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Self-Employment Income Support Scheme: where do I include the grants on my tax return?

Updated on 10 June 2021

The Self-Employment Income Support Scheme (SEISS) grants are payments made by the government to eligible businesses which have been adversely affected by the coronavirus pandemic. The grants are subject to income tax and self-employed National Insurance contributions (NIC). There are separate pages on our website explaining the first three SEISS grants, the fourth and fifth SEISS grants and the ‘parental extension’ SEISS rules.

This page explains where the SEISS grants need to be included on your Self-Assessment tax returns, and areas you may need to consider when completing your tax returns, such as if you have multiple trades, claim the trading allowance, are a partner in a partnership or claim tax credits.

Illustration of a man in front of a computer looking at a form

Which tax return should include my SEISS grants?

Which tax return (tax year) you include your SEISS grants in depends on which grant it is and whether you are a self-employed individual or a partner in a partnership. The table below summarises the position:

SEISS grant claimed

Type of business

Tax return to include the grant

Any of the first three SEISS grants

Self-employed

2020/21 self-employment section/ pages. Please note it does not matter what basis period (accounting period) you use – the first three grants must be included on the 2020/21 tax return.

This is explained in detail in our section below: Where do the SEISS grants go on my tax return?.

Any of the first three SEISS grants

Individual partner in partnership

There are two possible scenarios which are detailed in the section below: I am a partner in a partnership – which tax year do I include my SEISS grants in?.

 

4th and 5th SEISS grants

Self-employed

These grants are taxed in the tax year they are received, this should be 2021/22.

4th and 5th SEISS grants

Individual partner in partnership

These grants are taxed in the tax year they are received, this should be 2021/22. However, there are two possible scenarios which are detailed in the section below: I am a partner in a partnership – which tax year do I include my SEISS grants in?.

I am a partner in a partnership – which tax year do I include my SEISS grants in?

If you are a partner who has claimed the SEISS grants because the coronavirus pandemic has adversely affected the partnership’s business then where and how the SEISS grants are treated for tax purposes depends on who actually received the grant.

If you, as a partner, were eligible for the SEISS grant(s) and claimed and received the income into your individual bank account, so it is not recorded as partnership income in the partnership accounts, then the grants will be treated in a similar way to how they are treated if you are a self-employed individual. This means that:

  • The first three grants need to be included on your 2020/21 tax return (regardless of the partnerships accounting period/basis period). The total of the SEISS grants should be included on your partnership supplementary pages, in box 9.1 on either the SA104S short partnership pages or the SA104F full partnership pages. Your SEISS grants should not be included on the partnership tax return (SA800).
  • The 4th and 5th grants are taxed in the tax year they are received, so should be included in the 2021/22 partnership supplementary pages.

There are different rules if you claimed the SEISS grants and exceptionally they were treated as partnership income and included in the partnership accounts and distributed to all the partners in line with the partnership agreement in the normal way. This is illustrated below:

Ella

Ella is a partner in an equal share four-partner trading partnership and was eligible to claim the first three SEISS grants, which totalled £3,600. All the grants were paid directly to the partnership’s bank account. The partnership’s total sales in the year ended 31 March 2021 was £10,000 and it had allowable business expenses of £2,000. Each partner’s share was as follows:

 

£

Profit in year ended 31 March 2021 (£10,000-£2,000)

8,000

SEISS grants

3,600

Distributable profits (£8,000 +£3,600)

11,600

Paid to each partner (25%)

2,900


Therefore, each partner effectively receives £900 of Ella’s SEISS grants (£3,600 x 25%).

In these circumstances, the SEISS grants should not be included on the individual’s partnership supplementary pages (SA104S and SA104F) but instead should be included within the Turnover (sales) boxes 3.24 or 3.29 on the Partnership tax return (SA800).

So, in Ella’s case, the total of £3,600 will be included in box 3.24 together with the sales of £10,000 (as the partnership had turnover less than £85,000), so the total in box 3.24 is £13,600. Ella will need to include her share of partnership profits of £2,900 on her partnership return (SA104S).

She should not include any amounts in box 9.1 on her partnership return as the SEISS grants have already been included as taxable income. Ella may want to explain in the additional information ‘white space’ on her tax return that the partnership has distributed her SEISS grants within the partnership and it is included within her share of the profits from the partnership.

As the SEISS grants are included as partnership income then depending on the partnership’s accounting period the grants may not be taxed following the ‘usual’ rules outlined in the table above. For example, the first three SEISS grants should be taxed in the 2020/21 tax year but if Ella’s partnership has a 31 July year-end then the basis period for the 2020/21 tax year would be the partnership profit for the year ended 31 July 2020 and only the first SEISS grant will be included in this accounting period. This means that the second and third SEISS grants (and potentially the fourth and fifth grants if they are claimed) will be taxed in the 2021/22 tax year as they will be included in the partnership profit for the year ended 31 July 2021.

Where do the SEISS grants go on my tax return?

You may complete your Self Assessment tax return using HMRC online services, paper tax returns or third party software. This section looks at the relevant questions using HMRC online services and the paper tax returns only.

HMRC online tax return

Step one

In the section about your self-employment you will include your Turnover (sales) income and then be asked:

Any other business income (include coronavirus support payments such as Coronavirus Job Retention Scheme, but not Self-Employment Income Support Scheme grants): (optional) DO NOT include your SEISS grant income here. There is a separate question later about SEISS grant income.

Step two

After including details about any business expenses, capital allowances you will move to a page called ‘Other tax adjustments for your business trading name’ and in this section there is a question:

Self-Employment Income Support Scheme grant: (optional) – This is where you need to include the total of your first three SEISS grants unless you:

Step three

In the automatically generated tax calculation, the SEISS grants are included within your ‘Profits from self-employment’ and so will be subject to income tax and Class 4 NIC. The grants will also count as income when looking at the small profits threshold for Class 2 NIC purposes.

Step four

As part of the declaration before you can submit your completed tax return there is an additional question for you to tick.

Coronavirus Support Payments (Optional)

I declare that I have included all coronavirus support payments that I have received (such as Coronavirus Job Retention Scheme and Self-Employment Income Support Scheme) as taxable income when calculating profits in the period of this return.

You do not need to complete this box if your only support payments received were as a result of being furloughed as an employee.

Paper tax returns

If you are self-employed you will complete a main tax return (SA100) and supplementary pages for each of your self-employment trades. If your turnover (sales) is less than the VAT registration threshold (£85,000) then you complete the short self-employment pages (SA103S), otherwise you will need to complete the full self-employment pages (SA103F).

On the main tax return (SA100) you will need to complete box 20.1 which states ‘If any of your businesses received coronavirus support payments (such as CJRS, SEISS) you must put ‘X’ in the box to declare that they have been included as taxable income when calculating profits in the period of this return.

Also you need to include the SEISS grants in box 27.1 Self-Employment Income Support Scheme grant on the short pages and in box 70.1 Self-Employment Income Support Scheme grant on the full pages. Please note there are additional boxes on both returns for other coronavirus business support grants (box 10 on the short pages and box 16 on the full pages), these must not be used for the SEISS grants.

The total of your first three SEISS grants must be included in either box 27.1 (short return) or 70.1 (full return) unless you:

I have claimed the trading allowancedo I need to complete a tax return if I have received a SEISS grant?

Usually if you have no other reason to complete a tax return and your self-employment income (sales/ turnover) is £1,000 or less then you would be entitled to the full relief trading allowance and so would not need to complete an annual tax return. However, if you have claimed a SEISS grant then you must complete a tax return, including the self-employment pages, even if your self-employed income is below the trading allowance (£1,000). The self-employment pages would need to show the sales income and the trading allowance claim as well as the SEISS grants (see Where do the SEISS grants go on my tax return?).

If you claimed any of the first three SEISS grants, then you must include the grant income on your 2020/21 tax return even if there is no income tax or Class 2 or Class 4 NIC to pay.

If your self-employment income is less than the trading allowance, the balance cannot be used against the SEISS grants. This is illustrated below:

Jenny

Jenny is self-employed and was eligible to claim the first three SEISS grants. Her tax information for the 2020/21 tax year is as follows:

Sales

£865

less expenses

£75

Profits

£790

SEISS grants (total of SEISS 1-3)

£2,875

Profit from self-employment (per Jenny’s tax return calculation using HMRC online services)

£3,665


Jenny can elect to use her trading allowance against her actual sales of £865 but she cannot use the remaining £135 (£1,000 -£865) against her SEISS grant income.

If Jenny claims the trading allowance then her profits from self-employment on her tax return will be £2,875, which is the SEISS grant income only.


I have more than one business (multiple trades) – where do I include my SEISS grants?

It may be the case that you have more than one self-employed business (also known as multiple trades) and have claimed the SEISS grants.

If you complete your Self Assessment tax return online then you should complete a different section for each self-employed business (trade). If you complete a paper tax return then you should complete separate self-employment supplementary pages for each trade.

As explained above, the SEISS grants need to be included as a separate entry in the self-employed section, this means if you have multiple trades then you should consider a reasonable way to allocate the SEISS grants between the different trades. This may be straight-forward, for example, if only one of your businesses was affected by the Coronavirus pandemic- in which case all of the SEISS grant income would be included within the self-employed pages of that specific business.

However, it may be the case you claimed the SEISS grants for more than one of your businesses. This is illustrated below:

Sandeep

Sandeep has two self-employed businesses, car washing and selling ice cream. He claimed the first two SEISS grants which comprised of: the first SEISS grant £1,521 and the second grant £1,331. Altogether he received £2,852.

Under the SEISS grant rules, Sandeep must include both grants within his 2020/21 tax return regardless of his basis periods. However, he must allocate the grants between his different trades using a ‘just and reasonable’ basis. Sandeep earns similar profits from both of his trades, so he decides to look at how his two businesses were affected by coronavirus.

He considers that both businesses were similarly adversely affected when he claimed the first grant so he splits the £1,521 equally between the car wash and ice cream trades.

For the second grant Sandeep considers that only his car wash business was significantly affected by the coronavirus pandemic and so he decides to allocate all of the second SEISS grant to this business and none to his ice cream trade.

This means on Sandeep’s tax return he will include SEISS grant income of £2,092 (which is £1,521 x 50% + £1,331) in box 27.1 (self-employment short pages SA103S) for his car washing business and in the self-employment pages for his ice cream business he will include SEISS grant income of £760 (£1,521 x 50%) in box 27.1.

Sandeep should check that the total of the two boxes 27.1 equal the total amount of SEISS grants he received.


However, it may be the case that you have multiple trades which were all affected by the coronavirus pandemic but one of your trades earns more profits than the other trade(s). For example, one of your businesses may make 90% of your total self-employment profits, and your other business earns just 10%. In which case you may decide to allocate 90% of the SEISS grants received to the more profitable business and just 10% to the lower profit-making business.This would also be a ‘just and reasonable’ method of allocating the grants.

It is a good idea to keep a record of how you decide to allocate the SEISS grants when you are completing your tax return.

I have repaid some or all of my SEISS grants – what do I include on my tax return?

You may have partially or fully repaid your SEISS grants either because:

If this is the case, then for the first three SEISS grants, when you complete your 2020/21 Self Assessment tax return you should only include the amount of SEISS grants you were entitled to and/or not voluntarily repaid (so have not paid back or been assessed to pay back to HMRC) in the appropriate SEISS box which is either box 27.1, for the short return SA103S, or box 70.1, in the full return SA103F.

For example

Pete claimed the first three SEISS grants, totalling £3,738, before realising he should not have claimed the third grant. He contacted HMRC and it was agreed that he should repay the third grant which was £1,300.

On Pete’s 2020/21 self-employment short supplementary pages SA103S he should include £2,438 only in box 27.1, which is the full amount of SEISS grants he originally received of £3,738 less the amount he has repaid to HMRC for the incorrectly claimed grant of £1,300.

Pete should not make any entries on page 5 of his main tax return as this relates to incorrectly claimed SEISS grants which HMRC have yet to be informed about (see below).


I know I need to repay some of my SEISS grants but have told HMRC yet – what do I include on my tax return?

 

If you have incorrectly claimed one or more of the first three SEISS grants and you have yet to inform HMRC then you can do so in box 2 on page 5 of your 2020/21 tax return (SA100) in the section: Incorrectly claimed coronavirus support scheme payments. Do not include here any SEISS grants that HMRC already know you should not have claimed.

So, following the example of Pete above:

If instead of informing HMRC about incorrectly claiming the third SEISS grant, Pete only realises his error when completing his 2020/21 tax return, he will need to inform HMRC on the main tax return (SA100). So in box 2 in the section Incorrectly claimed coronavirus support scheme payments Pete will include £1,300 as the amount of the third grant and on the self-employment short supplementary pages he should include £2,438 only in box 27.1.

I claim tax credits – which figures from my tax return do I use for my tax credits claim?

For self-employed individuals (see below for partnerships), our understanding is that HMRC’s intention is for the first three SEISS grants to be taken into account as trading income for 2020/21 for your tax credits claim.

The first three SEISS grants form part of your taxable profits for 2020/21, and, for tax credit purposes, as most self-employed claimants use their taxable profit figure from their tax return when declaring income for tax credit purposes which will include the SEISS grant income, no further adjustments should be necessary in relation to the SEISS grants. This is because the SEISS grants will already be included in your taxable profit figure on your tax return.

On the short self-employment supplementary pages of the paper tax return (SA103S), you will include your SEISS grants in box 27.1 and the figure needed for your tax credits claim (self-employed income) will usually be box 28 plus box 30 (although there are some exceptions for certain groups who use averaging such as farmers).

If you complete the full self-employment supplementary pages (SA103F) you will include your SEISS grants in box 70.1 and the figure needed for your tax credits claim (self-employed income) will usually be in box 73 plus any figure in box 75 (although there are some exceptions for certain groups who use averaging such as farmers).

If you complete an online tax return then you will be prompted to include your SEISS grants when you complete your return (as explained above) and the grants should be automatically included in your taxable profits. For your tax credit claim you should include your taxable profits before any losses from previous years are deducted for tax purposes. This is because the rules for dealing with losses are different in tax credits to tax.

Partnerships

There are different rules depending on how the SEISS grants have been treated in the partnership.

If a partner has claimed SEISS grants and the income has not been included as partnership income then the rules for where the SEISS grants are included on the 2020/21 tax return and the amount used for the tax credit claim are the same as for self-employed individuals (detailed above).

However, if the partnership agreement stipulates that the SEISS income must be treated as partnership income and effectively distributed amongst the partners (see the example of Ella above), whether or not they all claimed the SEISS grants, then the grants are included in turnover (sales). This means that the grants are already included in the share of partnership profits and so for tax credit claims the share of partnership profits (before any losses brought forward) should be used.

In both cases, the figure needed for your tax credits claim (self-employed income) will usually be box 16 plus any figure in box 19 of the partnership supplementary pages (although there are some exceptions for certain groups who use averaging such as farmers).

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