SEISS: When and how to notify tax return amendmentsby
In April Emma Rawson explained that amending tax returns may mean repaying SEISS grants. HMRC has now provided more details on which amendments need to be reported and how to do this.
For the fourth SEISS grant (SEISS 4) HMRC worked out both eligibility and the amount of grant based on submitted tax returns, and any amendments made to those returns, which were received by 2 March 2021.
If an amendment is made on or after 3 March 2021 to tax returns for any of tax years 2016/17 to 2019/20, the taxpayer must consider whether that amendment has an impact on the amount of the SEISS 4 grant they should have received:
- If, once the amendment is taken into account, the taxpayer would no longer be eligible for the grant, they will need to pay it back in full.
- If the amendment means the taxpayer would have received a lower grant, the taxpayer will need to repay the excess.
In both cases, the taxpayer needs to notify HMRC to make arrangements for payment.
Unfortunately, this treatment of amendments is very much a one-way street – whilst taxpayers need to tell HMRC if an amendment would mean the taxpayer should receive no, or a lower, grant, there is no scope to claim a higher SEISS grant as a result of an amendment submitted on or after 3 March 2021.
What is an amendment?
For the purposes of the SEISS 4 Direction, an ‘amendment to a tax return’ has a fairly wide definition. HMRC says that anything which has the effect of modifying a person’s tax return is a relevant amendment for SEISS purposes.
This means that a requirement to notify and repay can arise where the taxpayer or HMRC amends the tax return. HMRC amendments include those made following a tax enquiry, or corrections of returns made under s9ZB TMA 1970.
By contrast, HMRC have confirmed that where a person’s tax position is instead amended via contract settlements, revenue assessment, raising a charge etc. (such that their tax return is not modified) there won’t be an impact on their SEISS grant.
Which amendments need to be notified to HMRC?
Only SEISS 4 and SEISS 5 grants are affected. There is no requirement to pay back any amounts of grant received under earlier rounds of SEISS, where the rules any tax return amendment made after 26 March 2020 is effectively ignored.
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Emma a technical officer with the Association of Tax Technicians (ATT). Her background is in corporation tax and she also has a focus on VAT.
She trained with Deloitte, working in both their London and Leeds offices, and also spent a short time working in a specialist consultancy firm providing advice to other practitioners before joining...