Introduction
- This is our approach to all articles.
- HM Revenue & Customs (HMRC) is reminding taxpayers of the option to set up a self-serve time to pay arrangement if they are unable to pay their self assessment bill.
Guidance
- The limit for a self-serve time to pay arrangement, which was increased during the pandemic, remains at £30,000 tax due.
- If taxpayers can’t pay their 2020/21 self assessment (SA) tax liability in full by the due date (generally 31 January 2022), they can set up their own time to pay arrangement online if they:
- have filed their tax return for 2020/21;
- owe less than £30,000;
- are within 60 days of the payment deadline; and,
- plan to pay their debt off within the next 12 months or less.
- If taxpayers owe more than £30,000, or need longer to pay, they should phone the self assessment payment helpline on 0300 200 3822 to make an arrangement.
Advice from HMRC
- To avoid a 5% late payment penalty, you should set up the arrangement within 30 days of the due date (generally by 1 March 2022), although the service is available for 60 days following the due date.
- The service has proved to be popular to date with more than 20,000 SA taxpayers using it since April 2021 to spread £46m of tax due for 2021/22.
- Last year, 123,000 taxpayers used it to spread the cost of £460m of 2019/20 liabilities.
- Unfortunately, the self-serve time to pay facility is not available to agents as HMRC can only accept direct debit mandates set up by taxpayers themselves.
- SA taxpayers making payments on account who know that their 2021/22 tax bill is going to be lower than 2020/21 bill may wish to take action to reduce their payments on account.