HMRC have published an advisory for Self Employed tax payers who are not able to pay all of their 2019/20 Self Assessment liabilities by 31 January 2021.
“Payment of 2019 to 2020 Class 2 National Insurance contributions
“Self Assessment clients who need to claim a contributory benefit soon after 31 January
2021, must make sure Class 2 National Insurance contributions payments are paid. This
is to make sure their claims are unaffected, which could happen if:
– they can’t pay all of their 2019 to 2020 Self Assessment (SA) liabilities by 31 January
2021
– they’ve entered into a Time to Pay arrangement to repay those liabilities through
instalments.
“As Class 2 National Insurance contributions are included in their 2019 to 2020
Balancing Payment, these two options may mean they won’t have paid the necessary
Class 2 National Insurance contributions payments by 31 January 2021.
“If this applies to your client, they should contact HMRC on 0300 200 3822 for help as
soon as possible. We may be able to allocate funds from any 2019 to 2020 SA liabilities
already paid to clear the Class 2 National Insurance contributions and note their record
that their Class 2 National Insurance contributions were paid on time.
“Your client may incur a small amount of interest as a result, but their contributory
benefit claim should be protected.”
If you have entered into a formal Time to Pay Agreement, or have otherwise not been able to pay all of your 2019-20 tax by 31 January 2021, we advise you to contact HMRC and discuss reallocation.