Once a customer has filed their 2020/21 Self Assessment tax return, they can set up a Time to Pay arrangement for up to 12 months on debts up to £30,000, that they are unable to pay in full. This can be done online at GOV.UK without speaking to HMRC.
Since April 2021, Self Assessment customers have used the online Time to Pay service to pay more than £310 million worth of tax in instalments. If a customer owes more than £30,000, or needs longer to pay, they should contact HMRC to discuss payment options.
The deadline for filing tax returns, paying any tax owed or setting up a payment plan was January 31 but, this year, HMRC has given customers extra time to meet their obligations without facing penalties. This means:
- anyone who did not file their return by the January 31 deadline will not receive a late filing penalty if they file by February 28;
- anyone who did not pay their tax liabilities by the January 31 deadline will not receive a late payment penalty if they pay their tax in full, or set up a time to pay arrangement, by April 1;
- If customers owe more than £30,000, or need longer to pay, they should call the Self Assessment Payment Helpline on 0300 200 3822.
- From February 1, all outstanding amounts were subject to interest.
The 2020/21 tax return also covers earnings and payments during the pandemic. Customers will need to declare if they received any grants or payments from the COVID-19 support schemes up to April 5 2021 on their Self Assessment, as these are taxable, including:
- Self-Employment Income Support Scheme
- Coronavirus Job Retention Scheme
- other COVID-19 grants and support payments such as self-isolation payments, local authority grants and those for the Eat Out to Help Out scheme.
However, many freelancers and contractors were omitted from such payments during the Covid pandemic and felt, at the time, that they had been overlooked by the Government's support.
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Susie Hughes © Shout99 2022