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TODAY'S OTHER NEWS

Planning to defer your self assessment payment?

Are you facing cash flow difficulties? Buy-to-let landlords suffering hardship as a consequence of the coronavirus pandemic can defer their July tax payment on account. 

Research shows that not all self-assessment tax-paying landlords are aware that HM Revenue and Customs (HMRC) has updated its guidance enabling people to benefit from an extension to the July payment date. 

Consequently, anyone who is due to submit a self-assessment income tax payment on July 31, including those with rental and investment income, now has until January 31, 2021 to make this payment.

According to the guidance, this deferment is optional and anyone who is still able to pay their second self-assessment payment by the July deadline are being urged to do so. 

No penalties or interest for late payment will be charged in the deferral period.

Fiona Fernie, a tax dispute resolution partner at Blick Rothenberg, said: “It is important for taxpayers to think now about the likely level of their income this year and what the tax is they are going to have to fund in January and if they conclude that they will not be pay because of lack of income due to Covid-19 they should let HMRC know immediately.” 

She added: “HMRC have said that July tax payments for anyone who pays be self-assessment can be delayed until January but if they have the money, I would urge them to pay now so that they are not faced with a double bill.”

Many taxpayers will still be worried that even if they pay now, they may not be able to pay what they owe in January. But if you are in this position, simply alert HMRC now so that they will be able to get a pay arrangement. 
 
According to Fernie, HMRC will be sympathetic to what has happened to people’s finances but the earlier they are told the better it will be for both parties.
 
She added: “Understandably most people are primarily thinking about how to pay the mortgage and put food on the table, but it is important to remember that the postponement of the 31 July 2020 payment on account merely delays the liability; it does not wipe it out.  
 
“Taxpayers will still have the problem of how they fund their tax bills in January 2021, potentially before they have seen a full recovery of their business. 
 
“It is vital that they think now about how they will cope so that if necessary, they can approach HMRC for a Time to Pay (TTP) arrangement before they face an imminent deadline.” 
 
Fernie added: “If they do not do this it could be difficult in January and HMRC will not be so sympathetic and could launch inquiries which will be time consuming for HMRC and stressful for the taxpayer. All that is required is a sensible piece of housekeeping.”

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    I shall be paying my tax in July as normal.

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    How do you let HMRC know? They never answer the phone!

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    They do eventually answer (at least I know they did before the virus), but make sure you have unlimited calls, plenty of other things to do whilst waiting, and leave your phone on speaker for when they do eventually answer.

     
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    you should have planned ahead and put your tax aside.
    I will be paying mine on time ! too

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    I shall pay mine this month so its done, But I`m sure I read that you do not need to notify them to take advantage of this offer . Its bad enough having to pay at all let alone a double wammy next year!

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    Keep the money and invest it profitably until it needs to be paid.

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    Where will you get a worthwhile return over just 6 months ?

     
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    You could play ultra safe invest in Gov premium bonds 1.4% never know could get lucky then cash in for January

     
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    Put it into Premium Bonds for 6 months. Any winnings are a double bonus as they're tax free AND you're using money that would otherwise have gone to the taxman by 31 July.

     
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    Good luck to anybody who wants to ring HMRC they'll ask every conceivable question scrutinise your transactions and probably hound you until January!!

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    Agreed, better just to pay it as normal and not draw attention to your self where HMRC are concerned

     
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    Don't agree with you this time Andrew. Doing the same as millions of others is unlikely to get you noticed. You might even win £1 million, courtesy of the taxman by buying Premium Bonds.

     
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