The second and final 2023/24 self-assessment payment on account for income tax and Class 4 National Insurance Contributions (NICs) is due for payment in two days’ time on or before midnight on Wednesday 31 July 2024. Each payment on account is half of the previous year’s tax bill.
Anyone who is self-employed is required to make two payments on account for 2023/24 unless:
- their 2022/23 Self-Assessment tax bill was less than £1,000, or
- more than 80 percent of all the tax owed in 2022/23 was deducted at source, for example via PAYE.
If a taxpayer knows that their tax bill for 2023/24 is going to be lower than that in 2022/23, a claim can be made to HMRC to reduce payments on account.
Each payment on account made should be 50 percent of the person’s total income tax and Class 4 NICs liability for 2022/23. If the final tax liability in 2023/24 is greater than the total payments on account made, a balancing payment will be due on or before 31 January 2025.
By way of reminder, a “Time to Pay” arrangement payment plan can be made online by a taxpayer in relation to self-assessment tax debt, including payments on account. The limit for an individual is £30,000 and £50,000 for a business.
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