If you cannot pay your tax bill, then you may be able to make arrangement for HMRC tax payment plans. This will allow you to give yourself extra time to pay what you owe. It’s also a good way to settle any financial problems you have with your payments on accounts. However, it’s a good idea to think things through carefully first so you know what your’re getting yourself into. Here, I explain how to find out about payment plans and the way they work. In case you need to know, I also clarify how you arrange for more time to pay your tax bill.
** HMRC has announced an extension to the filing deadline for 2022 as COVID continues to cause disruption. Taxpayers now have until 28 February to file their tax return without facing penalties, although interest on any unpaid tax will apply from 1 February 2022 as normal.
Friendly Disclaimer: Whilst I am an accountant, I’m not your accountant. The information in this article is legally correct but it is for guidance and information purposes only. Everyone’s situation is different and unique so you’ll need to use your own best judgement when applying the advice that I give to your situation. If you are unsure or have a question be sure to contact a qualified professional because mistakes can result in penalties.
1. What is a Payment Plan?
A payment plan is also known as a ‘time to pay’ arrangement. It is a formal arrangement with HMRC to pay your outstanding tax in agreed instalments, in the event you cannot pay your self-assessment tax bill in full.
2. How to Arrange HMRC Tax Payment Plans
If you owe less than £30,000 in tax, you can arrange your time to pay online through your .GOV account. You’ll need to make sure you have filed your tax return, are within 60 days of the payment deadline and will repay what you owe in less than 12 months.
If you owe more then £30,000 or need more than 12 months to pay your debt, you’ll need to call HMRC to talk about a time to pay arrangement on 0300 200 3822.
While HMRC tax payment plans are not always easy to get, they can help you out of any financial woes. If you go through this process, it can help to identify why these debts came about and how future problems can be averted before they arise.
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- How to Reduce Your Tax Bill if You’re Self-Employed
Taxes are changing! From April 2024 sole traders will need to report their earnings and pay tax on a quarterly basis. This is known as Making Tax Digital, which you can read more about in this guide to help you get prepared.