Is this fraud?

[catdogcatdogfish]

Hi, I'm going to keep this as vague as possible and make no mention as to who it is as it's very outing (not me)

I know someone that was employed and on furlough (now returned). This person also did odd work on the side and had a business premises. They took the 10k grant that was offered too. Are they allowed to effectively have 2 lots of "benefits" paid due to the pandemic?

Surely HMRC will be aware of their income from employment as well as self-employment?

I figured somebody in their position would pay a higher tax bill eventually?

I'm happy to be corrected!

Do you know the reason why somebody has both a business and a job? It clearly doesn’t pay to have one or the other so therefore financially they would’ve been effected from both the job and business during the pandemic. The furlough covered wages for not working, but without the pandemic they would’ve worked. The grant will have helped them with running costs of the business whilst missing out on some business. I personally wouldn’t have a problem with it as they’re entitled to both and nothing stops anyone from having a business and a job unless their company says they can’t. Some people work 20 hours in employment and the rest on their business, I wouldn’t begrudge someone getting the furloughed payment and a grant because it’s what they’re entitled to.

@Whatdowehaveherethen

Yes pay higher tax and they wouldn’t have received the grant if they weren’t registered as a business either, as they’re processed by council and the council do make checks even with those premises is let from.

Sounds OK to me if they qualified for both schemes

As long as over 50% of earnings came from self employment they could claim both.

You were also allowed to continue working in your self employment.

They had been self employed but weren't earning enough. So decided to wrap in and get a job, but the premises were owned so still kept. They did small jobs for friends and family on the side from the premises when required. The council wrote and offered the grant so they applied and were given it.

I just had visions of them being bitten when the government starts auditing.

@BF2478 I thought so, thank you.

OP, HMRC are aware I f this person earnings from both employment and self-employment. If they have received too much, this will be corrected at the end of the tax year.

Are you concerned that they may not be able to afford their tax bill or do you think it's unfair they've received support from multiple avenues?

I will not ask because I know of similar cases where the self employed have received the grant as well as UC and they may have been unaware that any income other the threshold will be recouped in tax. Its a complicated system, especially with Covid. I think most people that have done similar are just trying their best to live using whatever resources are available.

Keep in mind that a lot of this provision was made available without those using it understanding the full terms and conditions.

This doesn't sound like the self employment grant but that for a business premises.

It sounds like the council thinks the business is still running, so offered the grant. It could be that they meet the qualifying criteria even though the business is now more of a hobby that makes a little towards the cost of owning the building.

They wouldn't have been entitled to the SE grant as you had to have more than 50% of your income from SE in the qualifying years which it sounds like it doesn't apply in this case.

It might not bite them in the arse later because there's been lots of anomalies due to the need to put help in place quickly.

It's estimated that between 20 and 50% of SE people haven't been entitled to any help due to their circumstances being outside the scheme rules so it stands to reason that other people will have qualified in more than one category or not actually needing help.

The Covid support is all separate so it's possible to qualify for several different schemes at the same time. Of course, if he's lied on the claim form for one or the other then he'll probably get found out and have to return any grant he wasn't entitled to.

But the thing with the s/e grant and the business rates grant is that the "boxes to tick" were pretty simple - basically "have you been affected by covid" and "were you in business immediately before if affected you". Likewise for the business rates grant, I think the criteria is that the premises must not have been used for non business purposes at the time of the claim being made. None of that means that the grants have to be repaid if the business doesn't restart after covid, nor how long later or what extent the business starts again.

All very woolly and not properly thought through. But given up to 3 million self employed fell through the cracks and received nothing, the whole self employed support scheme etc has been a complete and utter shambles. Some people receiving far more than their losses, other people receiving nothing. Well done Rishi, you idiot!