Petition Waive the January 2021 tax bill for those who have been excluded from the SEISS

As with all aspects of the tax system, the Government keeps income tax rates under review and any decisions on future changes will be taken as part of the annual Budget process in the context of the wider public finances.

The Government understands that many self-employed people are facing immense pressures. To support them this year, HMRC gave people an extra month to file their tax returns without issuing late filing penalties, to help taxpayers and agents who are unable to meet the deadline. Late filing penalties will now not be issued for online tax returns received by 28 February. This gives taxpayers the breathing space they need to complete their returns without worrying about receiving a penalty.

Building on support offered by the Self-Assessment tax deferral offered in July, the Government is providing further support to the self-employed and other taxpayers in Self-Assessment by giving those who need it more time to pay taxes due in January through HMRC’s enhanced Time to Pay (TTP) ‘self-service’ facility.

Taxpayers with up to £30,000 of Self-Assessment liabilities due can use the ‘self-service’ Time to Pay facility to secure a plan to pay this over an additional 12 months. This means that in some cases, Self-Assessment liabilities that were due in July 2020 will not need to paid in full until January 2022. Any Self-Assessment taxpayer who is not able to pay their tax bill on time, including those who can’t use the online service, can continue to use HMRC’s Time to Pay Self-Assessment helpline to agree a payment plan.

Throughout the crisis, the Government’s priority has been to protect lives and livelihoods, providing a wide-ranging economic response that is one of the most substantial globally and taking unprecedented steps to support families, businesses and the most vulnerable. This includes support for self-employed individuals through the Self-Employment Income Support Scheme (SEISS) which, as of 31 December, had received claims from around 2.7m self-employed individuals across the first three grants, totalling over £18.9bn.

In designing and delivering the SEISS, the Government prioritised delivering support to as many people as possible while guarding against the risk of fraud or abuse. This meant making difficult decisions, and the Government recognises that some of the eligibility criteria and conditions that were vital to ensuring that these schemes work for the vast majority meant that some people did not qualify.

However, as the National Audit Office report acknowledged, the Government was right to introduce the SEISS, which has been successful in helping to protect the livelihoods of millions of people and is just one element of a wider £280 billion package of unprecedented support.

Those ineligible for the SEISS may still be eligible for other elements of the support available. The Universal Credit standard allowance has been increased for 2020-21 and the Minimum Income Floor temporarily relaxed, so that where self-employed claimants' earnings have fallen significantly, their Universal Credit award will have increased to reflect their lower earnings. In addition to this, they may also be able to access other elements of the package, including Bounce Back loans, tax deferrals, rental support, mortgage holidays, self-isolation support payments and other business support grants.

For example, the Government has introduced the Local Restrictions Support Grant (LRSG) (Closed), giving businesses forced to close due to national or local restrictions up to £3,000 per month. In addition, these businesses will benefit from one-off grants of up to £9,000 as announced on 5 January. Similarly, where local areas were subject to enhanced restrictions on socialising, in particular a ban on indoor household mixing, LAs will receive funding that will enable them to make grants to hospitality, leisure, and accommodation businesses worth up to £2,100 per month.

Businesses which are not eligible for the grants for closed businesses may be able to benefit from funding from the Additional Restrictions Grant. The Government recently increased the funding available under this scheme to £1.6 billion across England. It is up to each local authority to determine eligibility for this scheme based on their assessment of local economic need; the Government encourages local authorities to support businesses which have been impacted by restrictions, but which are ineligible for the other grant schemes.

During this difficult time the Treasury will continue to work closely with employers, delivery partners, industry groups and other Government departments in order to understand and address the long-term effects of Covid-19 and the challenges it poses to the wider economy.

HM Treasury