If you are registered in the UK for Self Assessment and due to the impact of coronavirus you are finding it difficult to make your second payment on account in respect of the tax year ended 5 April 2020, which is due by 31 July 2020, then HMRC should allow you to defer some or all of your payment until no later than 31 January 2021.

To defer your payment you do not need the consent of, or to inform, HMRC and you should not be charged interest or penalties. Beyond the deferral period normal interest and penalties are likely to be levied.

In order to correctly understand and plan your tax liabilities it is recommended that your 2020 tax return is prepared and submitted as early as possible.  In January 2021 you will need to pay:-

  • Any second payment on account in respect of the year ended 5 April 2020 which has been deferred and is unpaid; plus
  • Any balancing payment in respect of the year ended 5 April 2020; plus
  • Your first on account payment in respect of the year to 5 April 2021.

If, as a result of the above bunching of liabilities, it is the case that you need to agree a “Time to Pay” arrangement with HMRC, then this is something that HMRC may consider at that time if you are up to date with your filings i.e. if your 2020 tax return has been filed.

Should you require any assistance with the preparation of you UK self assessment tax return, please contact us.

The information in this article is believed to be factually correct at the time of writing and publication, but is not intended to constitute advice.  No liability is accepted for any loss howsoever arising as a result of the contents of this article. Specific advice should be sought before entering into, or refraining from entering into any transaction.