Taxation: Self-assessment

(asked on 30th December 2020) - View Source

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what estimate he has made of the number of taxpayers who will be unable to meet the deadline of 31 January 2021 for payment of tax for the tax year 2019-20 as a result of the effect of the covid-19 outbreak on the income levels of self-assessment taxpayers.


Answered by
Jesse Norman Portrait
Jesse Norman
This question was answered on 11th January 2021

The Government recognises that because of the exceptional circumstances posed by COVID-19, some taxpayers will have difficulty paying their 2019/20 Self-Assessment (SA) liabilities on time.

For that reason, the Chancellor announced in March 2020 that SA taxpayers could defer paying their July 2020 Payment on Account until 31 January 2021. This provided an immediate financial easement to about 1.5 million taxpayers who took up the option and deferred a total of about £5.8 billion.

The Government understands that many taxpayers will still struggle to pay their SA payments becoming due on 31 January 2021. Although it is not possible accurately to estimate the number of taxpayers who will be affected in this way, the numbers may be considerably higher than in previous years.

Therefore, in order to support taxpayers facing financial difficulty, HMRC have made significant changes to their online self-service Time to Pay Service, enabling taxpayers to set up a Direct Debit instalment payment arrangement with HMRC without having to contact HMRC beforehand.

Previously, this service was only available to taxpayers with Self-Assessment liabilities of up to £10,000. That threshold has been increased to £30,000 to enable more taxpayers to use the service, allowing payment in up to 12 monthly instalments.

Taxpayers with Self-Assessment liabilities over £30,000 will still be able to contact HMRC directly to agree a Time to Pay arrangement.

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