Each year, almost half a million people spread the cost of their annual tax bill over several months by paying it on a credit card. But from 13 January, just 2 weeks before this year’s self-assessment tax return deadline – HMRC will now decline all personal credit card payments
This is because new EU rules now make it illegal for HMRC to pass on the 1.5% ‘processing fees’ from credit card payments which banks charge on these transactions. And the new ruling doesn’t just apply to HMRC, but also to all businesses.
There was some discussion on whether HMRC would cover the 1.5% cost itself, but this won’t now happen and many people will be taken by surprise at the speed of this decision. HMRC have sent out written warnings with annual tax bills recently, but the very short notice and timing of the ban is likely to cause those aiming to complete their tax return by the 31 January deadline many problems – especially with cash-flow.
Please note – Debit cards and corporate credit cards continue to be accepted.
If you need expert advice on completing your self-assessment tax return, please contact Paul.Edwards@affordbond.com at our Nantwich accountant’s office or use the contact form here on our website.