Don’t forget the Self Assessment second payment on account deadline of 31 July 2024. 

If HMRC required you to file a Self Assessment tax return for the tax year 06 April 2022 to 05 April 2023 you should have completed and filed the return by the 31 January 2024.

If your 2022/2023 tax liability was greater than £1,000 HMRC you would usually need to pay payments on account towards the liability for the 2023/2024 tax return during the 2023/24 and 2024/25 tax years as follows:-

Tax Return 2023/2024

First Payment on account       31 January 2024

Second Payment on account 31 July 2024

Balancing payment                 31 January 2025

The payments on account are based on the prior year’s tax return and each payment on account will normally be 50% of the prior year’s liability. The balancing payment will be any additional tax that is due when you file your 2023/24 Self Assessment Tax Return.

The only reason you would not have a payment on account is if you had a tax liability in the previous year of less than £1,000 or your tax situation has changed, for example you are now employed and your tax is collected through PAYE.

Example: 2022/2023 Self Assessment Tax Return Liability £5000.00

2023/2024 Self Assessment Tax Return Liability £6,000

Check your Payment on Account

If you are unsure whether you have a payment on account or how much is due you can check by signing into your Government Gateway account.

1. Sign into your Government Gateway;
2. Select the option to view your latest self assessment return;
3. Select “view statements”;
4. Check payments on account you have already made;
5. Check if there are any payments you need to make towards your next tax bill.

Reducing Payments on Account

Payments on Account can be reduced where it is known that the tax liability will be less than the previous year. The Taxpayer will need to ask HMRC to reduce the payments on account and be prepared to offer a legitimate reason for the reduction.

The Payments on Account can be reduced by:

• Signing into the Taxpayer’s online account;
• Selecting the option on the self assessment tax return before filing;
• Applying by post using form SA303.

If, when the actual tax liability is calculated, the Payments on Account have been underpaid HMRC will charge interest on the underpayment.

Payment Methods

There are various ways that you can make your payment and this includes:-

·         Online or telephone banking;

·         corporate credit or debit card on-line - Note there is a fee if you pay by corporate credit card. Note HMRC will not accept payment by personal credit card;

·         Personal debit card – there is no fee;

·         At your bank or building society;

·         Direct Debit (if previously set up with HMRC);

·         By cheque through the post – Cheques should be posted together with your payment slip to:

HMRC

Direct

BX5 5BD

Allow at least 3 working days for your payment to reach HMRC.

Please be aware that HMRC online payment services may be slow during busy times.

HMRC Bank Account

Your bill/reminder letter will tell you which HMRC account to pay into. If you do not have a bill or if you are unsure make payments to HMRC Cumbernauld.

The two available HMRC bank accounts are as follows:

Payment Reference

To ensure your payment is correctly allocated to your account you will need to use your 11 character payment reference.

The reference is made up of your personal 10 character Unique Tax Reference (UTR) with the letter “K” added at the end. The reference can be found on your:

·         HMRC online account

·         Self Assessment Tax Return

·         Reminder payment letter

Your payment may be delayed if you use the wrong reference number.

Payment by Instalments

The tax due for a tax year should be paid as cleared funds to HMRC by 31 January following the end of the tax year. For the 2022/2023 tax year any tax liability should be paid by 31 January 2024.

If the Taxpayer cannot pay their tax bill on time they should contact HMRC as soon as possible to make a Time to Pay arrangement.

A Time to Pay Arrangement for a self assessment tax bill can be set up through the Taxpayer’s Government Gateway account if:

• The latest return has been filed
• The tax owed is less than £30,000
• The contact is within 60 days of the payment deadline
• The Taxpayer intends to pay the debt off within the following 12 months or less

Alternatively the Taxpayer should contact HMRC on:

Self Assessment Payment Helpline Telephone Number: 0300 200 3822.