HMRC’s backlog of registrations means that some taxpayers will need to consider settling self assessment liabilities before their unique taxpayer reference is issued. ICAEW’s Tax Faculty explains how this can be done.
The Tax Faculty is pressing HMRC to deal with these applications and issue the unique taxpayer references (UTRs) that are needed to file self assessment returns. However, it seems likely that some UTRs will not be issued in time for taxpayers to file 2020/21 returns by 31 January 2022 and to pay any tax due on that date.
ICAEW members have been asking whether it is possible for taxpayers to make payment when a registration has not been processed and they are still waiting for a UTR.
It is possible to make a payment in this situation, against the national insurance number (NINO) rather than the UTR (so it is not a solution for taxpayers with no NINO). As explained in HMRC’s guidance, pay your self assessment tax bill: by cheque through the post, this involves generating a payslip and posting it with a cheque to HMRC.
It is not possible to pay at a bank or online without a UTR. It may be necessary to contact HMRC once the UTR has been issued to ensure that the payment has been correctly credited to the taxpayer’s self assessment account.
Late-filing penalties are not charged until at least three months from the date of the notice to file a return, so are not a concern where registration is delayed.
If the taxpayer has applied to be registered for self assessment by six months from the end of the tax year (ie, by 5 October 2021 for the 2020/21 tax year), that satisfies the notification requirement and failure-to-notify penalties will not be applied.
It may be important to make payment by 31 January 2022 to avoid interest charges and by 2 March 2022 to avoid a 5% late-payment penalty or where the 5 October deadline for notification of liability was missed.
This guidance is created by the Tax Faculty, recognised internationally as a leading authority and source of expertise on taxation. The Faculty is the voice of tax for ICAEW, responsible for all submissions to the tax authorities. Join the Faculty for expert guidance and support enabling you to provide the best advice on tax to your clients or business.