Self-Assessment customers can now apply online to HMRC to spread the cost of their tax bill into monthly payments without the need to call them.
The online self-serve 'Time to Pay' service, has been increased to £30,000 for Self-Assessment customers, to help ease any potential financial burden they may be experiencing due to the coronavirus pandemic.
Once you have completed your tax return for the 2019-20 tax year, you can use the online self-serve 'Time to Pay' service through GOV.UK to set up a direct debit and pay any tax that is owed in monthly instalments, up to a 12-month period.
If you wish to set up your own self-serve 'Time to Pay', you must meet the following requirements:
• No outstanding tax returns
• No other tax debts
• No other HMRC payments set up
• your Self-Assessment tax bill is between £32 and £30,000
• It is no more than 60 days since the tax was due for payment.
If you do not meet these requirements, you might still qualify for Time to Pay, but you will need to call HMRC to set this up.
If you set up a 'Time to Pay' arrangement, you will have to pay interest on the tax paid late.
Interest will be applied to any outstanding balance from February 1, 2021.
Nick Charnley, tax manager at Ellis & Co said: “It’s great that individual taxpayers have the option to spread their self-assessment tax burden over 12 months during these difficult times but, they should also be mindful that late payment interest will still accrue until the liability is paid in full.”