E1.251 Self assessment payments on account
As discussed in E1.250, under self assessment, income tax, capital gains tax plus any Class 2 and Class 4 national insurance due in relation to the tax year is due by 31 January after the end of the tax year1. However, where the taxpayer notified their chargeability to tax by 5 October after the end of the tax year, but HMRC does not issue the notice to file the return until after 31 October, the due date is three months from the date on which the notice to file is issued2.
To preserve a flow of tax to HMRC, where the income tax and any Class 4 national insurance contributions due for the tax year (ie the liability less tax deducted at source) is sufficiently large (see below), payments on account may be payable. If payments on account are due, two equal payments are due by3:
• 31 January in the tax year, and
• 31 July following the end of the tax year
For example, the 2020/21 payments on account are due by 31 January 2021 and 31 July 2021.
Where the payments on account are payable in relation to a trust, payment may be recovered from any one or more of the 'relevant trustees'. For the definition of 'relevant trustees', see E1.2024.
Amount of each payment on account
Each payment on account is 50% of the income tax and any Class 4 national insurance liability for the previous tax year, which the legislation terms the 'assessed