Over eleven million self assessment taxpayers are able spread their tax bills into monthly payments by using an online service provided by HMRC.
The Chancellor announced in his Winter Economy Plan measures to allow taxpayers assessed via a tax return to defer their payment on account bill and settlement bill.
This can now be carried out using an online tool and allows the total payment to be spread into monthly payments for up to twelve months.
The self-serve Time to Pay tool allows people who have completed their 2019/2020 tax return (this covers the earning period of 6th April 2019 to 5th April 2020), to choose to pay the outstanding tax due via direct debit.
There are a few caveats, including:
- No outstanding tax returns, tax debts or other payment plans already running.
- Debts between £32 and £32,000 are allowed.
- Taxpayers can set up a plan up to sixty days after the due date of the debt.
There is interest charged on the payment plan and interest will start being charged from after January 31st 2021.
People who don't qualify for the Time to Pay arrangement can contact HMRC directly to seek assistance. The Self Assessment Payment Helpline can be reached on 0300 200 3822.