Self-Assessment Tax Return: Missed your second payment?

In certain situations, you must make 'payments on account'. This means making advance payments for your self-assessment tax in January and July. Each payment is half of the previous year's tax bill, with any extra tax due then being classed as a 'balancing payment' to be paid the following January. 

Prepare your tax return sooner 

The amount to pay in July is based on your previous self-assessment tax return. If you have not already prepared your 2023/24 self-assessment tax return, We would suggest getting this completed as soon as possible. If your taxable income has reduced, or you have made other tax savings, your July payment on account would be recalculated and you may have less to pay to HM Revenue & Customs (HMRC) than you expect.  

Apply to reduce your payments on account 

If you are unable to submit your tax return now, and you have reasons to expect your tax liability to be lower than last year, you can claim to reduce your payments on account. Please note that if your payments are reduced below your actual liability, HMRC will charge interest on the underpayment. 

Speak to HMRC 

If you are still unable to pay the July payment on account, we recommend that you contact HMRC as soon as possible. Discussing your financial circumstances with HMRC will help to put a plan in place and minimise any penalties and interest. HMRC has more guidance on what to do if you are having difficulty paying your tax bill on time. 

Pay your tax as soon as possible 

If and when you are able to pay your tax, you should make the payment to HMRC as soon as possible to reduce the amount of interest charged. 

 

Date published 15 Oct 2021 | Last updated 7 Aug 2024

This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.

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