Tax Talk: HMRC offers greater flexibility for tax payments
Read time: 2 mins
Service: Sector: For customers feeling the widespread financial squeeze caused by the Coronavirus pandemic, help is available for paying tax liabilities provided they meet certain criteria. HMRC announced revisions to its Time To Pay scheme, with an increase in the threshold to £30,000 for Self Assessment customers. The new arrangements have applied since 1 October.
Under the updated system, individuals with Self Assessment liabilities of up to £30,000 can apply online for additional support to help spread the cost of their tax bill into monthly payments without the need to call HMRC. The payment will be taken via monthly direct debit.
Previously, the threshold for making this arrangement online was £10,000.
What are the criteria?
The following requirements must be met to benefit from the new scheme:- individuals must have no:
- outstanding tax returns
- other tax debts
- other HMRC payment plans set up
- the debt must be between £32 and £30,000
- the payment plan must be set up no later than 60 days after the payment due date
What if my bill is higher than £30,000?
Individuals who have tax return liabilities of over £30,000, or need longer than 12 months to settle their tax liabilities should contact HMRC Self Assessment Payment Helpline on 0300 200 3822.Interest will be applied to any outstanding balance from 1 February 2021. Currently, HMRC’s late payment interest rate is 2.60% annually.
Further information about the Time To Pay arrangements can be found on HMRC website at https://www.gov.uk/pay-self-assessment-tax-bill/pay-in-instalments. But beware: everyone should be alert to scams claiming to be from HMRC offering to help pay any tax owed.