Tax evaluation for self-assessment – even when you have not submitted it but, pay as quickly as potential to keep away from curiosity revenue
Even if you didn't submit a return, appreciate what you owe and pay for it ASAP
Ideally, you should file a tax return as soon as possible because you know exactly how much tax you owe. However, since interest will be charged on outstanding payments starting February 1 and you will not be able to file it now, it is best to make an estimate of your current debt, pay it off immediately, and adjust it as needed once you have the final bill .
You may already have an estimate of how much you owe – for example because you had to make a late payment on account by July 31, 2020, or because you know you have nothing to pay. However, if you are unsure, according to the HMRC, you can use the self-assessment tax certificate to verify it. (The finished calculator currently says it's for tax year 2021/21 – we're double-checking that it can be used for 2019/20 as well and will update this story if we hear anything).
It's worth noting that HMRC assumes the self-employed assume that self-employed have no other taxable income and receive the customary personal allowance – they also don't take into account the billing payments you've already made. Also, remember that providing an estimate is a crude tool. So if your tax matters are complex or you think the number provided is wrong, always double check before making a payment.
Once you have an estimated amount for your debt, you can pay the normal way – online, through your bank, or by mail. HMRC accepts money under the Faster Payments system, which allows cash to be processed in two hours. However, the limit for this varies between £ 5,000 and £ 100,000 – see the limit of each provider. You can no longer pay your bill with a personal credit card or at the post office.
Are you having trouble paying? You can sign up for a repayment plan, but you must submit it first
Those who owe taxes between £ 32,000 and £ 30,000 can use HMRC's Enhanced Time to Pay mechanism to agree on a repayment schedule that allows that tax burden to be spread out over up to 12 months and paid back by direct debit, even if that is beyond the 31 payment deadline January 2021.
You do not need to be by the January 31 registration deadline to use the service, but you must have submitted a return before you can use it. If you're having issues with payment, submit a return ASAP and contact HMRC to sign a repayment plan. However, the repayment schedule must be created no later than April 1st and before March 3rd to avoid a 5% penalty for late payments.