LITRG warns of self-employed grant claimants’ tax hit

The Low Incomes Tax Reform Group (LITRG) notes that grants made under the self-employed income support scheme (SEISS) are taxable and likely to be included in claimants’ 2020-21 self-assessment tax returns. 

It is concerned that claimants might not appreciate that income tax and class 4 National Insurance is due on the grant and payable by 31 January 2022. LITRG fears that people could instead assume the amount is exempt from tax.

Victoria Todd said: ‘We urge HMRC to do as much as it can to publicise that the grants are chargeable to income tax and National Insurance, to reduce the risk of people being surprised by higher-than-expected 2020-21 tax bills.’