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How to ease the pressure of January's self-assessment tax payment

How to ease the pressure of January's self-assessment tax payment

As the New Year begins, many professionals turn their thoughts to their personal aspirations and challenges ahead in the coming 12 months. As more than 10.5 million UK taxpayers will be acutely aware, they must soon prepare and complete their self-assessment tax submission to HMRC by Wednesday 31 January 2018.

Self-assessment payment methods - changes are imminent

Funding the due amount can be difficult for some, particularly as it comes on the coat-tail of the festive season when they may have faced additional spending.

This could be further exacerbated by a new directive which will see HMRC stop accepting credit payments, less than three weeks before the deadline for submitting and paying self-assessment tax returns.

In 2017, some 454,000 used personal credit cards to pay their tax and ease the financial pressures of paying on time.

 Many of these may not realise that HMRC is also withdrawing this facility together with those of digital payment services, such as PayPal and Apple Pay, from 13 January 2018.

This is due to a new EU directive, known as Payment Services Directive 2 regulations, which bans all organisations and companies from levying additional commission charges to process payments imposed by credit card companies.

HMRC is reported to pass on some £12m a year in commission payments to card issuers. 
Unless professionals want to join the 7% of taxpayers who miss the deadline and face a fine for late payment, now is the time to consider an alternative source of funding and spread the cost over time.

Tax funding the easy way

The Wesleyan Bank Tax Portal - www.taxfunder.co.uk - offers a more flexible solution. It can be accessed 24 hours a day, seven days a week, and guides the applicant through a simple application process in two minutes or less.

Repayment, at competitive rates, can also be spread over six or 12 months and once approved, funds can be paid directly to HMRC.

Using the portal can help prevent late filing and payment while also stopping the threat of at least a £100 fine being levied.

This fine is still in place for the tax year 2016/17 even though Chancellor Philip Hammond announce in November's Budget that a new points-based fine system is to be implemented. This is unlikely before 2020.  

It's not only late filing which can lead to a fine. Any mistakes on the return can mean a delay and potential penalty.

Common errors made include using incorrect figures; not declaring all income or Capital Gains; failing to claim all taxable business expenses and not submitting supporting evidence.

The important thing to remember is that fines are not limited to the initial £100. It can rise incrementally and could ultimately reach 100% of the tax due - so doubling the overall bill.

The Wesleyan Tax Portal allows costs over £500 to be spread across an agreed period of 6 or 12 months, helping to alleviate cash flow worries and ensuring potential financial penalties for late payment are avoided.

Find out more

To get an instant quote to spread the cost of your tax bill, visit www.taxfunder.co.uk. Alternatively, please contact the Wesleyan Bank team at commercialtax@wesleyan.co.uk or call 01606 338 001.

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Wesleyan Assurance Society and Wesleyan Bank Ltd are authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Wesleyan Financial Services Ltd, Wesleyan Unit Trust Managers Ltd, Practice Plan Ltd and DPAS Ltd are authorised and regulated by the Financial Conduct Authority.  Advice about investments, insurance and mortgages is provided by Wesleyan Financial Services Ltd.

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