Second Payments on Account are due by 31st July!

News, Personal Tax,

Second Payments on Account for the tax year 5th April 2021 are due for payment by the 31st July 2021.

We’ve reminded all of our cents of the amounts they’re due to pay, and provided details of how to do so, but as we’re all so busy and with life generally reopening, I thought another reminder wouldn’t be a bad idea!

How can I pay my second Payment on Account?

There are lots of ways to make your payment! You can find them by clicking on the button below and downloading our ‘How to Pay’ sheet.

Please be sure to do this in time for your payment to reach HMRC in good time. It can take between three and five working days for your payment to get to them, so don’t leave it too late!

If you would like to spread the cost of your payment across up to 12 months, you can do that online, by following this link. You must owe less than £30,000, have no other tax debts and have no other HMRC payment plans in place. You must use this option within 60 days of the payment deadline.

What if I don’t pay my tax in time?

HMRC will charge penalties and interest if the second payment on account is not received in time, UNLESS you have already agreed a payment arrangement with them. You will still pay interest on the unpaid amount, but you can avoid penalties if you arrange the payment plan before the tax falls due.

Contact details:

Self Assessment Payment Helpline Telephone: 0300 200 3822

Opening hours: Monday to Friday 8am to 6pm

What if my income has reduced this year?

Your Payments on Account for 2021 are based on the income you declared in your Tax Return for the year ended 5th April 2020, just after the pandemic struck. This means that many people will be declaring significant lower income figures for the year ended 5th April 2021.

As a result, it is possible to reduce your Payments on Account to take account of this reduction, but you need to be careful!

If you reduce the Payment on Account to a level that is below the amount that your Tax Return subsequently shows, you will have to pay interest on the difference, as HMRC were entitled to those funds by 31st July 2021. In this case, it may be less of a risk to pay the full amount requested, and recover any resulting overpayment from HMRC once your 2021 Tax Return has been submitted and processed. We take care of this for our clients.

If you have any questions or concerns around your second Payment on Account, or your Self Assessment tax position, please get in touch; we’re here to help!

Similarly, if you haven’t yet sent us the information relating to your Tax Return for the year ended 5th April 2021, we’d love to receive it from you sooner rather than later please! You can post it to us, email it over, or use our Document Transfer portal to send it securely. There are lots of reasons why it’s better to get it done and out of the way as early as possible…

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