As part of the support package the Government is providing for those impacted by COVID-19, Income Tax Self-Assessment payments, due on the 31 July 2020 may now be deferred until 31 January 2021.
Who is eligible for deferring Income Tax payments?
If you are due to pay your second self-assessment payment on account on 31 July, you will be eligible for this scheme. Individuals do not need to be self-employed to be eligible. It is optional whether you take advantage of this scheme.
Accessing the scheme
No application is required, you simply would not make the payment on account on 31 July 2020. Additionally, no penalties or interest for late payment will be charged if this payment is deferred. The latest it can be deferred until is 31 January 2021.
Important information to consider
Whilst it may not be on the top of anyone’s list now, if an individual does decide to defer this payment (and it may make sense for this money to be in an individuals’ bank account, rather than an HMRC account) consideration should be given to what payment will be required in January 2021.
Whilst this may currently seem some time away, it will be important to keep an eye on cashflow and profit throughout the year, to ensure adequate monies are put aside to make this payment, when it does become due, by 31 January 2021.
Helping the self-employed during these difficult times
Here at Alexander & Co, our tax team provides a wide range of services to assist the self-employed and those other individuals that are required to submit a Self Assessment tax return.
We are also assisting a diverse range of businesses, who are impacted by COVID-19.
For further information on how we can assist, please get in touch by sending an email to email@example.com.