Deferral for income tax self-assessment payments
The deferral for income tax self-assessment applies to the second payment on account for 2019/20 due on 31 July 2020 which is deferred until 31 January 2021. This is an automatic offer and no application is required.
Following some initial confusion HMRC has now confirmed that the deferral applies to all tax payers. It is not necessary to be self-employed to be eligible for the deferral.
The deferral is optional – some taxpayers may prefer to make the July payment to avoid a larger payment in January 2021.
Very few taxpayers pay their self-assessment liabilities by direct debit because the system requires a separate direct debit mandate to be set up for each individual payment. Any taxpayer that wishes to defer payment and has already set up a direct debit mandate for the payment on account due on 31 July 2020 should cancel it by contacting the bank.
Self-assessment returns should still be filed by their due date and it may be advantageous to file the 2019/20 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, including as a result of any loss relief available.