Reporting Covid grants received to HMRC

Date

Posted by

Reporting Covid grants received to HMRC
Suzanne Hollander

Share the article

Share on facebook
Share on twitter
Share on linkedin

Posted by

Reporting Covid grants received to HMRC
Suzanne Hollander

Share the article

Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn

Reporting Covid grants received to HMRC

Most COVID support grants are treated as taxable income in the same way as other taxable receipts and need to be reported to HMRC. The grants are treated as income where the business is within the scope of either Income Tax or Corporation Tax.

This treatment extends to support measures including the following:

  • the Self Employment Income Support Scheme (SEISS)
  • test and trace or self-isolation payments
  • the Coronavirus Job Retention Scheme (CJRS)
  • Eat Out to Help Out
  • Coronavirus Statutory Sick Pay Rebate
  • Coronavirus Business Support Grants

HMRC’s guidance is clear that whether or not any tax is paid will depend on the business profits of the grant recipient (taking into account the grant and other business income and expenditure under normal tax rules), any other taxable income they may have and their personal and any other allowances to which they are entitled.

HMRC also has the power to recover payments and charge penalties when claimants have made support grant claims to which they were not entitled. There is no requirement to report COVID welfare payments made by a council such as those to help with council tax payments and housing benefit.

Loans, such as Bounce Back Loans or those from the Coronavirus Business Interruption Loan Scheme (CBILS), are not COVID-19 support payments.

If you need help sorting out your business accounts and covid grants, get in touch with us today to see how we can help you.

Source: HM Revenue & Customs Tue, 05 Oct 2021 00:00:00 +0100

More articles

Autumn Budget 2021 – Alcohol and Tobacco Duty
Autumn Budget 2021 - Alcohol and Tobacco Duty
October 28, 2021
As part of the Budget measures the Chancellor announced, to a big cheer, that the planned duty rates on
Autumn Budget 2021 – Creative industry tax reliefs
Autumn Budget 2021 - Creative industry tax reliefs
October 28, 2021
The sunset clause for the Museum and Galleries Exhibition Tax Relief (MGETR) was supposed to come into
Autumn Budget 2021 – Dividend tax rates
Autumn Budget 2021 – Dividend tax rates
October 28, 2021
As announced on 7 September 2021, the 1.25% increase in NIC contributions from April 2022 will be