Jump to content
House Price Crash Forum

Archived

This topic is now archived and is closed to further replies.

djm1972

Why No Interest Or Other Incentive To Setup An Income Tax Direct Debit?

Recommended Posts

Just got my July tax bill from Her Majesty and included was some blurb about setting up a monthly fixed amount direct debit; which actually makes an element of sense because when your income tax isn't taken out of your salary you do have to keep a mental note of how much you're going to owe - and make sure it's available.

Currently, I do my own monthly standing order into a savings account so I've always got the money ready come Jan / July, but I'd go with the DD option if HMRC offered some kind of incentive to, such as interest or an allowance :D

Share this post


Link to post
Share on other sites

I remember, you're the man who brought us this gem of a thread:

Interesting scenario just came up - I ordered and consumed a drink and a meal, and then asked for the bill - which was £7.99. I offered a £20 Bank of England note, and was given a Scottish £10 as part of the change.

Not wanting to be bothered with the hassle of trying to spend a Scottish £10 note in my local corner shop, I asked for it to be exchanged for a "normal" £10 note; which they were more than happy to do.

However, there are 2 inter-twined legal scenarios here and I'm not sure I can resolve it. They are A ) that of how / when and in what terms you are legally obliged to pay for something you have already had (you are effectively in debt to the restaurant at this point), and B ), their acceptance of your tender - taking them in debt to you.

Would I be along the right lines in thinking that a mutual stand-off still occurs; you are in debt to the restaurant; who can demand payment of that debt from you in legal tender, but at the same time, whatever they offer you in change (provided they accept your tender of course) must also be in legal tender; otherwise you have every and the same right to refuse that...?

:blink:

Share this post


Link to post
Share on other sites

reminds me of this:

http://www.telegraph...-World-War.html

The Conservatives are working on a pilot for a new automated bank-based system that would remove the responsibility of deducting and paying income tax from employers. The new system could save businesses up to £5.5bn according to the Tories and increase revenues to the Exchequer of £1bn., according to the Tories election hopefuls.Rather than leaving employers to process different tax codes and pay income tax for employees, the new system would automatically deduct income tax and national insurance contributions directly from an employee's gross pay as it is paid into their bank account.

It sounds like it could be expanded to self employed to me, it is essentially a Direct Debit income tax system for employees...

Share this post


Link to post
Share on other sites

Just got my July tax bill from Her Majesty and included was some blurb about setting up a monthly fixed amount direct debit; which actually makes an element of sense because when your income tax isn't taken out of your salary you do have to keep a mental note of how much you're going to owe - and make sure it's available.

Currently, I do my own monthly standing order into a savings account so I've always got the money ready come Jan / July, but I'd go with the DD option if HMRC offered some kind of incentive to, such as interest or an allowance :D

You already have the incentive of the money being in your savings account 6 months longer than those who pay as they earn.

Share this post


Link to post
Share on other sites

Why would you ever want to pay your tax by DD?. For a start a DD is them taking money and the very last thing you want is them deciding to when and how much to take. The big advantage of self assessment is that you pay as late as possible and earn interest on it in the bank. Anyone that is self-employed has a variable income and thus it is unsuited to a DD. Some months are good, others are bad, much easier to total it for the year as people currently do.

Share this post


Link to post
Share on other sites

Why would you ever want to pay your tax by DD?. For a start a DD is them taking money and the very last thing you want is them deciding to when and how much to take. The big advantage of self assessment is that you pay as late as possible and earn interest on it in the bank. Anyone that is self-employed has a variable income and thus it is unsuited to a DD. Some months are good, others are bad, much easier to total it for the year as people currently do.

Hate to break it to you but the revenue decide when & how much to take whether you pay by DD or not. January's payment is the 1st payment on account towards your tax bill for the year following the one in which you are reporting plus the shortfall tax due for the reporting year & the 2nd payment to account is then due in July. Those payments to account are based on your actuall tax bill for the previous year so unless you put a claim to reduce the payments to account prior to paying the 1st one then thats just what you've got to pay & thats what the revenue are entitled to take should you choose to pay by DD.

Share this post


Link to post
Share on other sites

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 145 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.