A reminder of ways you can pay tax due

Last week we confirmed that as from 13 January 2018, HMRC will not accept personal credit cards for payment of tax or penalties. We have listed below the payment options you still have available to you:

  • Electronic payment. HMRC’s preferred method of payment is by electronic bank transfer using Faster Payments, CHAPS or BACS. In order to make a payment electronically you will need your 11-character payment reference when you pay. This reference is made up of your 10-digit Unique Taxpayer Reference (UTR) followed by the letter ‘K’. This should not be confused with your National Insurance number or other ID numbers as payments with the wrong reference number can be delayed. The correct number can be found on your HMRC online account. You can also pay by direct debit but you will need to make a separate payment each time to HMRC
  • Pay at your bank. This option is only possible if you still receive paper statements from HRMC and have the paying-in slip HMRC sent you. If you do you can pay by cash or cheque (including your reference number) at your bank or building society. HMRC will accept your payment on the date you make it, and not the date it reaches their account (as long as you pay from Monday to Friday).
  • Debit or credit card online. It is still possible to pay with a personal debit card online or to use a company credit card which must be linked to a business bank account. However, when it comes to making personal tax payments care should be taken where an employer pays a debt that an employee owes to a third party. 
  • Cheque payments. HMRC accepts cheques made payable to ‘HM Revenue and Customs only’ followed by your UTR number. You should allow 3 working days for your payment to reach HMRC.
  • Budget payment plan. There is also an option to set up a budget payment plan if you prefer to make regular payments in advance.
  • Post office. HMRC removed the option of making a payment through a Post Office on 15 December 2017.

Planning note

Taxpayers that make payments on account should be aware that the first payment on account for 2017-18 is due on 31 January 2018 together with any balancing payments due for 2016-17. There are penalties for late payment of tax due and we would strongly advise all our clients to ensure they meet these payment deadlines and leave sufficient time for the payment to reach HMRC by the close of play on 31 January 2018.

Posted in Income Tax

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