HMRC starts chasing up SEISS overpayments

HMRC has recently started to recover overpayments of Self-employment Income Support Scheme (SEISS) grants. The SEISS scheme allowed those who were self-employed or a member of a partnership to claim a grant if COVID-19 had impacted their business profit. This grant was given over five payments and is calculated by using the information provided by a taxpayers amended tax return. The last date you could apply for a claim was in September of 2021.

From April of this year, those whose fourth or fifth SEISS payments has decreased by more than £100 will receive a letter from HMRC. The letter will be asking for a repayment of overpaid amounts as well as an assessment and a date in which you must make the payment. If the payment is over 30 days late, a late payment penalty of 5% of the unpaid tax will be added onto the charge. Those who received a letter are required to use the payment reference beginning with X to complete the repayment.

If you do not receive a letter, you must tell HMRC within 90 days if an amendment to your tax return has affected your entitlement. If you do need to repay some of your grants, HMRC online tools found here can help to calculate what you owe.

Danielle Harvey, Director of Harvey, Telford, and Bates commented on the overpayments:

“The SEISS grant was a very helpful scheme for self-employed individuals during the COVID hardships, and with these overpayments emerging it may be difficult to pay the amount in full. HMRC have an affordable monthly payment option called A Time to Pay. These are worked out based on your income and how much you owe, with flexibility if circumstances change.”