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SEISS claims process ‘complex and flawed’

Written by: Emma Lunn
Tight deadlines could see people missing out on vital support, according to a tax advisory firm.

The Self Employed Income Support Scheme (SEISS) has proved controversial from the start due to the number of self-employed workers and business owners excluded from the scheme.

One group of excluded workers were those new traders who had started their business in 2019/20 but had yet to submit their first tax return.

However, in the Budget, chancellor Rishi Sunak announced that up to 600,000 more self-employed people would be eligible to claim the fourth and fifth SEISS grants – as long as they had submitted a tax return by 3 March 2021.

The move was a welcome relief for many of those who had been unable to access the financial support they needed. However, vague details, complicated process, tight deadlines and fears about scammers could mean many miss out.

Verification process

People who started their business in 2019/20 will need to provide additional evidence to HMRC in order to claim the grant.

Taxpayers who started trading as a self-employed business after 5 April 2019 will receive a SEISS ‘verification letter’ from HMRC.

Up to two weeks after the letter is sent an HMRC officer will call the contact number given on the taxpayer’s 2019/20 tax return. The taxpayer needs to answer HMRC’s call and only three attempts will be made.

If none of those three attempts are successful, the taxpayer will have failed the pre-verification – and won’t get the grant.

When the taxpayer does speak to HMRC he or she must confirm or supply their email address. They must also agree to receive a link to a Dropbox account to that email address.

Chris Bowles, a director at financial expert Old Mill, says it is important that businesses understand that there is a verification process that must be completed before they can make a claim, and that if they are not ready to respond, they could miss out, because the deadlines are very tight.

For example, once those applying for the grant have been contacted by HMRC and then been sent an email with instructions on how to verify their identity, they then have just two days to upload digital copies of their ID and bank documents to the HMRC Dropbox. If they don’t, the Dropbox link will expire, and they will fail the pre-verification.

Bowles said: “This complex process appears to have a number of potential flaws and may present challenges for many newly self-employed business owners who may not be familiar with what’s required or are unaware of the very tight deadlines attached to some of the steps involved in the pre-checks.

“There are a number of areas where things can go wrong (just opening a brown envelope from HMRC for instance), and I have real concerns that some people may have difficulties negotiating these pre-verification checks or inadvertently miss deadlines.

“There’s also a fear that many traders will see this HMRC call as another sophisticated attempt to obtain sensitive personal information at a time when attacks from scammers are widespread.”

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