Spreading out your tax bill is easier with the payments on account scheme, but the second deadline for 2023/24 is fast approaching. Fortunately, you still have time to ensure you meet the July 31st deadline and avoid any costly penalties
What are Payments on Account?
This scheme helps self-employed individuals manage their tax bill by splitting it into two advance payments throughout the year. The amount is based on your previous year’s tax liability.
Key Dates:
Second Payment on Account Due: July 31st, 2024
Balancing Payment Due (if applicable): January 31st, 2025 (for the 2023/24 tax year)
Who Needs to Pay?
This applies to all self-employed individuals unless:You owe less than £1,000 in tax (payable in full with your first return). You’ve already paid more than 80% of your total tax liability
Reducing Payments on Account
If you anticipate your next tax bill will be lower than the previous year, you can reduce your payment on account by contacting HMRC. Here are three ways to do so:
Speak with us
If we have the authority we can adjust your payment on account directly.
Contact Us Here
Important Note
Reducing your payment on account below the actual amount owed will accrue interest on the difference.
Missed Deadline? Here’s What to Do
Missing the deadline can be costly. You’ll face late payment interest (currently at 7.75%) and potential penalties. If you can’t make the payment, contact us immediately to discuss a time to pay arrangement with HMRC
We Can Help!
Managing your tax obligations can be complex. Contact Us today to ensure you’re on top of your payments on account and avoid any potential penalties.