Income Tax: Self-Assessment second payment on account deferral

Posted on 26th March 2020 by Streets


Image to represent Income Tax: Self-Assessment second payment on account deferral

The deferral for income tax payable under Self-Assessment applies to those who are due to pay their second payment on account for 2019/2020 on 31 July 2020, which is deferred until 31 January 2021. You do not need to be self-employed to be eligible for the deferment.

This is an automatic offer and no application is required. Very few taxpayers pay their Self-Assessment liabilities by direct debit as the system requires a separate direct debit mandate to set up for each individual payment. Any taxpayer who qualifies for the deferral and has already set up a direct debit mandate for the payment on account due on 31 July 2020 should consider cancelling it.

Self-Assessment returns should still be filed by their due date and it may be advantageous to file the 2019/2020 return as soon as possible after 5 April 2020. This might facilitate planning for the tax payment due in January 2021 and perhaps crystallise any refund due, arising as a result of any loss relief claims which may be available.

No penalties or interest for late payment will be charged in the deferral period.

The deferment is optional. If you are still able to pay your second payment on account on 31 July 2020 you should do so. These are trying times for us all the government have introduced measures to help those within Self-Assessment by deferring payments on account for July 2020 until January 2021. However, this is a postponement of potential tax liabilities arising for the year ended 5 April 2020.

By deferring the payment, you will potentially have a larger tax payment to make in January 2021. Whilst we will aim to let you know the actual tax position as soon as we can we would encourage you to try and get your year-end books and records to us in a timely manner so that we can do this.


No Advice

The content produced and presented by Streets is for general guidance and informational purposes only. It should not be construed as legal, tax, investment, financial or other advice. Furthermore, it should not be considered a recommendation or an offer to sell, or a solicitation of any offer to buy any securities or other form of financial asset. The information provided by Streets is of a general nature and is not specific for any individual or entity. Appropriate and tailored advice or independent research should be obtained before making any such decisions. Streets does not accept any liability for any loss or damage which is incurred from you acting or not acting as a result of obtaining Streets' visual or audible content.

Information

The content used by Streets has been obtained from or is based on sources that we believe to be accurate and reliable. Although reasonable care has been taken in gathering the necessary information, we cannot guarantee the accuracy or completeness of any information we publish and we accept no liability for any errors or omissions in material. You should always seek specific advice prior to making any investment, legal or tax decisions.


Expert insight and news straight
to your inbox

Related Articles


Settling energy disputes

Business owners that are in dispute with their energy suppliers will be interested in the free support on offer from the Energy Ombudsman. In a recent press release the Department for Energy Security and Net Zero confirmed the


COVID Bounce Back abuse

The Insolvency Service has recently published information confirming that a total of 831 company directors were banned in 2023-24 for Covid support scheme abuse, up more than 80% on the previous year, and that the average length of director


VAT retail scheme

VAT retail schemes are a special set of schemes used by retail businesses to account for VAT. The schemes are used by businesses that sell a significant amount of low value and/or small quantity items to the public with different VAT liabilities. The use of the schemes can save ...


You might also be interested in...