Self Assessment individuals to benefit from enhanced payment plans

October 13, 2020

Self Assessment individuals to benefit from enhanced payment plans


Self Assessment individuals to benefit from enhanced payment plans

HMRC has increased the threshold for paying tax liabilities to £30,000 for Self Assessment individuals to help ease any potential financial burden they may be experiencing due to the coronavirus (COVID-19) pandemic.

The increased self-serve Time to Pay limit of £30,000 follows the Chancellor of the Exchequer’s announcement on 24 September 2020 to increase the support for businesses and individuals through the uncertain months ahead.

As part of his speech, the Chancellor announced that individuals could pay their deferred payment on account bill from July 2020, any outstanding tax owed for 2019 to 2020 and their first payment on account bill for this current tax year in monthly instalments, up to 12 months.

Financial Secretary to the Treasury, Jesse Norman, said “We are supporting jobs by giving more breathing space to up to 11 million Self Assessment taxpayers when managing their tax affairs.”

“Enhancing Time to Pay should ease the financial burdens and protect the livelihoods of these taxpayers, as they navigate the months ahead.”

More than 11 million people complete a Self Assessment tax return each year. This announcement means that once they have completed their tax return for the 2019 to 2020 tax year, those who have payments to make may now have the option to pay any tax that is owed in monthly instalments, for up to a 12-month period.

HMRC estimates around 95% of Self Assessment individuals who are due to make payments on 31 January 2021 could qualify.

Individuals who wish to set up their own self-serve Time to Pay arrangements must meet the following requirements:

  • they need to have no:
    • outstanding tax returns
    • other tax debts
    • other HMRC payment plans set up
  • the debt needs to be between £32 and £30,000
  • the payment plan needs to be set up no later than 60 days after the due date of a debt

Individuals using self-serve Time to Pay will be required to pay any interest on the tax owed. Interest will be applied to any outstanding balance from 1 February 2021.

If you’d like to know more about Time to Pay arrangements and how and if you are able to benefit from deferred payment plans, please contact your Barnes Roffe partner or give us a call/drop us an email.


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PLEASE NOTE: By the very nature of this type of information the details of tax law might have changed since they were published, so contact your Barnes Roffe partner before acting on any matter contained in these documents.