New year shock looms for hundreds of thousands as payment method is removed
Hundreds of thousands of taxpayers hoping to defer the pain of their annual tax bill by paying on plastic will be hit by an HM Revenue & Customs ban on personal credit card payments which comes into force from January 13.
The ban is a response to new rules that mean HMRC will no longer be able to pass on the bank charges for processing credit card payments.
The timing is likely to cause difficulties for some of the 11m Britons trying to completetheir annual tax return, as it comes just before the January 31 deadline for settling 2016-17 tax liabilities.
HMRC sent out written warnings with tax bills this month stating: “From 13 January 2018 HMRC will no longer accept payment by personal credit card. Debit cards and corporate credit cards continue to be accepted.
Taxpayers who want to use credit cards are being urged to file their returns and pay their tax bills before 13 January. After that, the options open to those currently reliant on credit cards to fund their tax payments include taking out a personal loan. Alternatively they could use money transfer credit cards to borrow money and transfer it to their bank accounts. They might also be able to negotiate “time to pay” with HMRC.
Taxpayers are no longer able to pay by cash or cheque at the Post Office, after the Post Office Transcash service ended on 15 December 2017. The ICAEW, the accountancy body, said the move followed the expiry of the contract with Santander which allowed this method of payment.