<?xml encoding=”utf-8″ ?????????>
HMRC aren’t known for their Christmas spirit, but there is one area where some taxpayers can benefit from a little cashflow bonus if they act now.
Stefanie Tremain, from eading tax and advisory firm Blick Rothenberg, said: “Most people are aware that the normal filing deadline for a Self-Assessment tax return (and to make any payments due) is 31 January, which means 2022/23 tax returns and tax payments are due by 31 January 2024.
“What is less well known is that if your tax liability is less than £3,000 and you have a source of PAYE income (e.g., employment or private pension income), and your tax return is filed by 30 December, your tax can be collected through your PAYE code in the following tax year.”
She added: “For example, if you owed tax of £2,500 for 2022/23, you would either need to pay this in full by 31 January 2024, or HMRC could take a deduction from your pay in 12 instalments, starting in April 2024. This can be a huge boost to cashflow at what is already an expensive time of year.”
Stefanie said: “Taxpayers need to make sure that they have enough PAYE income in the relevant year to collect the additional tax, and make sure they would not end up paying more than half of their income in tax.”
She added: “For any taxpayers filing their own tax returns who would like to take advantage of this, HMRC should do this automatically when they process your return, provided you leave the relevant box unticked.”
She added: “It’s also important that taxpayers remember whether any tax was collected through their PAYE code when they file their tax return for the relevant year in the future (e.g., for 2024/25, in this example) as you they otherwise mistakenly think they are due a refund!”