Under the current tax regime, in certain situations you must make what we call 'payments on account' in January and July. Each payment is half of the previous years tax bill, with any balance then being classed as a 'balancing payment' that is made in the following January.
If you haven’t already prepared your 2023 self-assessment tax return, I would suggest getting this completed as your income may have dropped and, therefore, your second payment on account would be recalculated once the return is submitted.
Alternatively, if you now have the money to be able to pay, you should make the payment to HM Revenue & Customs (HMRC) as soon as possible to reduce the amount of interest it charges.
If you are still unable to pay the second payment on account, you should contact HMRC as soon as possible so it can look at ways to assist you with making the payment – more details can be found here.
Date published 15 Oct 2021 | Last updated 5 Jul 2023This 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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