HMRC Personal Credit Card Changes for Payment of Self-assessment Tax
At Harvey Telford & Bates Accountants, we understand that many clients use this method, and the issues it potentially creates for self-employed workers who wish to pay for self-assessment tax in this manner – with this in mind, please take a look at the guidance on self-assessment payments below.
How will the payment changes affect me?
If you can process and pay your self-assessment tax ahead of the 12th January, credit card payments from personal credit cards will still be permitted.
If you were intending to pay for your self-assessment tax with a personal credit card after 12th January, and cannot do it ahead of the deadline – you will have to consider the alternative methods of payment, ensuring you can make payment in full through that method.
Payments options from 13th January onwards will include:
Business credit card.
Many people who pay self-assessment tax such as sole traders and company directors may not have access to a business credit card. If this is the case, it is essential that the funds are paid through one of the alternative methods ahead of the payment deadline – Wednesday 31st January, to ensure you don’t incur late payment penalties.
Why are HMRC no longer accepting personal credit card payments?
The credit card payments changes have been made due to a new Government law which now prevents merchants (such as HMRC) from passing on credit card fees to payers, something which has traditionally been done.
Figures show that HMRC has charged £50 million in credit card fees over that past 5 years, charges that under the new rules would have to be absorbed, and paid for by taxpayers.
HMRC has deemed that this solution is not fair on other taxpayers, and is therefore advising on the wider range of payment methods available as it will no longer be available.
If you would like to know more about self-assessment, get assistance with your accounts or to get accountancy guidance, take a look at our self-assessment page here, or get in touch with our friendly team at our offices in Shrewsbury today.