Help to pay your tax next month

If you are having trouble paying your tax on time you may be eligible to receive support from HMRC by applying for an instalment payment plan. An online payment plan for Self-assessment tax bills can be used to set up arrangements for paying tax liabilities of up to £30,000.

The large majority of taxpayers, who are due to make payments on 31 January 2024, could qualify to implement a Time to Pay arrangement online.

Taxpayers that want to use the online option must have filed their latest tax return within 60 days of the payment deadline and intend to pay their debt within the following 12 months or less. Taxpayers that qualify for a Time to Pay arrangement using the self-serve Time to Pay facility online, can do so without speaking to an HMRC adviser.

Taxpayers with Self-assessment tax payments that do not meet the above requirements need to contact HMRC to formally request a Time To Pay arrangement. These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities.

HMRC will only offer taxpayers the option of extra time to pay if they think they genuinely cannot pay in full but will be able to pay in the future. If HMRC do not think that more time will help, they can require immediate payment of a tax bill and start enforcement action if no payment is forthcoming.

Obtaining the HMRC mobile app

HMRC’s free tax app is available to download from the App Store for iOS and from the Google Play Store for Android. The latest version of the app includes some updated functionality to update your name, save your National Insurance number to your digital wallet and to obtain help from HMRC's digital assistant.

The APP can be used to see:

  • your tax code and National Insurance number
  • your income and benefits
  • your income from work in the previous 5 years
  • how much you will receive in tax credits and when they will be paid
  • your Unique Taxpayer Reference (UTR) self-assessment
  • how much self-assessment tax you owe
  • your Child Benefit
  • your State Pension

The app can also be used to complete a number of tasks that usually require the user to be logged on to a computer. This includes:

  • get an estimate of the tax you need to pay;
  • make a self-assessment payment;
  • set a reminder to make a self-assessment payment;
  • report tax credits changes and complete your renewal;
  • access your Help to Save account;
  • using HMRC’s tax calculator to work out your take home pay after Income Tax and National Insurance deductions;
  • track forms and letters you have sent to HMRC;
  • claim a refund if you have paid too much tax;
  • update your name and / or postal address;
  • save your National Insurance number to your digital wallet; and
  • choose to be contacted by HMRC electronically, instead of by letter.

Why we all need to invest in tax planning

HM Revenue & Customs (HMRC have one clear objective, to recover past government expenditure and then recycle the cash collected to repay government borrowing and release funds for future expenditure.

To do this, HMRC are obliged to assess taxes by adopting the current legislation to collect taxes from individuals and businesses.

Fundamentally, HMRC base their judgement of the tax you owe on the data they have collected via tax returns, and all of these numbers relate to events in history. Whilst they will endeavour to allow the reliefs and allowances to which you are entitled, they do not have the data or the staff to call you up and ask about your future plans and how you can best organise your affairs to minimise overall tax liability.

For example, you may be a self-employed builder about to buy a replacement van in the last month of your accounting year. The cost of £20,000 could potentially be written off against your profits for the year and save you £4,000 in basic rate tax. But you know that in the following year you will be building a house that should net you profits in excess of £50,000. That being the case, it would make sense to defer the new van purchase until the following month, the first month of the new accounting period. Then, the £20,000 investment would save up to £8,000 in higher rate tax.

As we face the new calendar year there are just three months to the end of the 2023-24 tax year.

Which is why we are keen to have a conversation with all our clients to ensure your tax affairs are manged in the most efficient way; based not only on what has already happened, but more importantly, on what is planned to happen in the 2024-25 tax year.

In this way we can help you keep your tax footprint to a minimum.

Please call so we can determine how you would be best advised to organise your finances to minimise tax liabilities. The clock is ticking.

More delays contacting HMRC?

HMRC have announced that they will be focussing the use of its Self-Assessment helpline on priority queries from 11 December 2023 to 31 January 2024.

Taxpayers calling with queries that can be quickly and easily resolved online will be directed to HMRC’s online services from 11 December until the SA deadline on 31 January.

The department’s expert advisers will focus on answering priority SA queries – those that cannot be easily dealt with online – as well as supporting the small minority of taxpayers who require extra support or cannot engage with us digitally.

HMRC monitors all calls to identify people who may need extra help. These callers are passed on to HMRC’s Extra Support Team who are specially trained to deal with vulnerable taxpayers.

The vast majority of SA customers use HMRC’s online services, with more than 97% of taxpayers filing their SA returns online last year, and overall taxpayer satisfaction with these services is at more than 80%.

But around two-thirds of calls to the SA helpline can be resolved far quicker through HMRC’s online services. To make all SA callers aware of the department’s extensive online services, recorded messages supported by SMS texts will be used.

Examples of queries that can be resolved much quicker online include updating personal information, chasing on the progress of a SA registration, ending SA registration, and checking a Unique Taxpayer Reference number.

According to HMRC, they are:

“Transitioning to a digital-first approach, meaning taxpayers can get their queries answered 24/7, without having to wait on the phone or write a letter. It is continuing to improve and expand its online services, increasing their capabilities and ease of use so they become the default option. This includes the HMRC app, which is already used by more than a million people every month.”

In reality, you should not be surprised if your attempts at calling HMRC require prolonged waits or the navigation of confusing auto-select options.

Do you have a problem we could help you solve?

From time to time, we may spot issues when preparing accounts or tax returns that indicate problems that we subsequently help you solve.

But the problems we are going to identify in this way will relate back to past events, and these events may or may not be capable of an effective resolution due to the passage of time.

For example, if your business provides company cars and fuel for both private and business mileage, the car users will be paying tax for the use of the car and for the provision of fuel for private journeys. The car fuel taxable benefit is expensive, and, in many cases, it is worth crunching the numbers to see if this car fuel benefit can be avoided by the employee paying back the cost of any private fuel provided.

This payback process needs to be completed by the 6th of July following the end of the relevant tax year (usually, the 5 April). Miss the payback deadline and any opportunity to save employees from the tax charge will evaporate.

Or your business may start to experience a drop off in sales or increases in costs; profits may be falling and cash resources dwindling. Before you run out of cashflow – hit your overdraft limit – could you pick up the phone so we could brainstorm strategies to ease the situation?

As we approach the new year, make your “top of the list” resolution a promise to call us if you start to encounter business or personal financial issues causing you concerns.

The railways have a relevant exhortation, see it, report it, sort it. As soon as you become concerned, pick up the phone.

It is doubtful that all the political and economic challenges will resolve in 2024, but reacting swiftly to challenges as they occur is the best way to minimise any downside risks.

And we can help.

 

Called HMRC recently?

Call queues are becoming a unwelcome feature of communicating with HMRC. In a recent post on the GOV.UK newsfeed a new strategy is emerging. As you would expect, it steers taxpayers towards their online accounts or other information posted online by HMRC. We may be heading for a completely impersonal approach to handle communications between taxpayers and HMRC.

In their post, HMRC said:

“Nobody enjoys having to wait on hold on the phone just to resolve a simple query – and those completing Self-Assessment tax returns no longer need to, with more help and advice than ever before available online.

“But many people, unaware of the extent of online support now out there, are still calling instead, often with questions that could be answered via GOV.UK.

“Releasing details of the top 5 reasons people call the helpline, HM Revenue and Customs (HMRC) is encouraging everyone to check online when seeking help about their tax return, to get a much quicker and easier result.

“HMRC received more than 5.5 million calls to the Self-Assessment helpline last year, with 1.2 million calls in the 8 weeks leading up to the 31 January deadline. Around a third of these calls were routine or simple enquiries.

“The most common calls to the Self-Assessment helpline, which can be checked online are:

  1. Do I need to fill in a tax return?
  2. How do I fill in my online tax return?
  3. How do I check how much tax I owe?
  4. Where’s my Self-Assessment tax refund?
  5. What happens if I can’t pay my tax bill?

“Using HMRC’s online services means customers can access the information they need to resolve all of these questions quickly and easily – day or night – without the need to call HMRC.”

Let’s hope that this drive to push taxpayers towards online facilities does not disenfranchise those who have no access to the internet or who are not tech-savvy. But we may be transitioning towards a society where information – and solutions to problems – can only be solved by searching online data or by interacting with AI systems.

A reminder of imminent changes at Companies House

The Economic Crime and Corporate Transparency Bill (ECCT) achieved royal assent recently, and as we have reported previously, this will have an impact on the data that is held and required on the Companies House register.

Many of the changes – including the requirement to file profit and loss details – will require secondary legislation and may be some months away from implementation.

Other changes are more imminent. The following changes should be actioned Spring 2024, and we have summarised below some of these early reporting objectives that will apply to UK registered companies.

 

These early measures include:

 

  • Greater powers to query information

Companies House have confirmed that will be able to scrutinise and reject information that seems incorrect or inconsistent with information already on the register. In some cases, they will be able to remove information.

  • Stronger checks on company names

This is likely to mean that Individuals setting up new companies or wanting to change the name of an existing company, can expect a more rigorous vetting process.

  • New rules for registered office addresses

They will mean all companies must have an appropriate address at all times. Companies will not be able to use a PO Box as their registered office address.

  • A requirement for all companies to supply a registered email address

At present, you may, in certain circumstances, volunteer your email address when using Companies House online facilities. The new changes now include a requirement that you register an email address with Companies House.

  • A requirement for all companies to confirm they are forming the company for a lawful purpose when they incorporate.

Every year, companies will need to confirm that its future activities will be lawful on their confirmation statement.

  • Sharing data

Companies House will have more freedom to share your company data with other government departments and law enforcement agencies.

The ECCT bill, when fully implemented, will oblige all UK companies to be more transparent about the data they are obliged to share. We will post details as and when the fine print becomes available.

Pubs to open longer if UK nations reach Euros semis

In a potentially welcome announced for the hospitality industry in England and Wales, the government has set out plans to extend licensing hours for the semi-finals and final of the men’s European Football Championships next year, should England, Wales or Scotland reach the final stages of the tournament.

In a public consultation launched 27 November 2023, the government has proposed that pub licensing hours in England and Wales should be extended from 11pm to 1am if any of the UK nations remaining in the tournament reach the latter two rounds in Germany.

The Home Secretary has the power to extend licensing hours for occasions of “exceptional international, national or local significance”.

The plans, which will be subject to public consultation, would provide a welcome boost for the hospitality industry and clarity for pubs and bars. This is part of a series of recent government measures to boost the hospitality industry and make sure pubs and bars have the support they need to thrive, including the continuation of relaxed licensing regulations that allow pubs, restaurants and bars to sell takeaway pints without red tape holding them back.

Pub licensing hours were previously extended for the men’s Euro 2020 final, and pubs also stayed open longer for the King’s Coronation bank holiday weekend earlier this year.

The public consultation will run for 12 weeks with the government to consider the views from the public, licensing authorities and hospitality industry.

Hospitality venues that could benefit from this easing of licensing should start planning their “special EURO 2024 late night events”. The UEFA EURO 2024 fixtures can be viewed online at https://www.uefa.com.

Of course, to benefit from this licensing largesse in England and Wales – if it passes scrutiny – one or more of the UK nations actually have to qualify. Otherwise, supporters will need to drown their late night sorrows at home.

Winter support for pensioners

Pensioners across the country have started to receive up to £600 to help with energy bills this winter.

Winter Fuel Payments – boosted again this year by an additional £300 per household Pensioner Cost of Living payment – will land in bank accounts over the next two months, the vast majority automatically.

The money will appear in bank statements with the payment reference starting with the customer’s National Insurance number followed by ‘DWP WFP’ for people in Great Britain, or ‘DFC WFP’ for people in Northern Ireland.

The overwhelming majority of Winter Fuel Payments are paid automatically but some people need to make a claim, such as those who qualify but do not receive benefits or the State Pension and have never previously received a Winter Fuel Payment. The payments deliver additional support to pensioners, the majority of whom are on fixed incomes and also are unable to raise their incomes through fixed employment.

The start of the Winter Fuel Payments season comes hot on the heels of the recent £300 Cost of Living payments made by the DWP to more than seven million eligible households across the UK.

Pensioners receiving Pension Credit also qualify for this extra support. The average Pension Credit award is now worth £3,900 per year and there is still time for those who are eligible to apply and receive the £300 Cost of Living payment.

This is because an eligible claim for Pension Credit can be backdated by three months provided the entitlement conditions are met throughout that time.

Tax Diary December 2023/ January 2024

1 December 2023 – Due date for Corporation Tax payable for the year ended 28 February 2023.

19 December 2023 – PAYE and NIC deductions due for month ended 5 December 2023. (If you pay your tax electronically the due date is 22 December 2023).

19 December 2023 – Filing deadline for the CIS300 monthly return for the month ended 5 December 2023.

19 December 2023 – CIS tax deducted for the month ended 5 December 2023 is payable by today.

30 December 2023 – Deadline for filing 2022-23 self-assessment tax returns online to include a claim for under payments to be collected via tax code in 2024-25.

1 January 2024 – Due date for Corporation Tax due for the year ended 31 March 2023.

19 January 2024 – PAYE and NIC deductions due for month ended 5 January 2024. (If you pay your tax electronically the due date is 22 January 2024).

19 January 2024 – Filing deadline for the CIS300 monthly return for the month ended 5 January 2024.

19 January 2024 – CIS tax deducted for the month ended 5 January 2024 is payable by today.

31 January 2024 – Last day to file 2022-23 self-assessment tax returns online.

31 January 2024 – Balance of self-assessment tax owing for 2022-23 due to be settled on or before today unless you have elected to extend this deadline by formal agreement with HMRC. Also due is any first payment on account for 2023-24.