An essential part of your tax return service is telling our clients how much tax they have to pay and by what deadlines. This year we will also advise clients to consider how they plan to pay their tax bill, for instance by; cheque, credit/debit card, or electronic transfer.
Taxpayers who normally pay their tax liabilities due on 31 January by personal credit card, will need to pay before 13 January 2018, as HMRC won’t accept payments by personal credit card after that date. Payments by corporate credit cards will continue to be accepted.
This change is required to comply with the EU Payment Services Directive 2, which comes into effect on 13 January 2018. This Directive prohibits all organisations who accept credit card payments, including HMRC, from recharging the associated fees back to their customers, or in this case – taxpayers. There are fees for paying by credit card which vary considerably according to the type of card used (see link to schedule).
Some taxpayers prefer to pay their tax by cheque, either by sending a cheque in the post with an appropriate payslip to HMRC, or by paying at a Post Office counter with a pre-printed payslip from HMRC.
The Post Office counter service is being withdrawn from 15 December 2017. This will particularly affect small companies who pay their corporation tax in this way, as HMRC’s official position has been not to accept cheques in the post for corporation tax, although cheques that arrive are usually cashed.
Taxpayers will still be able to pay their tax liabilities at a bank or building society branch by cash or cheque, but they need the HMRC printed payslip to do this. The facility to print a payslip still exists on HMRC archived pages, but this DIY payslip can only be used for cheque payments sent by post, not those made by at the bank counter.
For further details please contact DFC Accountants in Cardiff, Wales.