When do you need to pay and what are payments on account?
The payment of taxes should be made by the 31st of January following the end of the tax year that they relate to, this is regardless of when you file your tax return.
If the tax you pay is more than £1000 you will also need to make payments on account, these are payments towards next year’s tax bill and are due on the 31st of January and 31st of July each year. The amount you pay is half of the tax you have paid for the year for each payment.
For instance, if the tax you owe is £1500, you will be required to make payments of £750 in January and £750 in July. When you submit the tax year you will pay the balance that is due after deducting the two payments on account you have made during the year and then make the next two payments on account for January and July.
You will not need to make payments on account if the tax deducted at source is more than 80% of the total tax you are due to pay for the year. Tax deducted at source will include tax deducted in your tax code or income tax on bank interest.
If you are late paying your tax penalties will be applied to your account.
30 days late 5% of tax due
6 months late 5% of tax outstanding
12 months late 5% of tax outstanding
If you want to make an appeal against the penalties for late filing or late payment you will need to complete form SA370 and post to HM Revenue and Customs.