Tag Archives: personal tax

Making Tax Digital: New Timetable

HMRC have announced significant changes to the timetable for the implementation of Making Tax Digital. We have previously written about HMRC‘s original plans for the implementation of Making Tax Digital, which would have come into effect from April 2018 for a number of businesses and landlords with gross income exceeding the VAT threshold (currently £85,000), and April 2019 for those below the threshold – however these timescales have now been relaxed.

Following HMRC’s newly reformed timetable, only VAT Registered businesses will be required to keep digital records from April 2019 – and only for VAT reporting purposes. The previous requirements for the reporting of other taxes quarterly to HMRC will not come into effect until at least 2020. This means businesses and landlords with turnovers below the VAT threshold will have at least 2 years before having to adopt a new digital system.

While the Government and HMRC are wholly supportive of MTD and the need to move to a more modern and streamlined system for the reporting of businesses tax affairs this is a significant slackening in the more imminent timescales that were previously expected. These changes have been well received by businesses and software providers alike who both recognise that more time is required to be able to make a comfortable transition to a new digital system of working.

 

 

Paying HMRC

A question we get asked quite regularly is “How do I pay HMRC?”, below is a summary of the key ways of paying HMRC for Corporation Tax, VAT and Personal Tax:

Corporation Tax

If your taxable profits are less than £1.5m HMRC will expect you to pay the Corporation Tax in one go, the deadline for this is 9 months and 1 day after the end of your accounting period. If the payment is late then HMRC will charge you interest based on the amount of Corporation Tax owed.

  • At the Post Office – For payments up to £10,000 you can pay at the Post Office by debit card, cash or cheque made payable to ‘Post Office Ltd’. You will need a payslip which HMRC will send to you after we have electronically submitted your Company Tax Return.
  • Online or telephone banking – There are two bank accounts you can use to pay your Corporation Tax to HMRC, the payslip which HMRC send you will detail which account to use, but if in doubt use Cumbernauld. As the reference, use your 17 character Corporation Tax reference which can be found from the payslip HMRC will send you.
Account Name Sort Code Account Number
HMRC Cumbernauld 083210 12001039
HMRC Shipley 083210 12001020
  • Online by Debit or Credit Card – You can pay directly to HMRC online using the following link. You will need your 17 character reference number which can be obtained from the payslip HMRC will send you. It is worth noting that HMRC will charge you 1.4% of the payment value if you pay by Credit card.

If your taxable profits exceed £1.5m HMRC will expect quarterly payments.

Value Added Tax – VAT

The deadline for paying your VAT is normally the same as the filing deadline, being 1 month and 7 days after the end of the VAT period. There are several ways to pay your VAT:

  • Direct Debit – The easiest way to pay your VAT is to set up a Direct Debit, once you have submitted a VAT return HMRC will automatically set up to take the payment owed, or if you are due a repayment this will be made directly into your bank.
  • Online or telephone banking – You can make your VAT payment using online banking or telephone banking using the account details just below. The reference you will need to include will be your 9 digit VAT registration number which can be found on your VAT registration certificate.
Account Name Sort Code Account Number
HMRC VAT 083200 11963155
  • Bank or Building society – You can pay at your local bank or building society, however you will need order paying-in slips from HMRC, these can take up to 6 weeks to arrive. Payment can be made using cash or a cheque made payable to ‘HM Revenue & Customs only’ followed by your 9 digit VAT registration number.

Personal Tax

Payments for personal tax are generally required to be made to HMRC twice a year. On 31 January you are required to pay the prior year’s tax (Balancing payment), and also the first payment on account for the year ahead. On 31 July you need to make your second payment on account.

  • At the Post Office – For payments up to £10,000 you can pay at the Post Office by debit card, cash or cheque made payable to ‘Post Office Ltd’. However, you will need to still be getting paper statements from HMRC and also have the paying-in slip which HMRC sent you.
  • Online or telephone banking – There are two bank accounts you can use to pay your personal tax to HMRC, your bill should tell you which account to use, but if in doubt use Cumbernauld. As the reference use your 11 character Unique Taxpayer Reference (UTR) followed by the letter “K” which can be found on your tax return or your HMRC online account.
Account Name Sort Code Account Number
HMRC Cumbernauld 083210 12001039
HMRC Shipley 083210 12001020
  • Online by Debit or Credit Card – You can pay using your credit or debit card using the following links. You will need your 11 character Unique Taxpayer Reference (UTR) followed by the letter “K” which can be found on your tax return or your HMRC online account.

Pay HMRC online via Debit Card

Pay HMRC online via Credit Card  – (Incurs 1.4% fee)

  • Post a cheque – You can post a cheque to HMRC, the cheque will need to be made payable to ‘HM Revenue & Customs only’ followed by your Unique Taxpayer Reference (UTR). You will need to send the cheque with a payslip, if you did not receive a payslip from HMRC you can create your own payslip online.

The cheque and payslip should not be folded or fastened together, they should then be sent to the following address:

HM Revenue & Customs
Bradford
DB98 1YY