Self-assessment taxpayers should submit their returns now and not wait until January, say leading tax and advisory firm, BlickRothenberg.
Fiona Fernie, a tax dispute and resolution partner at the firm said: “HMRC is issuing letters to those who submit self-assessment tax returns, reminding taxpayers that the final date for submission of those returns is 31 January 2021, now less than 3 months away. However, there are good reasons for completing them now, and certainly by the end of November. This will give taxpayers time to devise a strategy for meeting their tax debt.”
She added: “The deferral of the July 2020 payment on account means many people are facing a much higher bill in January 2021 than they would normally. Indeed, statistics show that the amounts of SA payments received by HMRC in July 2020 totalled £4.80 billion compared to £9.34 billion in July 2019, suggesting that a significant number of taxpayers took the opportunity to defer their payment on account.”
Fiona said: “It is therefore important that people know exactly what level of tax bill they now face and how they are going to meet them. If taxpayers submit their 2019/20 return before the December 2020 statements are issued by HMRC, these will show all payments due on 31 January 2021, and they will know exactly what payments they owe before the 31 January 2021 payment due date. These could include:
- deferred July 2020 payment on account (if it remains unpaid)
- any 2019 to 2020 balancing charge
- first 2020 to 2021 payment on account.