Coronavirus (COVID-19) update: self-assessment payment deferrals

Newsletter issue - June 2020.

To help ease the financial impact of the coronavirus (COVID-19), the Government has announced that self-employed taxpayers may be able to defer some tax payments without paying a penalty. At present it is possible to:

  • delay VAT payments due before 30 June 2020 until 31 March 2021;
  • delay self-assessment payments on account due in July 2020 until 31 January 2021.

Taxpayers have the option to defer their second payment on account for the 2019/20 tax year if they are registered in the UK for self-assessment and finding it difficult to make a second payment by 31 July 2020, due to the impact of coronavirus.

HMRC will not charge interest or penalties on any amount of the deferred payment on account, provided it is paid on or before 31 January 2021.

Taxpayers do not need to tell HMRC that they are deferring the payment on account, and choosing to defer will not prevent them from being entitled to other coronavirus support that HMRC provide, such as grants under the Self-Employment Income Support Scheme (SEISS).

The second payment on account must be made on or before 31 January 2021 if people choose to defer and there is concern around the tax and accountancy professions that deferment may have a knock-on 'snowball effect'. Whilst deferral will give an element of 'breathing space' in the short term, it may store up bigger problems in the future if liabilities continue to remain unpaid. HMRC confirm that the usual interest, penalties and debt collection procedures will apply to missed payments.

Taxpayers should note that other payments which may need to be paid by 31 January 2021 include any balancing payment due for the 2019/20 tax year, and first payment on account due for the 2020/21 tax year. For further information on payments, taxpayers can sign in to their HMRC online account.

What our clients say about us...

  • "Paul has provided accountancy services to my company for 2 years now. I can recommend Paul very highly; his skills as an accountant are highly detailed and professional and he is always available to provide advice. One aspect of the way Paul works that I greatly appreciate is a preference to meet face to face when there is a detailed conversation to be had. I personally find this more productive and is a benefit of working with a small accountancy firm that you wouldn't get with the large faceless providers."

    ALISTAIR FAIRWEATHER - PROGRAMME & PROJECT MANAGER, DELIVERING/RESCUING I.T. 7 BUSINESS CHANGE WITH BUDGETS UPTO £50M INC SUPPIER MANAGEMENT

  • "I couldn't ask for more from Paul as an Accountant. Paul has been accountant to Work Relief Charity Recruitment for just over a year now and is proving an invaluable asset. Accurate, knowledgeable, flexible with an emphasis on service delivery, I would recommend Paul's services to any organisation looking for an accounts professional."

    Neil Price - Managing Director at Work Relief Charity Recruitment

  • "Paul was a referral from a family member when I started my business 2 years ago. As this was the first time I had ever run my own company I was totally clueless over the financial side of matters and was worried that I may have made mistakes in any of my accounting. I needn't have worried as after enaging Paul for a set monthly fee he was always there on the end of the phone for all sorts of questions I had and no matter how trivial they were Paul gave me all the information I required and more and did an excellent and painless job at the end of my first year! Couldn't ask for any better to be honest. Just two words - hire him!!!"

    Lee Westrap MBCS - Director - Bulldog IT Services

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Booth & Co  |   The Hermitage  |   15a Shenfield Road  |   Brentwood  |   Essex  |   CM15 8AG        Telephone: 01277 224666    |   Email: info@boothandco.co.uk