doesn't have to hand it back. It wasn't conditional on being affected by covid.

You're in a blind ginnel here.

It's taxable. Stick it in the other income box.

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Replying to lionofludesch:
Psycho
By Wilson Philips
17th Jul 2021 08:55

Did you miss the bit in brackets?

Although, if such grants were handed out willy-nilly, unsolicited, with no thought as to their need, all the more reason to hand back money that isn’t needed so that it can be re-distributed to more deserving causes.

But we’ve long learned to forget about taxpayers having morals.

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Replying to Wilson Philips:
Red Leader
By Red Leader
17th Jul 2021 11:42

Puts me in mind of Stanley Baldwin ...

After WW1, he felt that he should contribute more to help the national debt. He was much better off than many, especially of course those who didn't make it. He was a rich man, though not up there with Croesus. To lead by example, he calculated his total wealth and donated 20% of it, in cash rather than specie. Very few followed his example. Years later his manufacturing business became much less profitable and the 20% in cash he had given away would have formed a far higher percentage.

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By Tom Cross
16th Jul 2021 16:15

This https://www.gov.uk/government/publications/self-assessment-uk-property-s... might answer your enquiry more succinctly. The extract refers to;-

Coronavirus support scheme payments
You must include amounts of taxable coronavirus support scheme payments that you received, subject to further guidance in these notes. These include the following:
• Coronavirus Job Retention Scheme (CJRS) • any other applicable HMRC coronavirus support scheme • payments that you were entitled to receive from local authorities or devolved administrations
For more information about coronavirus support schemes, go to www.gov.uk/coronavirus/business-support

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By Ardeninian
16th Jul 2021 16:34

The notes to SA105 are your friend here: https://assets.publishing.service.gov.uk/government/uploads/system/uploa...

Box 5 Income
Put the total amount of income from all your FHL (including income from services you provide to tenants) in box 5.

Coronavirus support scheme payments are taxable and include payments from the Coronavirus Job Retention Scheme (CJRS), any other applicable HMRC coronavirus support scheme and payments you were entitled to receive from local authorities or devolved administrators.

If you received coronavirus support scheme payments, include in box 5 the amount you received.

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Red Leader
By Red Leader
17th Jul 2021 10:44

OP here. Thank you all. I'm putting it in box 5 of the property pages.

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