Coronavirus: delaying your tax payments

The dedicated HMRC helpline for businesses and Self-Assessment Tax Payers who have difficulty with paying their tax due to COVID-19, which was promised at the Budget 2020, is now in operation. HMRC’s latest guidance states that “these arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities”.

Automatic deferrals

VAT payments and Income Tax Payments have been deferred for all UK businesses and Self-Assessment Tax Payers automatically. No applications are required and no penalties or interest on late payments will apply. Further details can be found in our Deferring VAT and Income Tax article.

Setting up a Time to Pay arrangement

If you are concerned that you will be unable to pay your tax due to COVID-19 and need further help, you'll need to call HMRC’s dedicated helpline on 0800 024 1222 (open 8am-4pm, Monday-Friday) as soon as possible.

The helpline can assist with:

• Setting up a time to pay arrangement;
• Suspending debt collection proceedings;
• Cancelling late payment penalties and interest.

What to do if you can’t get through

Despite being manned by more than 2000 advisors, we have become aware that the HMRC helpline is often jammed, with some clients reporting that they’ve waited for more than an hour without getting through.

If you are unable to get through, we suggest that you write a letter to the relevant HMRC department, depending on what tax is due. We will be providing clients with a template letter shortly, so do get in touch if you’d like a copy.

Should any dispute arise over penalties/interest in the future, at least a letter will provide evidence to HMRC that you tried to contact them regarding Time to Pay.

Subject to the above points, if you are concerned that paying HMRC would affect your ability to stay trading over the next 3 months, we recommend that you should withhold any PAYE/NI or Corporation Tax payments due . You must, however, continue to call or write to HMRC to get an agreement for Time to Pay.

We hope that HMRC will put in additional resources to improve access over the coming days.

Source: Institute of Chartered Accountants in England and Wales Tax Faculty announcement 17.3.20 following the similar announcement by the Chancellor on 11 March 2020.

Please note that this is only a summary of the main issues and should not be construed as advice. Every effort has been made to ensure factual accuracy at the time of publication (22 April 2020), however, the government response to the Coronavirus situation is changing 24-7, so it should not be relied upon completely.

For further information or advice on any of the issues raised, or for help with services like bookkeeping, cash flow management or payroll during the Coronavirus pandemic, please call us on 01225 325580, email, or contact your usual client director.