Andrew Chamberlain, of the self-employed trade body Ipse, said freelancers had already raided savings set aside to cover tax bills, just to stay afloat. Many would struggle to pay their debts, he added.

“Even though earnings for the pandemic year will be lower, meaning reduced tax, freelancers now have to pay additional taxes on grants, all while trying to reinvest in their business and cover bounce back loan repayments. With rising costs, finances will remain squeezed,” he said.

Nimesh Shah, of accountants Blick Rothenberg, said small businesses were still struggling and would not be able to find the money to cover bills. 

He said: “Anyone who took state support during the pandemic now has to pay tax on what they received. Those who have not yet got back on their feet may not have sufficient cash to actually pay their debts, having spent their support money on keeping themselves and their business afloat during the pandemic.”

The tax office said anyone struggling to pay what they owe can spread their tax bills using its repayment plan known as “Time to Pay”. More than 800,000 people currently use the system.

HMRC extended the normal Jan 31 deadline for the second year in a row this year due to the ongoing pressure of the pandemic on freelancers and landlords. Accountants reported huge levels of staff sickness due to the omicron variant, which was spreading at the time, which, they said, had made it impossible to get clients’ affairs sorted.

The tax office has also come under fire for upping the interest rate charged on outstanding debts, while keeping what it pays on refunds frozen at 0.5pc. Critics accused the tax authority of “stacking the decks in its favour”.