ATT welcomes cautious approach to more frequent tax payment

1 December, 2021

The Association of Taxation Technicians (ATT) welcomes HMRC’s confirmation that they will consult further before moving to more frequent payment of tax for small businesses.

This confirmation comes in the response published yesterday (30 November) to an earlier government consultation on bringing payment under Income Tax Self-Assessment (ITSA), and Corporation Tax (CT) for small companies closer to the point where the income or profit arises.1

Jon Stride, Co-Chair of the ATT’s Technical Steering Group, said:

“We have long-held concerns2 that any compulsory move to more frequent tax payments could have a negative impact on the cash flow and administrative burdens of small businesses. This would be particularly unwelcome at a time when many such businesses are still feeling the effects of the pandemic. We welcome the Government’s confirmation that they will not make any such changes within this Parliament.

“We are also pleased to see a commitment to engage further with stakeholders to explore how a voluntary system for more timely tax payments might operate, and look forward to working with HMRC on this.”

The ATT had also previously urged HMRC to better promote its largely unknown and unused Budget Payment Plans3 before embarking on any wholesale change to the timing of tax payments.

Jon Stride said:

“We welcome the sensible decision to make improvements to the Budget Payment Plan, including raising its prominence online and increasing payment flexibility. But we recommend that HMRC also explore expanding this offering so that it is available to small companies as well as individuals.”

Notes for editors

  1. The consultation response and original consultation document can be found here.
  2. See our press release of 15 July 2021 here.
  3. HMRC’s Budget Payment Plan is a voluntary tool for ITSA taxpayers who are up to date with their self-assessment payments and wish to make regular weekly or monthly payments (of any amount they choose) towards their next tax bill.