Enhanced payment plans kick in for self-assessment taxpayers

2nd October 2020

The self-employed and other self-assessment taxpayers can apply online to spread the cost of their tax bills into 12 monthly payments.

The online payment plan, announced in Chancellor Rishi Sunak’s winter economic plan, allows self-assessment customers to pay tax bills of up to £30,000 in instalments.

This is designed to help ease any financial difficulties they might be experiencing during the COVID-19 pandemic, and builds on the payment on account deferral in July 2020.

HMRC revealed self-assessment customers who are due to make tax payments on 31 January 2021 could qualify for the time-to-ay scheme using the self-serve online platform, without needing to call HMRC.

Customers who wish to set up the arrangement must not have any outstanding tax returns, other tax debts or other HMRC payment plans set up.

They must also have debts between £32 and £30,000, with payment plans needing to be set up no later than 60 days after the due date.

Customers using self-serve time-to-pay will be required to pay any interest on the tax owed, which will be applied to any outstanding balance from 1 February 2021.

Jesse Norman, financial secretary to the Treasury, said:

“We are supporting jobs by giving more breathing space to up to 11 million self-assessment taxpayers when managing their tax affairs.

“Enhancing time-to-pay should ease the financial burdens and protect the livelihoods of these taxpayers, as they navigate the months ahead.”

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