What is a Payment on Account?

HMRC introduced Payments on Account as a way to help self-employed people spread their tax bill throughout the year.

It means that you pay tax in two installments:

  • first in January
  • second in July.

Why is my first Payment on Account so high?

Basically in your first year you have to pay 150% of your tax bill at once.

For example:

  1. Your tax bill for 2017/18 is £5,000
  2. You need to pay this in full by January 31st 2019
  3. You also need to pay an additional advance payment of £2,500 (50% of £5,000) at the same time.
  4. Finally you have to pay another £2,500 by July 31st 2019.

What if my income is smaller next year?

Simply ask the HMRC to reduce your payment.

Either:

However, we recommend you simply pay the payment on account as it is: if your profits will indeed be down, then HMRC will simply refund you the difference.

What if my income is higher next year?

You will be required to make a “balancing payment” by January 31st next year so your account is up to date.

How to check what to pay

Simply log in to your online account and click “View statements”.

You can find information on:

  • payments you’ve made already
  • your next payments.

Is it optional?

No.

Once you submit your self assessment tax return, you are automatically enrolled in it.

The only exceptions:

  • you’ve already paid 80% or more of the total tax amount you owe (for example, through PAYE)
  • your tax bill from self assessment was under £1,000.

Need help with your tax return?

Get your self assessment prepared for you online by certified accountants for £99

Online self assessment preparation assisted by professional accountants

How TaxScouts works

Simple online tax assessment

1. Simple online tax assessment

Our online tax-bot will go over your tax situation and will make sure you won’t overpay your taxes.

Chat to human advisors

2. Chat to human advisors

You can talk to one of our tax assistants at any time during the process when you have any questions.

We’ll sort your documents online

3. We’ll sort your documents online

We’ll tell you exactly what documents you need and sort them for you online. You just upload them or snap a picture with your phone.

Everything gets prepared for you

4. Everything gets prepared for you

Your certified accountant will go over your details & prepare your tax return for you to review. It will be filed on your behalf once you approve it.

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Who our service is for

First time tax filers

We have a simple online service that guides you through the entire process. Regardless of your reasons for doing your tax return we'll help you get it done right.

Construction workers

We'll prepare your self assessment and help to maximise your CIS tax refund. We have the lowest fees in the industry and you don't have to pay up front if you're eligible for a refund.

People living overseas

Our service allows people living abroad to prepare their income tax return online. We are able to process all returns regardless of your current country of residence.

Company directors

UK company directors are required to file their self assessment annually. TaxScouts handles this through a simple online process.

Landlords

Long Lets, Airbnb, Capital Gains. TaxScouts will sort out your self assessment and take away the worry of tracking all the recent tax changes.

Self-employed

TaxScouts ensures the self employed don't overpay on their taxes. We'll help you benefit from all the tax breaks and deductions that can be applied to your return.

And for everyone else who needs to do their self assessment

At TaxScouts we appreciate that tax returns are highly individual. Before you get assigned an accountant we make sure to understand your circumstances and help you build your optimal tax profile.

Let's start by creating your account

What happens next

  • We'll ask you a couple of short questions
  • Then we'll tell you what documents we need
  • Finally one of our qualified accountants will file your tax return
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