Many of our clients are receiving Self Assessment Statements advising them that the payment due on 31 July 2020 does not have to be made by the due date. As a COVID-19 measure, H M Revenue & Customs announced that they will not charge interest and penalties on non-payment of the payment due on 31 July 2020 – but it is not that simple.
Importantly, it should be noted that this is a deferment of the Self Assessment and not a cancellation of the charge. The payment must be made by 31 January 2021 at which point interest and penalties will start to be imposed. If you do not make the payment now and leave it until January, you will potentially have to make a large tax payment comprising:
- This deferred payment
- Any 2019/20 balancing payment (please bear in mind that Covid-19 is unlikely to affect your tax position for the year ended 5 April 2020)
- The first 2020/21 payment on account (adjusted as appropriate for any anticipated downturn in income and profits due to Covid-19).
Accordingly, we are recommending that clients do make the payment due on 31 July if they can.
If it is not possible then please contact us so that we can review your tax payments for July 2020 and January 2021 and make any appropriate claims; in this regard if we have not yet received your personal tax return information (originally requested in April 2020), please forward it to us ASAP so we can finalise your 2019/20 tax position.
Please do not hesitate to talk to your usual Robson Laidler contact if you have any queries about this matter; our switchboards are fully operational on 0191 281 8191 (Jesmond office) or 0191 388 3377 (Durham office).