Friday, 26 March 2021

Pay 2019/20 Self-Assessment Tax Before 1 April 2021 To Avoid 5% Surcharge Penalty

Last month HMRC announced that self-assessment taxpayers won’t be charged the March 5% late payment penalty if they pay their 2019/20 income tax, CGT, class 2 and 4 NIC liabilities or set up a payment plan by the 1st April 2021.

Note that if the balance is still unpaid at midnight on 1st April 2021, a 5% surcharge penalty is added in addition to the normal interest charge unless a payment plan has been agreed.

Because of COVID-19, Self-Assessment tax payers can now apply online to HMRC to spread the cost of their tax bill into monthly payments without the need to call them.

The online self-serve 'Time to Pay' service is designed to help ease any potential financial burden tax-payers may be experiencing due to the coronavirus pandemic.

If you would like to spread your tax payment, you can use the online self-serve 'Time to Pay' service through www.gov.uk to set up a direct debit and pay the tax that is owed in monthly instalments, up to a 12-month period.

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.

If you need any assistance doing this please do not hesitate to contact us, we will be pleased to assist.

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