When to pay a second payment on account

Payments on account are advance payments of tax in relation to self-asessment income tax. Some self-assessment taxpayers will be required to make these payments twice a year - in January and July. For more information on what income tax payments on account are, take a look here. Keep reading to find out if you need to pay this, when and how.

Your tax return is complete

If you have already filed your 2023/24 self-assessment tax return, and you were required to make payments on account last year, your first payment on account that you made in January 2024 covers some or all of your tax liability for 2023/24. If the payment made in January covers your tax liability for 2023/24 then you may not need to make the second payment on account.

If the payment in January did not cover your 2023/24 liability, a further payment must be made by 31st July 2024.

Your tax return is not complete

If you have not filed your 2023/24 self-assessment tax return and believe your profits and therefore tax are in line with last year, then yes you do still have to make the second payment on account by the due date.

If you believe your income has reduced from last year and your second payment on account is too high, you can ask HMRC to reduce your payments on account. Caution should be taken in reducing payments on account, if it turns out they were due interest will arise from the date the payment should have been made.

How to pay your second payment on account

There are many ways to pay your tax bill, you can pay using your online HMRC account or the HMRC app. You can also make a bank payment or use online or telephone banking. Check out ways to pay here. When making any payment to HMRC it is important use your Unique Tax Reference (UTR) as a reference.

If you are unable to pay your payment on account, speak to your accountant or HMRC directly as soon as possible to discuss a plan.

How TaxAssist can help

If you would like to discuss your tax affairs further, please contact us on 01295 298747 or use our simple online contact form to arrange a free initial consultation.

Date published 21 Jul 2021 | Last updated 23 Jul 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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