Self Assesment second payment on account

[David Story]

Hello
I'd like to ask you for an advise, please.

In my previous tax year I had to pay 2nd payment on account due for this year. I didn't pay full amount only half of it. Now I received a letter from HMRC asking me to pay the rest of it.
The thing is I'm almost 100% sure that I won't need to pay as much tax because of my lower then expected earnings.

So, the question is, do I still need to pay it and then wait for them to refund my payment or don't pay it at all.

Thank you
David

 

[faradaykeynes]

Ideally you should have availed option of reduced payment of account while submitting tax return.
If you know you next year tax+NI liability you can work out second payment on account accordingly and perhaps write to SA department for change in circumstances

 

[David Story]

So, the safest way is to pay it and do this year self assesment, and wait for a possible refund ?

 

[Jeff FV]

I was in the same position a year ago.

What I did was, as soon as I could (i.e. April) I did and submitted my new tax return. As this showed that I hadn't made the same profit in that tax year to the previous one and my tax due had already been paid on account (taxable profit was about half the previous year) I didn't then have to pay the second half of my tax on account in July.

I don't know if this will help you as you may not be able to submit your tax return for last year (Apr 13 - Mar 14) before you have to pay 2nd tax on account payment. But regardless, in your circumstances it probably best to do your most recent tax return asap as it may speed up any refund due to you (if you pay your 2nd tax on account bill.)

Hope that makes some sort of sense?

J

 

[David Story]

Jeff, exactly the same situation. The problem is that the deadline is tomorrow and my accountant is away for another two weeks.
I may try to do self assessment myself. I did it in the past but this year is different as I become limited company in June.
May be to complicated.

 

[Jeff FV]

I'd suggest that, if you have the cash, pay the ammount on account that's due tomorrow, then do (either you or your accountant) your new tax return as soon as possible to get the payments refunded. If you miss tomorrow's deadline you may get fined.

 

[Anna Chandley]

There is no fine for paying a payment on account late although you would be charged interest if you make a late payment. If you are registered with HMRC online and can log in to your account there is an option to reduce payments on accounts. If you know the total tax payable for 2013/14 you can reduce the payments on account so that each payment is 50% of the total tax due.

 

[David Story]

Well, I'm going to pay it and do my tax return ASAP. Last question, do you think I can use business account ?

 

[David Griffiths]

If you are sure that there is nothing payable, then don't pay it. HMRC aren't going to do anything even by way of sending reminders for a few weeks and by then your accountant will be back and able to reduce the payments on account for you

There won't be any interest charge if it is eventually found that nothing is payable

 

[MyAccountantOnline]

I'll second Anna and Davids advice.

I certainly wouldnt make a payment on account if you are sure nothing is due.

 

[MyAccountantOnline]

This my be helpful to read