UT (Tax & Chancery) UT-2024-000098 - [2025] UKUT 00247 (TCC)

Sections 71 and 76 of the Coronavirus Act 2020, as originally in force, provided the Treasury with the power to direct HMRC’s functions in relation to the coronavirus pandemic. By this power, the Treasury introduced the First SEISS Direction on 30 April 2020 which provided for the making of support payments to the self-employed. This was followed by the Second SEISS Direction on 1 July 2020 and further SEISS directions during the coronavirus pandemic.

Paragraph 3 of the Schedule to the First SEISS Direction, under which the Respondent’s First Claim was made, sets out certain eligibility requirements for support payments under the SEISS.

In particular, paragraph 3.2 of the Schedule to the First SEISS Direction provides as follows: “A claim must be made by a qualifying person.”

Paragraphs 4.1 and 4.2 of the Schedule then provide as follows:

Paragraph 13 of the Schedule also contains the following definition: ‘“trade” means a trade, profession or vocation the profits of which are chargeable to income tax under Part 2 of ITTOIA 2005 (trading income) and in this definition “trade” has the same meaning as in section 989 of ITA 2007.’ Section 989 ITA 2007 in turn provides that ‘“trade” includes any venture in the nature of a trade.’

The Second SEISS Direction, under which the Second Claim was made, extended the SEISS and incorporated the eligibility requirements contained in paragraph 3 of the Schedule to the First SEISS Direction. Paragraph 3 of the Schedule to the Second SEISS Direction provides that “all the provisions of SEISS continue to apply to this extension as they apply in relation to SEISS… unless the context otherwise provides.” Paragraph 10.1 of that same Schedule also specifies that: “A claim for payment under SEISS Extension (a “SEISS Extension payment”) must be made in accordance with paragraph 3 of SEISS on or before 19 October 2020.” Paragraph 12.1 of the Schedule to the Second SEISS Direction then defines “SEISS” by reference to the First SEISS Direction: ‘“SEISS” means the Self-Employment Income Support Scheme set out in the Schedule to the direction given by the Treasury to HMRC on 30 April 2020 in exercise of the powers conferred by sections 71 and 76 of the Coronavirus Act 2020.’

Accordingly, the Second Claim was also subject to the requirements of paragraphs 3.2, 4.1 and 4.2 of the Schedule to the First SEISS Direction set out above.

Paragraph 8 of Schedule 16 to the Finance Act 2020 provides for the full amount of any payments received under the SEISS to which any claimant was not entitled to be recoverable as income tax. Paragraph 9, in so far as relevant, empowers HMRC to recover such income tax by means of an assessment: