On 24 September 2020, as part of the Winter Economy Plan, it was announced that tax payers with up to £30,000 of self-assessment tax liabilities who will find it difficult to make their tax payment due on 31 January 2021, including the deferred 31 July 2020 payment on account, can arrange a self-serve time to pay arrangement of up to 12 monthly instalments.
The self-serve time to pay arrangement can be applied for online at HMRC. However, interest will apply to unpaid tax from 1 February 2021. Penalties will also apply from 1 February on any unpaid tax but will not be charged if a time to pay arrangement is in place before 31 January 2021. Currently HMRC have not issued any details on eligibility criteria for the self-serve time to pay arrangement apart from that it is limited to liabilities of up to £30,000.
If you do not qualify for the self-service time to pay arrangement because your liability is higher than £30,000, you may still be able to arrange to pay the tax due in instalments, if you contact HMRC payment support service on 0300 200 3835 to request a time to pay arrangement.
We would recommend that if you do need to arrange a time to pay with HRMC that it is done in advance of the payment due date of 31 January 2021. This means having your tax return for the year ended 5 April 2020 filed with HMRC and that you have carried out a review of your 2020/21 payments on account before the 31 January 2021.
Please contact our tax team if you have any questions regarding SEISS or any other issues.