Coronavirus has had a big impact on businesses and individuals up and down the country. Self-employed people have particularly felt the strain as the Self-Employment Income Support Scheme (SEISS) only went live last week.

With the first payments set to hit people’s accounts later this week, there’s more good news for the self-employed as HMRC has said they can defer their second payment on account for the 2019 to 2020 tax year.

This payment would normally be due on 31 July 2020 but you now have until 31 January 2021 to make the payment.


Am I eligible?

You have the option to defer your second payment on account if you’re:

  • Registered in the UK for Self-Assessment.
  • Finding it difficult to make your second payment on account by 31 July 2020 due to the impact of Coronavirus.


What if I want to make the payment as normal?

You can still make the payment by 31 July 2020 as normal if you’re able to do so.


Will I be charged interest?

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


Making a payment

If you want to pay in full

You can pay your second payment on account in full any time between 31 July 2020 and 31 January 2021 using the online service.

If you want to pay in instalments

You need to contact HMRC if you already have overdue tax which you’re paying through a Time to Pay instalment arrangement and want to include your second payment on account in that arrangement.

If you don’t have other overdue taxes, you can make your payment in instalments any time between now and 31 January 2021 by setting up a budget payment plan.


Payments made by Direct Debit

If you choose to defer and normally make your payments on account by Direct Debit, you should cancel your Direct Debit through your bank as soon as possible so that HMRC will not automatically collect any payment due. You can cancel online if you’re registered for online banking.


After the deferral ends

The usual interest, penalties and collection procedures will apply to missed payments.

If you’re still struggling to pay your tax bill by 31 January 2021, or you’re experiencing other financial difficulties you can contact HMRC’s Time to Pay service on 0300 200 3835. More information about deferring your second payment on account can be found on the website.

If you have any questions or concerns about meeting your tax obligations during Coronavirus, please don’t hesitate to get in touch and we’ll be happy to help.

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