Tough year forces almost 25,000 Self-Assessment taxpayers to opt for monthly tax payments so far
Following a tough year financially for many self-employed workers, almost 25,000 people have opted to set up an online payment plan to manage their tax liabilities, HM Revenue and Customs (HMRC) has revealed today.
The Self Assessment customers will be able to manage their tax liabilities in up to 12 monthly instalments with the liabilities so far totalling a huge £69.1million.
In October, HMRC increased the threshold for self-serve Time to Pay arrangements from £10,000 to £30,000 for Self Assessment customers. Once tax payers have completed their 2019-20 tax return and know how much tax they owe, customers can use the self-serve facility to set up monthly direct debits and spread the cost of their tax bill.
The 31 January Self Assessment deadline is less than three weeks away but for almost 25,000 customers, who have completed their tax returns and set up an online payment plan since 1 October 2020, they can start 2021 knowing their tax liabilities are under control.
Karl Khan, HMRC’s Interim Director General for Customer Services, said: “We know the past year has been tough for many businesses and self-employed people, which is why we’re helping them spread the cost of their tax bill into monthly payments.
“Self Assessment customers can use the self-serve Time to Pay facility for amounts up to £30,000 with almost 25,000 customers already benefiting from the service.”
The self-serve Time to Pay threshold was increased to help businesses and individuals who have been affected by the coronavirus pandemic. Supporting Self Assessment customers to manage their tax bills can help ease their financial commitments into more manageable monthly payments. To date, the average value of payment plans set up online is £2,821.
Customers can apply for the payment plan via GOV.UK. However, they must meet the following requirements:
the debt needs to be between £32 and £30,000
the payment plan needs to be set up no later than 60 days after the due date of a debt
they need to have no outstanding tax returns, other tax debts or other HMRC payment plans set up.
