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25 October, 2019
Paying your Self-Assessment Tax bill is never enjoyable, and especially so if you just don’t have the cash readily available.
31 January is the date by which any arrears of tax for 2018-19 need to be settled, together with a payment on account for 2019-20, if one is due. Those who have completed their tax returns for 2018-19 should be aware what these liabilities amount to and any clients reading this article who are unsure what they should be paying, please call so that we can advise in good time.
If you have cash problems and are unable to pay the tax due on the 31 January, you can approach HMRC for extended terms, but you should try to do so before the tax becomes due. You will need to call:
Business Payment Support Service – 0300 200 3835, or
Self Assessment Payment Helpline – 0300 200 3822
Their opening hours are here and we would suggest you try to phone as early as you can in order to get through. And don’t forget, HMRC will charge interest on tax paid late and penalties so make your call before the 31st January 2020 to minimise these costs.
Generally spreading the payments over three months is relatively easy, though be prepared for them to suggest you pay by credit card straight away! If you persist you are likely to get three months to pay, though interest will be added and you will be required to set up a direct debit for the payments. If you need to spread the payments over a longer period HMRC will require a statement of assets before agreeing anything and you won’t get further without providing one.
Before you call be sure to estimate how much you can pay on account and you will normally need to clear any balance before any future payments on account become due (ordinarily this would be before 31 July 2020 when the second payment on account for 2019-20 falls due).
If you miss the payment deadline and receive a letter or bill threatening legal action, call the HMRC office that sent you the letter. Doing nothing is always the worst course of action!
And if you have already ignored their letters urging you on paying your self-assessment tax it helps to know your rights should bailiffs come to your personal address to claim payment. If you confidently refer them to your accountant then they will usually comply.
Let us know if we can help you navigate the process.
Blog post by: Ian Marlow