Are you a self-assessment taxpayer?
With little over a week until 1 April, have you paid any outstanding tax liabilities or set up your online payment plan? If the answer is no, in order to avoid a 5% late penalty, you need to take action now!
In view of the Covid 19 pandemic, HMRC announced last month that they were giving self-assessment taxpayers an extension to pay tax for the 2019/20 financial year or set up a payment plan – but arrangements must be in place by midnight on 1 April 2021.
How can I make payments?
You should have filed your online tax return by 28 February (this was extended from 31 January earlier this year) in order to avoid a £100 late filing fee.
If you haven’t settled your liabilities for the 2019/20 financial year, you can pay in full or set up a ‘Time to Pay’ plan by 1 April. The plan can help manage your self-assessment tax bill of costs up to £30,000 and will enable you to spread the payments into monthly instalments up to January 2022.
The payment deadline hasn’t changed, and other requirements must still be met. This means:
- the payment deadline was still 31 January 2021 and late payment interest of 2.6% will be charged for late payments. So, it is better to pay asap as the interest is charged on a daily basis from 1 February!
- you will incur a 5% late payment penalty for outstanding tax if a payment plan hasn’t been arranged by midnight on 1 April 2021. And additional late payment penalties will be charged on outstanding tax at 6 and 12 months (August 2021 and February 2022 respectively) without a plan in place.
Meet the deadline
To pay your outstanding self-assessment tax liabilities or to set up a monthly payment plan, please visit gov.uk by next Thursday 1 April
Payments on Account
Additionally, if you make Payments on Account and you already know that your 2021/21 tax bill will be lower than 2019/20, you can plan ahead and reduce your payments now. Find out how here.
How can we help?
We are available for advice or if you have any other business concerns following the latest government updates, contact your usual relationship practitioner, email intouch@haroldsharp.co.uk or call us on 0161 905 1616.