Self employed gov grant

[Beefsmith]

I haven’t read up on this so don’t know the rules but we’ve a guy who claimed the self employed grants off the gov and is now got three more on the cards up to next April. As I said I haven’t read up on this but surely you can only claim them if you aren’t working? He’s worked throughout earning normal wages as he would do in a normal year. He’s not down on hours so isn’t short of money in the financial year. He says it’s all taxed so next year he’ll pay more tax because he’s had his normal wages and then the grants on top, but surely the idea is it’s paid to people who’ve lost out on work?

 

[farmerdan7618]

The self employed grant isn't quite the same as furlough, the terms used were 'adversely affected by the coronavirus pandemic', so needs to fit that, rather than have no work at all.

However, normal wages, and you referring him as an employee makes me think HMRC could have some questions.

There is a useful status checker for employment status here and just bear in mind it is you who are responsible for any additional taxes or National Insurance that HMRC think they have missed out on, and not your chap doing the work.

 

[farmerm]

The mind boggles... How is he claiming self employment grant if he is your employee or is he "self-employed" working for you on contract? He can only claim, I think, 80% of what his average declared self employment earning have been over the past 3 years tax returns... HMRC could deem it to be false self employment on your part...?

If HMRC notice he claimed the self employed grant and his income for the year was increased not decreased they could and should ask him to justify his claim. Who knows how many will get challenged, it is possible some could end of paying tax on the grant only to later have the grant money demanded back.

 

[Beefsmith]

Corrected the op. He’s not an employee. He’s self employed. He works with us 3 days a week and then another farm for 2 days. It’s all above board, just my choice of words were bad. His income this year from work is not down but he’s still received the grants.

 

[deleted user 837354]

I'm confused. If someone is self-employed and experienced no loss of income, why would they claim the grants?

 

[Still Farming]

Hmrc, to claim back 100% of self employed grant,

My accountant told me today that they will want all this grant back if you can show your business had be badly affected by the virus, l suppose wool is worthless because of virus. Can't believe they would try and get it back but there up for anything to screw you over.

thefarmingforum.co.uk

Maybe info here.

 

[crofteress]

All these people who claimed the grants , when they do their books for 2020 \21 and their income hasn't dropped significantly , they will have to answer to hmrc. I am down by 30 % turnover as I'm a tourist business as well as the cows , suckler income will be up but not going to make a big difference , I can't claim the November grant as my tourist business is closed for the winter but the income I normally live on is a third down .

 

[Werzle]

I'm confused. If someone is self-employed and experienced no loss of income, why would they claim the grants?

Why not if they had the letter/email/txt saying they were eligible. Every other s#d is claiming and most of them were fiddling the books/taxes pre covid, wise up and claim what you can. We will all have to give it back in the form of higher taxes so why be the one left out. Governments not bothered, they want money circulating to stimulate the economy. Gov paid a middle man 20m to source below standard ppe and you think they are going to chase average joe for peanuts

 

[deleted user 837354]

Why not if they had the letter/email/txt saying they were eligible. Every other s#d is claiming and most of them were fiddling the books/taxes pre covid, wise up and claim what you can. We will all have to give it back in the form of higher taxes so why be the one left out. Governments not bothered, they want money circulating to stimulate the economy. Gov paid a middle man 20m to source below standard ppe and you think they are going to chase average joe for peanuts

I think you underestimate the patience and determination of the people that work for HMRC...

 

[Simon Chiles]

Corrected the op. He’s not an employee. He’s self employed. He works with us 3 days a week and then another farm for 2 days. It’s all above board, just my choice of words were bad. His income this year from work is not down but he’s still received the grants.

Just because he works for someone else for two days a week doesn’t make him self employed. He can be employed for more than one person at once or even employed and self employed at the same time. To qualify for self employment he has to meet certain requirements such as supplying his own tools and materials or able to sub the job out to another person etc. As has been said above if HMRC decide that he isn’t self employed they will wanting you to pay his tax and NIC contributions that they will deem you’ve avoided. If they start questioning him why his wages haven’t dropped and he has claimed the grant you might find that it gets revealed. I’d be concerned if I was in your position if everything isn’t completely watertight.

 

[Werzle]

I think you underestimate the patience and determination of the people that work for HMRC...

Me and millions more including about every accountant in the land. As long as you can pay it back if asked crack on

 

[serf]

I'm confused. If someone is self-employed and experienced no loss of income, why would they claim the grants?

My memory may be wrong but think the first grant said adversely affected but didn't say financially affected to claim, but my memory is sh@t ...

 

[crofteress]

My memory may be wrong but think the first grant said adversely affected but didn't say financially affected to claim, but my memory is sh@t ...

Adversely affected meaning if you had to spend money on signage and screens etc etc , the November one you have to have been affected by reduced demand .

 

[serf]

You could say that waiting for supplies , feed , fencing ect was affecting you because you had to wait , all a bit grey early on .

 

[farmerm]

My memory may be wrong but think the first grant said adversely affected but didn't say financially affected to claim, but my memory is sh@t ...

Yes that was the case. I had partners shielding, children home schooling, couldn’t stay and take stock home if unhappy with price, certainly adversely affected in several other ways too. I haven’t claimed the later grants though as conditions have changed. I could have tried it though, it’s a bit like a free entry in a lottery! Many will have. Time will tell who ends up paying grants back... I think the scale will have HMRC overwhelmed for a decade though

Here’s one to ponder. Tax and NI have to be paid on grant income, what will happen where grant money is demanded back? How will tax and NI paid on the grant money be reclaimed

 

[serf]

It's all an unknown how they will respond to claims , I think the later claims may be harder to justify for livestock farming anyhow .

 

[kiwi pom]

Corrected the op. He’s not an employee. He’s self employed. He works with us 3 days a week and then another farm for 2 days. It’s all above board, just my choice of words were bad. His income this year from work is not down but he’s still received the grants.

Sounds like he's still employed to me.
I'd be having a word, you could get end up with a big bill, although I have heard of businesses that have got away with a bill as long as they make staff employed straight away.

 

[neilo]

Sounds like he's still employed to me.
I'd be having a word, you could get end up with a big bill, although I have heard of businesses that have got away with a bill as long as they make staff employed straight away.

if he works for two separate businesses, and invoices them for his services, then he is self employed. There used to be something about having to provide their own tools/clothing, but plenty of self employed folk just supply their Labour, quite legitimately.

 

[deleted user 837354]

if he works for two separate businesses, and invoices them for his services, then he is self employed. There used to be something about having to provide their own tools/clothing, but plenty of self employed folk just supply their Labour, quite legitimately.

I'm not sure this is really how I would interpret the rules...

 

[kiwi pom]

if he works for two separate businesses, and invoices them for his services, then he is self employed. There used to be something about having to provide their own tools/clothing, but plenty of self employed folk just supply their Labour, quite legitimately.

If they're not doing anything different to an employee and work set hours on regular days, I think you're on dodgy ground. It's really just a way for employers to dodge responsibility. One good thing about it, if the authorities decide he should have been employed its the employer that gets the bill - at least that's how I understand it?
Getting people into Ag is hard enough without employers making staff be self employed contractors.