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Enhanced Time To Pay Arrangements

HMRC announced an Enhanced Time to Pay arrangement for any individual Self Assessment taxpayer with a tax liability of up to £30,000, an increase from £10,000. They will be able to set up a payment plan to allow the tax liability to be paid in monthly installments for up to twelve months which can also include any outstanding tax from 2019/20 along with the deferred payment on account bill from July 2020.

HMRC have set out the following requirements that taxpayers must meet to be eligible to set up a time to pay arrangement:

  • Must have no outstanding tax returns
  • No other tax debts
  • No other HMRC payment plans in place
  • The debt needs to be between £32 and £30,000
  • Payment plan must be set up no later than 60 days after the due date of the debt

If you meet the criteria, you can set up a payment plan online. You can read more and set this up here. If you do not meet the above criteria or you need longer than a twelve month period to settle the debt, this is still possible, however, you will be required to call HMRC and discuss this with an advisor.

Unlike with the deferment of the July 2020 payment to account, any Self Assessment taxpayer wishing to utilise a time to pay arrangement for a 31 January 2021 tax liability, will be charged interest from 1 February 2021 for any liability outstanding, until the debt is fully paid.

If you require any further assistance to clarify what support you are eligible for, please speak to your usual advisor or contact one of our Private Client Taxperts.

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