New figures published by HMRC have revealed that some 25,000 taxpayers have set up an online payment plan to manage their tax liabilities spreading payments of £69 million for up to 12 monthly instalments.
This follows an increase in the limit for making an online payment plan to £30,000 (previously £10,000) that took effect from 1 October 2020. Taxpayers with outstanding tax liabilities may be eligible to receive support with their tax affairs by using this service.
The deadline for submitting your 2019-20 Self-Assessment tax returns online was 31 January 2021. Once a return has been submitted you can use the self-serve facility to set up monthly direct debits and spread the cost of your tax bill. The payment plan needs to be set up no later than 60 days after the due date of the debt.
In order to use the online payment plan you must meet the following requirements:
- Have no outstanding tax returns
- No other tax debts
- No other HMRC payment plans set up.
In addition, your debt needs to be between £32 and £30,000. You can choose how much to pay straight away and how much you want to pay each month. Interest will be applied to any outstanding balance from 1 February 2021.
Taxpayers with Self-Assessment tax payments of over £30,000, or who need longer than 12 months to pay in full, can still apply to set up a time to pay arrangement by calling the Self-Assessment payment helpline or the dedicated COVID-19 helpline.
Source: Informanagement