Enhancements to Self-Assessment Could Help Self-Employed

6th November, 2020
By 6. November 2020COVID-19, Finance, News
Enhancements to Self-Assessment Could Help Self Employed

Following the Chancellor of the Exchequer’s announcement to increase support during the pandemic, self-employed workers have been given more time to pay their tax bills. Those who calculate their tax through the Self-Assessment will now have until January 2022 to make payments. HMRC has also increased the threshold for paying tax liabilities from £10,000 to £30,000 for Self-Assessment customers to help ease financial burden due to the coronavirus pandemic.

More than 11 million workers complete a Self-Assessment tax return each year. Once they have completed their tax return those who have payments to make have the option of using the online self-service Time to Pay facility through GOV.UK. The facility allows those who are eligible to set up a direct debit to pay any tax that is owed in monthly instalments, up to a 12-month period.

HMRC estimates around 95% of Self-Assessment customers who are due to make payments on 31 January 2021 could qualify to implement a Time to Pay arrangement using the online facility. Those who wish to set up their own Time to Pay arrangements must meet the following requirements:

  • no outstanding tax returns
  • no other tax debts
  • no other HMRC payment plans set up
  • the debt needs to be between £32 and £30,000

If you are completing a tax return for the first time, you will need to register for Self-Assessment. If your Self-Assessment debts are over £30,000, or you need longer than 12 months to pay your debt in full, you may still be able to set up a Time to Pay arrangement.

Despite the blow to business, some companies are still hiring, especially in the lead up to Christmas. For the latest news on hiring and vacancies, read our article here. If you’re starting a new contract, ContractingWISE has a range of hassle-free services that can help you set up a fast and efficient payroll. To talk to a member of our team, call: 0203 642 8679