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Struggling to pay personal tax bill?

The deadline is fast approaching for paying your personal tax bill, but what you can do if you are still struggling. The current situation is making more difficult to fulfil the tax bill than ever before. HMRC already has deferred the second payment on account from July 2020 to January 2021.

So what can you do now if the payment is expected?

Firstly, do not ignore, as you will be paying interest on late tax payments and penalties if you are more than 30 days late and this is the last thing needed at the moment.

Secondly, HMRC introduced additional 12 month extension through Time to Pay service due to Coronavirus (COVID-19). Time to Pay is the self-service facility allowing payments deferred from July 2020, and those due in January 2021, not to be paid until January 2022. You will be able to agree the arrangement with HMRC, which will be based on your individual circumstances. Therefore you will need to complete an income and expenditure assessment to work out how much you can afford to pay and how much time you'll need to settle your debt. You will be charged interest on this facility but no additional penalties for late payment. Time to Pay arrangement is flexible, so if you have money, you can pay more at any time. Also if your situation worsens, you can extend the arrangement.

The service is available if:

  • you owe £30,000 or less

  • you have no outstanding tax returns

  • you have no other tax debts or payments plans set up

  • it's less than 60 days after the payment deadline

You might still be able to use the arrangement if you owe more than £30,000 or need more than 12 months, you will need to call the HMRC helpline instead. The helpline phone number is 0300 200 3822.

If you need any advice on tax payment or help with calculating your taxes please contact us.

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