Background
HM Revenue & Customs (HMRC) would like to promote the use of its ‘Pay by Bank Account’ service which is available from online filing services. This service makes use of opening banking technology.
Detail
HMRC’s embrace of open banking is part of a significantly bigger picture in terms of central government tax payments and collection in the UK, and the overall aim is to make payments to government simpler and safer. It is this automation that, its advocates believe, increases speed, reduces human error (for example, people mistyping their tax/payment reference), and also has the potential to reduce fraud.
Previously the only option was to make an immediate payment of tax. This made it unattractive if a return was filed in advance of the due date for payment. HMRC is now enhancing the service to make it possible to schedule payment for a future date, which is not beyond the due date.
The feature is currently live for the following regimes:
- VAT;
- Employers’ PAYE;
- PAYE settlement agreement;
- PAYE late payment or filing penalty; and
- Class 1A NIC.
The service will be available soon for:
- Capital gains tax;
- Self-Assessment;
- Simple assessment;
- Corporation tax;
- VAT one stop shop;
- Soft drinks industry levy; and
- Plastic packaging tax.
If you would like further information on the introduction of Open Banking for your payments to HMRC or how it may impact you, please speak to your usual contact at the firm or our Tax Director, Jenny Marks.
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