Tag: HM Revenue & Customs

One week to go until Self Assessment payment on account deadline

Millions of Self Assessment customers are expected to make a ‘payment on account’ to HM Revenue and Customs (HMRC) by the 31 July deadline in a bid to spread the cost of their tax bill for the 2023 to 2024 tax year.

More than 12 million people need to file a Self Assessment return for the 2023 to 2024 tax year and pay any tax owed before 31 January 2025.

However, to help spread out payments throughout the year, many people have to pay their tax by making 2 payments on account. If the previous year’s tax bill was over £1000, each payment is half that amount with the first payment having been made on 31 January and the second one due on 31 July.

If there is still tax to pay after customers have made their payments on account, they will need to make a ‘balancing payment’ by 31 January 2025.

Payments can be made securely via the HMRC app at any time of day or night.

Those who have yet to file their tax return for the 2023 to 2024 tax year, can do it early so they know what they owe and can decide how best to make the payment in full by the deadline.

Filing early also means that if a tax refund is due, they can receive it sooner.

There are a range of payment options, including weekly and monthly payment plans, available on GOV.UK. Customers can set up a plan before they have filed their tax return and the payments will be used against their next tax bill.

Those who are new to Self Assessment will need to register to get their Unique Taxpayer Reference before they can file their tax return. Anyone who is unsure about whether they need to file a tax return can use the online checking tool on GOV.UK.                                                                                          

Visit GOV.UK to find out more about Self Assessment and how to file a tax return.

Visit GOV.UK to download the HMRC app

HMRC has updated guidance on filing tax returns early and help around paying tax bills on GOV.UK.

Online help and support is available for customers who need support in completing their Self Assessment tax return.

HMRC: A record 11.5 million tax returns filed by the deadline

A record-breaking 11.5 million taxpayers submitted their Self Assessment tax returns for the 2022 to 2023 tax year by midnight on 31 January, HM Revenue and Customs (HMRC) reveals.

More than 12.1 million taxpayers were expected to file a tax return and pay any tax owed. Of those that met their obligations by the deadline, 778,068 beat the clock to complete it on 31 January, including:

·         61,549 customers who filed between 16:00 and 16:59 – the peak hour for filing

·         32,958 customers who filed between 23:00 and 23:59

HMRC is urging anyone who missed the deadline to submit their tax return now. There is an interactive tool on GOV.UK to help customers with their return. Late filing and late payment penalties are charged for failure to meet the deadline.

Myrtle Lloyd, HMRC’s Director General for Customer Services, said: “Thank you to the millions of Self Assessment customers and agents who met the deadline.

“Anyone who has yet to file and is concerned that they cannot pay in full may be able to spread the cost of what they owe with a payment plan. Search ‘pay your Self Assessment’ on GOV.UK to find out more.” 

The Self Assessment payment deadline was also 31 January, and anyone with outstanding tax to pay should do so as soon as possible.

There are many ways to pay, including online, using the HMRC app, by bank transfer, or setting up a Time to Pay payment plan. There is a video on YouTube to help customers set up an online payment plan.

A full list of payment options can be found on GOV.UK. There is also a video on YouTube that explains a customer’s Self Assessment tax bill and the different ways to pay.

Customers can plan ahead for their 2023 to 2024 tax bill and set up a regular payment plan to help spread the cost. HMRC’s Budget Payment Plan enables those who are up to date with previous payments to make regular weekly or monthly contributions towards their next tax bill.

A Budget Payment Plan is different from payments on account, which are usually due by midnight on 31 January and 31 July. 

Taxpayers who file or pay late but have a reasonable excuse can appeal penalties on GOV.UK. HMRC has published interactive guidance to explain the process and signpost them to the correct course of action.

People should be aware of the risk of falling victim to scams and should never share their HMRC login details with anyone, including a tax agent, if they have one. HMRC scams advice is available on GOV.UK.

Deadline for voluntary National Insurance contributions extended to April 2025

Taxpayers now have until 5 April 2025 to fill gaps in their National Insurance record from April 2006 that may increase their State Pension – an extension of nearly two years – the UK Government has announced.

Extending the voluntary National Insurance contributions deadline until 2025 means that people have more time to properly consider whether paying voluntary contributions is right for them and ensures no-one need miss out on the possibility of boosting their State Pension entitlements.

The original deadline was extended to 31 July 2023 earlier this year, and tens of thousands of people have taken advantage to pay voluntary contributions to HM Revenue and Customs (HMRC) since then. The revised deadline is expected to enable tens of thousands more to do the same.

Victoria Atkins, Financial Secretary to the Treasury, said: “People who have worked hard all their lives deserve to receive their State Pension entitlement, and filling gaps in National Insurance records can make a real difference.

“With the deadline extended, there is no immediate rush for people to complete gaps in their record and they will have more time to spread the cost.”

Laura Trott, Minister for Pensions, Department for Work and Pensions, said: “I am pleased to see so many people taking steps to review their State Pension, which is why we have extended the deadline for customers to add extra years to their National Insurance record.

“This extension means thousands more people will have time to check their entitlement, and in many cases, increase the amount they receive when they retire.”

The extension means that taxpayers have a longer period to enable them to afford to fill any gaps if they choose to do so. All relevant voluntary National Insurance contributions payments will be accepted at the rates applicable in 2022 to 2023 until 5 April 2025.

Individuals who are planning for their retirement could benefit from the opportunity to complete gaps in their National Insurance record. Other people who may benefit include those who may have been:

·         employed but with low earnings

·         unemployed and not claiming benefits

·         self-employed who did not pay contributions because of small profits

·         living or working outside of the UK

Paying voluntary contributions does not always increase your State Pension. Before starting the process, eligible individuals with gaps in their National Insurance record from April 2006 onwards should check whether they would benefit from filling those gaps.

They can find out how to check their National Insurance record, obtain a State Pension forecast, decide if making a voluntary National Insurance contribution is worthwhile for them and their pension, and how to make a payment on GOV.UK.

Taxpayers can check their National Insurance record through their Personal Tax Account.

Post Office card accounts: switch now, says HMRC

HM Revenue and Customs (HMRC) is warning Post Office card account holders, who receive HMRC-related payments, that time is running out – with just two weeks left to switch their accounts.

About 6,800 Post Office card account customers, who receive tax credits, Child Benefit or Guardian’s Allowance payments, need to transfer their account by 5 April 2022 to continue receiving their money without interruption.

HMRC is stopping making payments to Post Office card accounts from 6 April. Customers, who have not done so already, must notify HMRC of an alternative account to have their payments paid into. It will not be possible to pay tax credits or Child Benefit until a valid account is provided.

These could be vital funds for families and individuals, due to the rise in the cost of living, and HMRC wants to make sure no-one loses out.

Myrtle Lloyd, HMRC’s Director General for Customer Services said: “Time is running out and we want to make sure that no customer misses out on the benefit payments they are entitled to. If you still need to switch your Post Office card account, contact HMRC to update your bank account details.”

HMRC has been writing to affected customers since October 2019 to notify them that their Post Office card accounts will be closing and urging them to take action. More than 143,000 customers have already switched their accounts and provided HMRC with updated details.

Customers can choose to receive their benefit payments to a bank, building society or credit union account. If they already have an alternative account, they can contact HMRC now to update their details.

Child Benefit and Guardian’s Allowance customers can use their Personal Tax Account to provide revised account details, change their bank account details via GOV.UK or by contacting the Child Benefit helpline on 0300 200 3100.

Tax credits customers can change their bank account details by contacting the tax credits helpline on 0345 300 3900. If customers cannot open a bank account, they should contact HMRC.

If a customer misses the 5 April deadline, their payments will be paused until the customer notifies HMRC of their new account details.

The Money Helper website, provided by the Money Advice and Pensions Service, offers information and advice about how to choose the right current account and how to open an account.

All you need is … Marriage Allowance!

Married couples and people in civil partnerships could receive extra cash this Valentine’s Day as HM Revenue and Customs (HMRC) encourages those eligible to sign up for Marriage Allowance to reduce their tax bill.

Marriage Allowance allows married couples or those in civil partnerships to share their personal tax allowances if one partner earns an income under their Personal Allowance threshold of £12,570, and the other is a starter, basic or intermediate rate taxpayer. 

Eligible couples can transfer 10% of their tax-free allowance to their partner, which is £1,260 in 2021/22. It means couples can reduce the tax they pay by up to £252 a year. Couples can apply any time, backdate their claims for any of the four previous tax years and receive a payment of up to £1,220 at a time when they need it most.

Marriage Allowance is one of the ways the government is helping couples to receive extra money back in their pocket each month. The financial support could help couples where they need it most, including household bills.

Angela MacDonald, HMRC’s Deputy Chief Executive and Second Permanent Secretary, said: “Couples could be sitting on a tax relief worth up to £1,220 that could provide vital financial support at a time they need it most. To find out if you are eligible and how to apply search ‘Marriage Allowance’ on GOV.UK.”

More than two million couples have applied for the tax relief since it was launched in 2015 but there could be thousands more who are eligible to claim.

Marriage Allowance is free to apply for, and customers who claim directly via HMRC’s online portal will receive 100% of the tax relief they are eligible for. Visit GOV.UK to find out how to apply for Marriage Allowance.

Married couples may have experienced a change in their circumstances which could now mean they are eligible for Marriage Allowance, including:

·         a recent marriage or civil partnership

·         one partner has retired and the other remains working

·         a change in employment due to COVID-19

·         a reduction in working hours which means their earnings fall below their Personal Allowance

·         unpaid leave or a career break, or

·         one partner is studying or in education and not earning above their Personal Allowance

If a spouse or civil partner has died since 5 April 2017, the surviving person can still claim by contacting the Income Tax helpline.

Marriage Allowance claims are automatically renewed every year. However, couples should notify HMRC if their circumstances change.Marriage Allowance is 10% of an individual’s tax-free personal allowance.

The maximum amount that can be transferred to their husband, wife or civil partner is dependent on the Personal Allowance for that tax year:

Tax YearMarriage Allowance amount
2021/22£252
2020/21£250
2019/20£250
2018/19£238
2017/18£230