BIM40456 - Specific receipts: Coronavirus Support Payments - General rules

The taxation of Coronavirus Support Payments is governed by section 106 and Schedule 16 Finance Act 2020.

Coronavirus Support Payments include payments made under:

• the Coronavirus Job Retention Scheme (CJRS)
• the Self-Employment Income Support Scheme (SEISS)
• any other scheme subject to a direction given under section 76 Coronavirus Act 2020 (This includes the Eat Out to Help Out scheme)
• the Coronavirus Statutory Sick Pay Rebate Scheme (CSSPRS)
• any Coronavirus Business Support Grant Scheme (CBSGS)
• the Test and Trace Support Payment Scheme in England, the Self-Isolation Support Grant in Scotland and Self-Isolation Support Scheme in Wales.
• Any other scheme which may be included under a Regulation made by the Treasury.

CBSGS includes any other schemes under which a public authority makes grants with the object of providing support to businesses in connection with the effects of coronavirus or coronavirus disease. Such schemes include:

• in England:
  • Small Business Grant Fund
  • Retail, Hospitality and Leisure Grant Fund
  • Local Authority Discretionary Grant Fund
  • Fisheries Response Fund
• in Wales:
  • Welsh Government Business Grants (Grants 1 & 2)
  • Economic Resilience Fund
• in Scotland:
  • Business Support Fund
  • Newly Self-Employed Hardship Fund
  • Creative, Tourism & Hospitality Enterprises Hardship Fund
  • Pivotal Enterprise Resilience Fund
  • Aquaculture Hardship Fund
  • Sea Fisheries Hardship Fund
• in Northern Ireland:
  • Small Business Support Grant Scheme
  • Retail, Hospitality, Tourism and Leisure Grant
  • other coronavirus emergency and hardship funds

The above list is not exhaustive. If in doubt as to whether a scheme falls to be treated as a Coronavirus Business Support Grant Scheme, please contact Business Profits Trading Income team for advice.

Accounting for Coronavirus support payments referable to a business

For the purposes of Schedule 16 FA2020, “business” includes:

• a trade, profession or vocation;
• a UK property business or an overseas property business;
• a business consisting wholly or partly of making investments.

This guidance is predominantly written for trading businesses. It may be applied, with suitable adaptation, to other types of business.

All Coronavirus Support Payments are revenue in nature. Where these payments are referable to a trading business they are to be brought into account in calculating the profits of that business.

The taxability of Coronavirus Support Payments is subject to additional rules as outlined in BIM40457, BIM40458 and BIM40459. The application of some of these additional rules depend on the type of scheme under which the payments are made, which broadly fall into four categories:

• Self Employment Income Support Scheme (SEISS) [BIM40458]
• Employment-related schemes, which includes Coronavirus Job Retention Scheme (CJRS) and Coronavirus Statutory Sick Pay Rebate Scheme (CSSPRS) [BIM40459]
• Any other HMRC scheme created via a Direction under section 76 Coronavirus Act 2020 (Section 76 HMRC scheme), e.g. Eat Out to Help Out scheme.
• Coronavirus Business Support Grant Schemes (CBSGS)

SEISS and CJRS should be read as including the various extensions to these schemes, e.g. CJRS includes the Coronavirus Job Retention Bonus Scheme.

Where there is an assessment to recover overclaimed SEISS, CJRS, or payments made under any other Section 76 HMRC scheme (e.g. Eat Out to Help Out scheme), the amount of taxable Coronavirus Support Payments is reduced accordingly. Where a claimant otherwise makes a repayment of any amount received under a Section 76 HMRC scheme, this should be treated as a reduction in the amount of taxable income received from the scheme.

With the exception of SEISS - see BIM40458, the timing of recognition of Coronavirus Support Payments should be in accordance with GAAP or, where applicable, the Cash Basis - see BIM70000.