Time To Pay Service – Increase In Limit
One of the measures announced by HMRC to support businesses during coronavirus pandemic was the introduction of service of Time To Pay for those affected by COVID-19.
Businesses and self-employed people in financial distress and with outstanding tax liabilities may be eligible to receive support with their tax affairs by accessing this service.
An online payment plan was available to set up installment arrangements for paying tax liabilities up to £10,000. This limit has now been increased to £30,000 from 1 October 2020.
HMRC estimates around 95% of Self-Assessment customers who are due to make payments on 31 January 2021 could qualify to implement a Time To Pay arrangement using the self-serve, online Time To Pay facility, without needing to speak to an HMRC adviser.
Taxpayers that want to use the online option must meet the following requirements:
- Have no outstanding tax returns
- No other tax debts
- No other HMRC payment plans set up.
The debt needs to be between £32 and £30,000, and the payment plan needs to be set up no later than 60 days after the due date of a debt.
Taxpayers using self-serve Time To Pay will be required to pay any interest on the tax owed. 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, may still be able to set up a Time To Pay service arrangement by calling the Self-Assessment payment helpline.
If you are looking for more information; book a call with us.