Time to pay for Self Assessment

Self Assessment tax payers can now apply online for additional support to help spread the cost of their tax bill into monthly payments without the need to call us.

The online payment plan service has been increased to £30,000 for Self Assessment customers, to help ease any potential financial burden they may be experiencing due to the coronavirus pandemic.

Once tax payers have completed their tax return for the 2019-20 tax year, they may have the option of using the online self-serve ‘Time to Pay’ facility through GOV.UK to set up a direct debit and pay any tax that is owed in monthly instalments, up to a 12-month period.

If tax payers wish to set up their own self-serve ‘Time to Pay’ arrangements, they must meet the following requirements:
• no outstanding tax returns
• no other tax debts
• no other HMRC payment plans set up.

The debt needs to be between £32 and £30,000 and the payment plan needs to be set up no later than 60 days, after the due date of a debt.

Tax payers using self-serve ‘Time to Pay’ will be required to pay any interest on the tax owed. Interest will be applied to any outstanding balance from 1 February 2021.

Since HMRC has a set up a phone helpline to support businesses and self-employed people concerned about not being able to pay their tax due to coronavirus (COVID-19) last week, SME businesses have started getting support to delay payment of their VAT and PAYE liabilities. Some have reported that HMRC is not asking for or only requiring minimal evidence and extending their payment deadlines for the foreseeable future.

VAT Deferral
All UK VAT registered businesses, including charities, can defer VAT payments due with their VAT returns between 20 March 2020 until 30 June 2020. No UK VAT registered business will have to make a VAT payment alongside their VAT return to HMRC in that period. Normal VAT payment due during this period are 7 April, 7 May or 7 June 2020 or the monthly payments due on each of these dates.

This is an automatic offer with no applications required. Businesses will not need to make a VAT payment during this period. Taxpayers will be given until the end of the 2020 to 2021 tax year to pay any liabilities that have accumulated during the deferral period. VAT refunds and reclaims will be paid by the government as normal.

The deferral is only for the VAT payment, businesses are supposed to file the VAT returns by normal due dates. Smaller companies with direct debits to pay VAT to HMRC will also need to cancel these immediately otherwise the money will be deducted automatically. The Treasury said it could not cancel them unilaterally.

Smaller companies with direct debits to pay VAT to HMRC will also need to cancel these immediately otherwise the money will be deducted automatically. The Treasury has said it could not cancel unilaterally or cancel direct debits. Instead HMRC must not be collecting the direct debit on the normal VAT due date when the business submits the VAT return.

Businesses will be receiving all VAT refunds as normal.

If you have deferred VAT payments that were due between 20‌‌‌‌‌‌ March and 30‌‌‌ June 2020, now have the option to pay in smaller payments over a longer period.  Originally payable by the end of March 2021, businesses can make up to 11 smaller monthly payments, interest free.  All instalments must be paid by March 2022.. You can use the VAT Deferral New Payment Scheme to spread these payments over equal instalments up to 31‌‌‌ March‌‌‌ 2022. Alternatively, you can make payments as normal by 3‌‌‌1‌‌‌ March 2021, or make Time To Pay arrangements with HMRC if you need more tailored support.

More information on the VAT Deferral New Payment Scheme will be available on GOV.‌‌‌UK in the coming months

The non-payment of VAT will be ignored for any VAT default surcharges and interest calculation.

The helpline allows any business or self-employed individual who is concerned about paying their tax due to coronavirus to get practical help and advice.

If you run a business or are self-employed and are concerned about paying your tax due to coronavirus, you can call HMRC’s helpline for help and advice: 0800 0159 559

For those who are unable to pay due to coronavirus, HMRC will discuss your specific circumstances to explore:

• agreeing an instalment arrangement

• suspending debt collection proceedings

• cancelling penalties and interest where you have administrative difficulties contacting or paying HMRC immediately The helpline number is 0800 0159 559 – and is an addition to other HMRC phone contact numbers.

The helpline is open from Monday to Friday 8am to 8pm, and Saturday 8am to 4pm (excluding bank holidays).

Other HMRC business payment support contact details can be found here.