HMRC could pay you £100,000
So would it be worth paying early? And should the government spend its money on this sort of gimmick?
Is it worth it?In order to enter the draw you would need to pay your tax two months early - under the new proposals. In terms of straightforward maths, it's well worth doing this to be in with a chance of winning the jackpot.
With interest rates at rock-bottom, most of are making less than 1% on our savings. Even if you have tens of thousands of pounds set aside in a savings account, there's every chance the interest over two months could come to less than £100 (and even then you'd have to pay 40% tax on it).
Forgoing £60 in order to be in with a reasonable chance of winning £100,000, may well be the sort of gamble you would consider if the scheme gets the go-ahead.
Of course, there's more than just the basic maths to consider. For many people, building up enough cash to pay their tax bill is a delicate balance, and the money may not be available early. It's certainly not worth going into debt or paying your tax bill on a credit card and accruing all the associated fees and interest. Every situation is different, and only you will know whether paying early is feasible.
Is the taxman right?There remains the question of why on earth the government would consider doing this. It is a proposal from the government's Behavioural Insights Team. This body was set up to find ways of getting people to voluntarily change their behaviour.
At the moment, many people who complete self-assessment returns leave it to the last minute, clogging up the system and requiring HMRC to take on more staff - and incur more cost. Many also miss the deadline, which requires more staff to chase them up. The raft of penalties were brought in to encourage people not to miss the deadline, but the prize draw would be a way to encourage people to pay early of their own accord.
Although it sounds like an expensive scheme, it is estimated that it would cost no more than £250,000 to run, and would save millions if it could encourage people to pay early, or more people to pay on time.
Of course, it's worth emphasising that this is just a proposal, so don't get your hopes up. The taxman is still weighing up all its options and this is far from a foregone conclusion.
However, it's worth watching this space for more announcements, because if it is adopted it could come in later this year. It may even be a good idea to consider (while you still have time) whether you can work towards having the cash ready early just in case.
But what do you think? Is this a great wheeze, or a gimmick doomed to fail? Let us know in the comments.