Spreading tax payments across the year
The Finance Bill 2009 includes a draft clause (clause 110) on managed payment plans to allow taxpayers more control over when payments are made to HMRC. HMRC have issued draft guidance providing more detail as to how the new legislation is likely to put into effect once the Bill becomes law.
The idea of managed payment plans follows consultations with income taxpayers and small businesses. The payment plans would allow taxpayers the opportunity to pay income tax and corporation tax via up to 12 monthly instalments. The instalments would be evenly spread before and after the regular due date(s) for the payment.
The voluntary plans will be open to all taxpayers who complete self assessment income tax returns and to corporation tax self assessment (CTSA) taxpayers which are not part of a group or making quarterly payments.
Once the relevant legislation is in place taxpayers will need to contact HMRC to apply to make a payment plan and to agree to make payments by direct debit.