What are payments on account?

Payments on account aim to help individuals spread the cost of their self assessment tax liability, by making two payments each year; on 31st January and 31st July, towards the next tax year. 

These payments are statutory if you owe £1,000 or more in tax for the last tax year and you paid under 80% of the previous years tax outside of self assessment.  



How much are my payments on account? 

Your payments on account due to HMRC are calculated based upon your last years tax liability. If your tax liability for 2023/24 (which was due to be filed by 31st January 2025) was £2,000, you would have been required to make a payment on account towards 2024/25 on 31st January 2025 of £1,000, followed by a second payment on account of £1,000 towards 2024/25 on 31st July 2025.



Balancing payments

If your payments on account do not end up covering your tax liability for the year, you will make a balancing payment on the due date of the tax return, for the remainder due. 

Refunds

If your payments on account are more than your tax liability for the year, you will then be able to claim a refund of tax, as long as you have no other tax becoming due to be paid in the next 45 days.