Payments on Account – Reminder Second Payment Due by 31st July

A reminder for anyone who needs to make payments on account towards their self-assessment tax bill, the second payment is due by 31st July 2026.

If you need to make a second payment on account, you can find the amount due on the tax calculation pages at the back of your tax return, or by logging into your HMRC account.

What are payments on account?

Payments on account are advance payments towards your tax bill.

You have to make 2 payments on account every year – by midnight on 31^st January and 31^st July, unless:

– your last Self-Assessment tax bill was less than £1,000

– you paid more than 80% of the previous year’s tax you owed, for example through your tax code or because your bank had already deducted interest on your savings

Each payment is half your previous year’s tax bill.

If you still have tax to pay after you’ve made your payments on account, you must make a ‘balancing payment’ by midnight on 31^st January next year.

Payments on account do not include anything you owe for capital gains or student loans (if you’re self-employed). These are paid in your ‘balancing payment’.

If you know your tax bill is going to be lower than last year, you can ask HMRC to reduce your payments on account.

However, if your tax bill is higher or lower than you expected, you might pay the wrong amount. If you overpay, HMRC will send you a refund. If you underpay, you’ll be charged interest.

More details can be found on the Government’s website: https://www.gov.uk/understand-self-assessment-bill/payments-on-account

Example:

Your personal tax bill for the 2024 to 2025 tax year is £3,000. You made 2 payments of £900 each (£1,800 in total) on account towards this bill in 2025.

The total tax to pay by midnight on 31st January 2026 is £2,700.

This includes:

– your ‘balancing payment’ of £1,200 for the 2024 to 2025 tax year (£3,000 minus £1,800)

– the first payment on account of £1,500 (half your 2024 to 2025 tax bill) towards your 2025 to 2026 tax bill

You will then need to make a second payment on account of £1,500 on 31st July 2026.

If your tax bill for the 2025 to 2026 tax year is more than £3,000 (the total of your 2 payments on account), you’ll need to make a ‘balancing payment’ by 31st January 2027.

Questions?

If you have any questions about your payments on account, or if you’d like help to understand the amount you owe, please contact our accounting team who will be happy to help you.

Call: 0333 242 3743 or email: support@theuncommonpractice.com