How to Pay Self Assessment Tax Bill

Pay Self Assessment Tax Bill


Deadline for Paying Your Tax Bill

31st January 2019 is the last date for paying taxes to HMRC online for financial year 2017-18. Any tax payer who wants to pay the tax bill for financial year 2017-18 can pay the same online before 31st January 2019 to avoid fine, penalty, interest etc. Not paying the tax bill on time and missing the deadline of 31st January 2019 will lead to fines & penalties by HMRC.

Ways to Pay Self-Assessment Tax Bill

Make sure that you pay the owed taxes to HMRC online before payment deadline i.e. 31st January 2019. There are different ways by which you can pay your self-assessment tax. Every method of paying tax takes some time and it all depends upon the method you have selected for tax payment.

Same day or next day - If you want your tax to reach HMRC on the same day or next day, you have to follow these payment modes online for faster payments –

  1. By online or telephone banking
  2. By debit or corporate credit card online.
  3. CHAPS (Clearing house automated payment system)
  4. By Bank or building society (HMRC Paying-in slips required for paying tax at bank or building society)

3 Working days – In this case, payment modes usually takes around 3 working days in processing the payment. The following payment modes given below usually takes 3 working days –

  1. Direct debit
  2. By Cheque
  3. BACS (Direct bank transfer)

5 Working days – The most time taking mode to clear out a transaction is direct debit in case you have not set up your direct debit account with HMRC. The transaction usually takes around 5 days in processing the payment.

Pay Your Self Assessment Tax Bill

Pay Self-Assessment Tax Bill through Direct Debit

To make single tax payments for 31st January 2019, set up a direct debit account with HMRC online. In this process, the amount will be automatically deducted from the account. Every time you have to set up a single payment, if you want to pay by a direct debit option.

You have to use 11 character payment reference number to make the payment. 11 characters contains 10 digit unique taxpayer reference number followed by letter K. You can easily find the 11 character payment reference number in your HMRC online account or paying-in slip (displayed on paper statements). Your payment may get delayed, if you will use the wrong payment reference number.

If you have already set up the direct debit account with HMRC online, it may take around 3 working days to process your transaction but if you are setting it up for the first time, it may take 5 working days in processing your transaction.

Pay Self-Assessment Tax Bill through Bank Online, Telephone Banking, CHAPS or Bacs

You can make a bank transfer from your bank account by using modes of payment like CHAPS (Clearing house automated payment system) or BACS for faster payments.

Some peoples become confuse while paying the tax bill to HMRC that the amount will go into which account. Bill clearly explains that you have to pay your tax into which account but if you are not having a bill or you are not sure, you can use "HMRC Cumbernauld" account.

  1. If your account is in UK, use the following account details –

    Sort code Account number Account name
    083210 12001039 HMRC Cumbernauld
    083210 12001020 HMRC Shipley
  2. If your account is in overseas, use the following account details –

    Bank identifier code Account number Account name
    BARCGB22 GB62BARC20114770297690 HMRC Cumbernauld
    BARCGB22 GB03BARC20114783977692 HMRC Shipley

As same as direct debit method, you have to use 11 character payment reference number in this case too. Your payment may get delayed in case you use a wrong payment reference number.

How much time these payment mode takes?

  1. Payment by online or telephone banking usually reach HMRC on same day or next day including weekends & bank holidays.
  2. A payment done through CHAPS (Clearing house automated payment system) is also considered fast & usually reaches HMRC on the same or next day if you pay within your banks processing time.
  3. Payments done through BACS takes more time than other payment modes like online or telephone banking & CHAP - it usually takes 3 working days.
  4. Overseas payments may take longer time. In case your payment is very much delayed, kindly check with your bank.

In Case of Multiple Payments done by CHAPS (Clearing House Automated Payment System)

If you want to make single CHAPS payment for multiple self-assessment bills by using more than one payment reference number, send an online CHAPS enquiry form.

The banking address of HMRC is –

  • Barclays Bank PLC
  • 1 Churchill place
  • London
  • UK
  • E145HP

Pay Self-Assessment Tax Bill by Debit Card or Corporate Credit Card

There is one more method by which you can pay online i.e. corporate credit card. Corporate credit card contains a fee which is non-refundable. In this case, you can’t pay by personal credit card. In this case too, you have to use 11 character unique tax payment reference number followed by the letter “K” as your payment reference number.

HMRC accepts the payment on the date you make it rather than considering the date on which payment reaches their account. It includes bank holiday & weekends too.

If you are not able to do full payment through your card, you can use bank transfer as a method.

Pay Self-Assessment Tax Bill at your Bank or Building Society

You can pay tax bill at your bank branch by cash or cheque, if –

  1. You are having the paying –in slip sent by HMRC.
  2. You still get paper statements from HMRC.

In order to make payment by cheque, make your cheque in the name of “HM Revenue and customs only” followed by the UTR number followed by letter “K”. You will easily find this number on paying-in slip or HMRC online account.

Pay Self-Assessment Tax Bill by Cheque through the post

You can also send cheque by post to HMRC on the following address given below –

  • HMRC
  • Direct
  • BX5 5BD

There is no need to include street name, city name or PO Box with this address. It will take around 3 working days to reach HMRC.

What to include

In order to pay by cheque, make a cheque payable to “HM Revenue & customs only” followed by unique tax payer reference number (UTR). You will find the UTR number on your paying in-slip or in HMRC online account. Kindly do not fold the paying-in slip or cheque.

If you do not have a paying-in slip

If you are not having a paying-in slip with you, you can print a slip and use this by paying through post. You cannot use this at a bank.

Pay Self-Assessment Tax Bill through Budget Payment Plan

Many tax payers use budget payment plan to make regular payments in advance. In order to use budget payment plan, make sure that your previous self-assessment payments are updated. This payment plan helps you in –

  1. Deciding how much you have to pay each week or month
  2. Stop paying for up to 6 months.

By setting up your budget payment plan, go to direct debit section and select budget payment option while filling direct debit form.

If you cannot pay your Tax Bill on time

If you cannot pay tax bill on time, you should contact HMRC as soon as possible. You can set up a payment plan to pay HMRC in installments.

Before setting up a payment plan, you need a govt. gateway user ID & password. If you are not having a user –id, you can create it at the time of setting up a payment plan. If you are late in making tax payment, you may have to pay fines, penalties, interest etc. You may avoid penalties by contacting HMRC.

If you cannot pay your tax before the deadline, kindly call the business payment support service. The service is open for all peoples not just for businesses.

BUSINESS PAYMENT SUPPORT SERVICE

Telephone – 0300 200 3835

Monday to Friday – 8AM to 8PM

Saturday & Sunday – 8AM to 4PM

If You Have Missed Your Payment Date

If you have missed your payment date and received a tax bill or letter from HMRC threatening you with legal action. Call HMRC office immediately.

If you have not received any bill or letter about payment, contact business support service but if you missed your payment date, call Self-assessment helpline.

SELF-ASSESSMENT HELPLINE

Telephone – 03002003822

Monday to Friday – 8AM to 8PM

Saturday & Sunday – 8AM to 4PM

What Things You Must Know Before Contacting HMRC

  1. Your 11 character reference number (UTR number or VAT reference number)
  2. The tax bill which you are finding it difficult to pay and the reason
  3. What you have done to get the money to pay the tax liability?
  4. Your bank account details
  5. How much you can pay immediately & how much time you will take to pay the rest?

What HMRC Asks When You Contact Them

  1. Your income & expenditure
  2. You savings & investment
  3. What you are doing to get your tax payment back in order

HMRC decides that whether you are in a position to pay tax immediately or not. If not, more time given by HMRC to get you back on track. In complex cases, HMRC may ask for evidences too.

What Happens Next Over Phone

You have to pay immediately, if HMRC tells you over phone to pay the tax now. If you do not, HMRC may start “enforcement action” to get money from you. You can make the payment by direct debit, credit or debit card over the phone.

If you cannot pay the full tax bill, you may –

  1. Pay your bill in installments with the help of direct debit.
  2. Get more time from HMRC to pay tax bill

Making a Complaint

You cannot go against HMRC’s decision but you can make a complaint, if you think that you are not treated properly.

Pay Self-Assessment Tax Bill through your Tax Code

You can pay your self-assessment tax through your PAYE tax code as long as you are fulfilling the following conditions –

  • If the amount of tax you owed to HMRC is less than £3000.
  • If you are an employee or getting a company pension and already paying tax through PAYE.
  • You already submitted your paper tax return by 31st October or online tax return by 31st January.

How it’s set up

If you meet all the 3 conditions written above, HMRC will automatically collect the tax from you through your PAYE tax code unless you specifically ask them not to deduct it. If you are not eligible, you cannot pay by this method.

When you cannot pay through your tax code

You cannot pay through your tax code under the following conditions –

  1. If you income is below the minimum amount on which an individual is liable to pay tax.
  2. If you pay more than 50% of your PAYE income in tax.
  3. If you end up paying more than the double tax to HMRC than you normally do.

In case you are self-employed, you cannot pay class 2 national insurance through your tax code. You can pay only in case if it is due since before 6th April 2015. You can also use another ways to pay the tax before the deadline.

How deductions are made

The tax you owe will be taken in equal installments by HMRC from your salary or pension in the 12 months period along with your usual tax deductions.

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