HMRC have said that they believe 1.1m self-assessment tax returns were not filed by the 31 January 2024 deadline. Some of these may have been due to fears over being able to pay the tax liability, but the guidance would always be to file on time and if required you may be able to request a Self Assessment Time to Pay Arrangement with HMRC. In this blog post we take a look at what a Time to Pay arrangement with HMRC is.
What is a Self Assessment Time to Pay Arrangement?
This is a payment plan that you agree with HMRC in order to spread your tax liability shown on your self assessment tax return(s) over a period of time, usually through agreed monthly payments.
Will I qualify for a Self Assessment Time to Pay Arrangement?
HMRC have the discretion to offer this to anyone with a liability, but those who meet the following criteria can make an application online:
- Have filed your latest tax return
- Owe £30,000 of less
- Are within 60 days of the payment deadline
- Do not have any other payment plans or debts with HMRC
If you meet these criteria and wish to setup a plan online you should log in to your HMRC Gateway by the below link:
If you do not meet one or more of the above criteria it is best to call HMRC on 0300 200 3822. HMRC will enquire about your current income and expenditure position so it is best to have a look at this yourself before contacting them and even pull together a proposal yourself. You may be keen to get the liability settled as soon as possible but it is important to make sure the plan is realistic and manageable.
Will I be charged interest by HMRC?
The likelihood is, yes. The standard rate for HMRC on late payments is 2.5% over Bank of England base rate so at the time of writing this would be 7.75%.
What if I did not file my tax return on time?
If you did not file your self-assessment by 31 January then you will incur a £100 penalty and this is the case when your tax return is up to 3 months late. If you file your return between 3 and 6 months late you will incur a £10 a day penalty, and the higher of £300 or 5% if the tax due if it is between 6 and 12 months late.
The main thing is if you did not file your return by 31 January then look to submit it as soon as possible. If you need any assistance with completing your return then we at Veritons are very happy to help. Click on the button below and fill in your details and we will be in touch very soon: