What is Budget Payment Plan? How to Set Up?

In case you are a self-employed person and fill out your own taxes, the Budget Payment Plan (BPP) helps individuals pay their taxes easily. This plan offers flexibility and easy way of payments to the customers. This mode of payment of tax is completely voluntary. Any person opting for making payments through BPP can:

• Decide to make weekly or monthly payments to the HMRC
• Choose or change the regular amount of money to be transferred to the HMRC
• Break or suspend the payments made to HMRC for 6 months
• Cancel BPP at any time

In simpler words, the Budget Payment Plan by HMRC is for self-employed persons. This plan makes payments of self-assessment taxes easy and allows the customers to set up an amount of regular payments that will be automatically paid to the HMRC weekly or monthly. Other than this the customer could also stop the payment for 6 months.

How can I set up my Budget Payment Plan?

To set up your budget payment plan, you will need to create and use the account created by HM Revenue and Customs (HMRC). Once you log in, you need to go to the direct debit section in the menu of your account and the option for budget payment and fill out the form for direct debit along with the amount of money if you wish to have deducted.

What happens if the amount paid is not enough?

Although Budget Payment Plan (BPP) makes things easy for the self-employed persons, it may so happen that even with monthly deductions or weekly deductions your tax payments are still short. In such as case, you will be required to pay the amount due to the HMRC by or before the deadline to avoid penalties. If you can’t afford to pay the entire tax all at once, you will be required to pay off the amount due by the deadlines.

Can we send cheques to the HMRC?

You can easily spend cheques to HM Revenue and Customs (HMRC) addressed at:

HMRC Direct BX5 5BD

You should give at least 3 days for the HMRC to process your payments.

What do you need to include?

When you make your payments or send cheques to the HMRC to make payments for your taxes for the year, make sure that you address your payments to ‘HM Revenue and Customs only.’ Apart from this, you will need to add your Unique Taxpayer Reference (UTR) number in the form or the cheque as well.

Is Budget Payment Plan cheaper than other methods?

Although Budget Payment Plan offers many benefits to the taxpayers, the plan does not actually make anything any cheaper. The plan allows you to use your funds and make regular payments regardless of the deadlines. But this does not reduce the amount of money you need to pay the authorities. All the Budget Payment Plan scheme offers to you is an easy way to maintain your taxes and an easy way to make regular payments against what you owe to the authorities.

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