Taxpayers warned as HMRC deadline approaches

Date: 20th July 2009

An expert has offered new tax advice to small business owners and other taxpayers who fill in a self-assessment form each year.

Millions of people only have until July 31st to make a "payment on account" - the second portion of tax they owe from the 2008/09 financial year.

The first half of this amount should also have been paid by January 31st.

However, concerns have been raised that many could miss out on this deadline - and could be hit by a range of penalties.

For example, those who missed the January deadline are due to pay an added charge of five per cent of money owed to HM Revenue & Customs (HMRC) if they do not pay by the end of July.

The effect of the credit crunch and recession, which has hit profits at many small businesses, was also cited as an added complicating factor for the payments.

Speaking to the Daily Mail newspaper, Jane Moore at the Institute of Chartered Accountants in England and Wales said: "These payments are estimated based on your income in the year that ended in April 2008.

"The recession means that quite a lot of people will have had lower incomes last year and so will owe less tax."

People affected by the July deadline include those whose income is partially or wholly outside of the main HMRC Pay As You Earn system.

This includes many Britons with larger-than-average incomes, as well as the self-employed.