Almost 100,000 UK Self Assessment taxpayers have opted to pay their tax in installments via online payment plans since April 2021, according to HMRC.
Collectively, these taxpayers owe the Treasury £310 million worth of tax.
Once a taxpayer has filed their 2020/21 Self Assessment tax return they can set up a ‘Time to Pay arrangement’ for up to 12 months on debts of up to £30,000.
This can be done online at GOV.UK without speaking to HMRC. However, those owing more than £30,000 or people who need longer to pay, need to contact HMRC to discuss their payment options.
The deadline for filing tax returns, paying any tax owed or setting up a payment plan was 31 January, but HMRC has given customers extra time to meet their obligations without facing penalties.
This means:
- Anyone who did not file their return by the 31 January deadline will not receive a late filing penalty if they file by 28 February.
- Anyone who did not pay their tax liabilities by the 31 January deadline will not receive a late payment penalty if they pay their tax in full, or set up a Time to Pay arrangement, by 1 April.
- If customers owe more than £30,000, or need longer to pay, they should call the Self Assessment Payment Helpline on 0300 200 3822.
From 1 February, all outstanding amounts were subject to interest – the rate of which has and will increase this month, as reported here.
The 2020/21 tax return must include any grants or payments from any of the government’s Covid-19 support schemes, up to 5 April 2021, such as:
• Self-Employment Income Support Scheme (SEISS).
• Coronavirus Job Retention Scheme.
• Other Covid-19 grants and support payments such as self-isolation payments, local authority grants and those for the Eat Out to Help Out scheme.
The £500 one-off payment for working households receiving tax credits should not be reported in Self Assessment.
