The HMRC has announced that Self Assessment customers can now apply online to spread the cost of their tax bill into monthly payments.
The online self-serve ‘Time to Pay’ service has been increased to £30,000 for Self Assessment customers to help ease any potential financial burden they may be experiencing due to the coronavirus pandemic.
Once completing your tax return for the 2019-20 tax year, customers can use the ‘Time to Pay’ service through the UK government website to set up a direct debit and pay any tax that is owed in monthly instalments, up to a 12-month period.
To set up a self-serve ‘Time to Pay’, customers must meet the following requirements: no outstanding tax returns; no other tax debts; no other HMRC payments set up; your Self Assessment tax bill is between £32 and £30,000; and it’s no more than 60 days since the tax was due for payment.
If you do not meet these requirements, you might still qualify for Time to Pay, but will need to contact the HMRC to set it up.
If you set up a ‘Time to Pay’ arrangement, you will have to pay interest on the tax paid late; interest will be applied to any outstanding balance from 1 February 2021.