How to pay your Self Assessment Tax

Chris Andreou

May 28, 2021

pay for self assessment tax guide

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Self Assessment Overview + Deadlines

You may already be familiar with the process of paying your Self Assessment tax bill.

Yet, it's always helpful to have a guide on hand—one that you can look over just before you make your payment, so you can be sure that you haven't missed out on important details that can put you at risk of incurring a penalty.

  • Submission of Self Assessment tax return: You need to submit  your online tax returns by 31st January. Paper returns are due earlier; these must be filed by 31st October. 
  • Payment: Any personal tax due for the previous tax year (6th April-5th April) must be paid up by 31st January. This means that your 2021/22 tax year must be paid up by 31st January 2023.
  • Payments on Account: "Payments on account" are advance payments for your tax bill that are spread out across the year. You'll need to make two payments each year, and these are due on 31st July and 31st January. 

Tip: If the payment deadline falls on a public holiday, make sure that your payment is submitted by the final working day.

Pay with Debit or Credit Card

To make your payment, use your 11-character payment reference (that's your 10-digit Unique Tax Reference (UTR) followed by the letter 'K'). Your payment is accepted on the day of payment, and not when it is received.

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Pay at Bank or Building Soceity

Making a payment at your bank or building society branch is a viable option, only if you're getting paper statements from HMRC and have kept your HMRC paying-in slip. Payments are accepted on the day you make your payment (if it is made on a weekday).

Pay via bank transfer

Transfers can be made using Faster Payments, CHAPS and BACS using your 11-character payment reference.

BACS payments usually take about three working days to be processed, while payments made using CHAPS are typically cleared on the same working day. Faster Payments are usually cleared on the same day, including weekends and bank holidays. 

Tip: Be sure to check in with your bank about the processing time if you're paying from abroad, as a longer duration of time might be required for the payment to clear.

Pay by Direct Debit

You can set up a direct debit through your HMRC online account using your 11-character payment reference.

You'll need to set up single payments each time you want to make a payment. For example, if you're making a payment on account, you'll have to set up a direct debit twice-one for  31st January, and another for 31st July. 

It can take up to five working days for the payment to clear for the first time you set a debit up. Subsequent payments will take up to three working days to clear, provided that the same bank details are used.

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What's Inside:

  • Allowable business expenses
  • Employee expenses
  • Travel expenses
  • Office & equipment expenses
  • Professional services expenses
  • General expenses

Pay by Cheque

You should make the cheque out to "HM Revenue and Customs only", followed by your UTR.

You'll also need to include your HMRC paying-in slip. It can take up to three working days for the cheque to clear, and you need to keep in mind to factor in additional time for mail delivery. 

Your cheque should be sent to: 

HMRC 

Direct 

BX5 5BD

Making payments for Self Assessment

Paying your Self Assessment tax bill through your tax code

To pay your Self Assessment tax bill through your tax code, you'll need to meet the following conditions: 

  • You owe less than £3,000 on your tax bill
  • You already pay tax through PAYE. For example, you're employed or you get a workplace pension
  • You've submitted your paper tax return by 31st October, or your online tax return online by 30th December

If you meet these conditions, HMRC will automatically collect what you owe through your tax code, unless you've asked them not to do so on your tax return.

Tip: Do note that payments made at the post office or using a personal credit card are no longer permitted.

How will I know if my payment has been received?

You can check your payment status using your HMRC online account. It should indicate that you've paid up between three to six working days after you've made your payment.

What can I do if I'm unable to make my payment on time?

Being unable to pay up your tax bill is a stressful situation to be in, but there are steps you can take to set things right. 

You'll need to get in touch with HMRC as soon as possible to explain why you're unable to make your payment. Before you contact HMRC, make sure you have your UTR number and bank account details on hand, as well as an estimate of how much you're able to pay upfront.  

Depending on your circumstances, HMRC may agree to a payment plan. In this case, you won't be charged payment penalties (unless you miss a payment), but HMRC late payment interest rates will still apply. 

And even if you know beforehand that you're not able to pay up your Self Assessment tax bill, it's still important that you file your tax returns on time. This indicates that you're willing to set things in order, and will improve your chances of getting a payment plan set up with HMRC. 

Setting up a budget payment plan

Setting up a budget payment plan is a viable option if you are up to date with your previous Self Assessment payments.

With this option, you'll be making regular payments in advance instead of a lump-sum payment. You can decide how much you want to pay each week or month. If your payments over the year aren't sufficient to cover the total tax due, you'll need to pay up the outstanding amount by the payment deadlines.  

To set this up, use your HMRC online account. On the Direct Debit Section, choose the budget payment option when filling in the Direct Debit form.

A note on Making Tax Digital for Income Tax

Making Tax Digital (MTD) for Income Tax will be rolled out starting 6 April 2023. If you're a sole trader or landlord with an annual income exceeding £10,000, you'll need to abide by the MTD requirements for the 2023/24 tax year onwards.

Presently, you're still required to file your Self Assessment for 2021/22 and 2022/23, unless you've applied for the MTD for income tax pilot scheme (and have followed the requirements of the scheme).

There hasn't been any announcements made on whether the MTD rollout will affect how income tax payments are made.

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How to pay your Self Assessment Tax Guide

How to pay your Self Assessment Tax

You may already be familiar with the process of paying your Self Assessment tax bill.

Yet, it's always helpful to have a guide on hand-one that you can look over just before you make your payment, so you can be sure that you haven't missed out on important details that can put you at risk of incurring a penalty.

  • Submission of Self Assessment tax return: You need to submit your online tax returns by 31st January. Paper returns are due earlier; these must be filed by 31st October.
  • Payment: Any personal tax due for the previous tax year (6th April-5th April) must be paid up by 31st January. This means that your 2019/20 tax year must be paid up by 31st January 2021.
  • Payments on Account: "Payments on account" are advance payments for your tax bill that are spread out across the year. You'll need to make two payments each year, and these are due on 31st July and 31st January.

Tip: If the payment deadline falls on a public holiday, make sure that your payment is submitted by the final working day.

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How do I pay my self assessment? Guide

How do I pay my self assessment?

There are various ways to pay your Self Assessment Tax bill.

Same or next day

You need a paying-in slip from HMRC to pay at a bank or building society.

3 working days

5 working days

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What are Company Deadlines?

As a limited company director, there are several important deadlines you need to be aware of. These are:

  • File your Self Assessment tax return: 31st January 2022 for the 2020/2021 tax year
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  • Registering for VAT: Register for VAT within 30 days of meeting the conditions for compulsory registration
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  • Company accounts: First year accounts are due 21 months after incorporation. Subsequent accounts are due 9 months after the year end
  • Corporation tax registration: You need to register within 3 months of trading commencing.
  • File your corporation tax return: 12 months following the end of your accounting period
  • Corporation tax payment: 9 months and 1 day following the end of your accounting period
  • File your Confirmation Statement: You need to file a confirmation statement every 12 months, within 14 days after your confirmation date.
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What are Self Assessment Tax Returns?

A Self Assessment (or Self Assessment tax return) is a form that business owners are required to submit to HMRC every year. It details how much you've earned and your sources of income, which enables HMRC to work out the Income Tax and National Insurance you need to pay.

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What is a Self Assessment tax form SA100?

The SA100 is the main document you need to fill when completing your Self Assessment tax return. There are two ways to complete your Self Assessment tax return: you can make an online submission, or download the form SA100 and make a paper submission.

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What deadlines do I need to know as a contractor?

As a contractor running your own limited company, you need to be aware of the following deadlines:

  • File end of year accounts to Companies House: 9 months after your company year ends. If it is your first year, the due date will be 21 months from the date your company was incorporated.
  • File your confirmation statement: This is due on the anniversary of incorporation each year
  • File your corporation tax return: This is due 12 months from your company year end.
  • Pay your corporation tax bill: Payment is due 9 months and 1 day after the end of the company year
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  • the 22nd after the end of the quarter if you pay quarterly
  • VAT returns: Usually submitted on a quarterly basis, the company VAT is due to be filed and paid within 1 month and 7 days from the quarter end.
  • Self Assessment tax returns: Your Self Assessment Tax Return is always due to be filed by the following 31st January after the end of the tax year. This date is also the same deadline for payment of any tax due but you may also have a payment on account due by 31st July after this.
  • P11D: The submission of the company P11D will need to made by 6th July with any payment of National Insurance arising due by 19th July (22nd if paid electronically)
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Can I change my company's accounting date / year end date?

You can change your company's year-end-otherwise known as the accounting reference date (ARD). Changes can be made to your current financial year or the year before.

Your company's financial year can be shortened as many times as you want, with the minimum duration you can shorten it by being one day. You can lengthen your company's financial year by up to 18 months once every five years. If other conditions apply, such as if your company is in administration, you'll be able to lengthen your financial year more often.

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What are the deadlines for payment of PAYE taxes? Guide

What are the deadlines for payment of PAYE taxes?

If you're paying salaries to employees or directors, you need to register for PAYE and pay your PAYE bill to HMRC.

  • Monthly payments: Your PAYE bill is due on the 22nd of the next tax month.
  • Quarterly payments: Your PAYE bill is due on the 22nd after the end of the quarter.

There are various ways to make your payment.

  • Same or next day payments: online or telephone banking, CHAPS
  • Payments processed in 3 working days: card payments (online), Bacs, cash or cheque payments at your bank or building society, Direct Debit, by cheque through the post
  • Payments processed in 5 working days: Direct Debit (if it's the first time you're setting up a Direct Debit payment)

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What are Self Assessment payments on account? Guide

What are Self Assessment payments on account?

Paying your taxes can seem complicated, particularly if you're newly self-employed. There are numerous elements you need to understand and stay on top of, and one of these is the payment on account.

To help you get a grasp on the essentials, we've written up a quick guide below. It'll cover what a payment on account is, how it works, late payment penalties and other key information you need to know.

Payments on account are advance payments for your tax bill that are spread out across the year. You'll need to make two payments each year, and these are due on 31st January and 31st July.

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When do I need to pay my self assessment tax bill? Guide

When do I need to pay my self assessment tax bill?

Payments for your Self Assessment tax bill are due on:

  • 31st January: You'll need to pay tax that you owe for the previous tax year, as well as your first payment on account. For the 2020/21 tax year, the first payment on account is due by 31 January 2021, while the balancing payment is due on 31 January 2022.
  • 31st July (following the end of the tax year): You'll need to pay your second payment on account. For the 2020/21 tax year, the second payment on account will be due on 31 July 2021.
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Self Assessment tax returns for the self employed Guide

Self Assessment tax returns for the self employed

If you're self-employed-either as a business owner or freelancer-you will need to complete a Self Assessment tax return.

It's one of the most important tax documents you will need to handle, and there are numerous details you'll have to keep in mind, including deadlines and late penalties.

Our guide offers a quick overview of the essentials-so it's just the article you need if you're getting started.

A Self Assessment (or Self Assessment tax return) is a form that business owners are required to submit to HMRC every year. It details how much you've earned and your sources of income, which enables HMRC to work out the Income Tax and National Insurance you need to pay.

This applies to self-employed workers, who-unlike employees-don't have their income tax automatically deducted from their salaries.

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What is your First Accounting Year End Date? Guide

What is your First Accounting Year End Date?

The first accounting year end date for a new company is the last day of the month in which the first anniversary falls on. For example, if your company was incorporated on 15 January 2021, the first accounting year end date will be 31 January 2022.

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What are the late filing and payment penalties? Guide

What are the late filing and payment penalties?

PAYE

RTI late filing will incur a monthly penalty of £100, depending on the number of employees you have.

Self Assessment

A late filing penalty of £100 is imposed if your tax return is up to three months late. The penalty increases if you're later than three months, or if you pay your tax bill late. Additionally, interest will be charged on late payments.

VAT

You may be required to pay a surcharge if you submit a late return. Surcharges for late payments or VAT return filings are indicated on the HMRC website.

Corporation Tax

HMRC's penalties are as follows:

  • 1 day late: £100
  • 3 months late: An additional £100
  • 6 months late: Your total corporation tax bill will be estimated, after which a penalty of 10% of unpaid tax will be imposed.
  • 12 months late: An additional penalty of 10% of unpaid tax will be imposed.

Company accounts

The following penalties for private limited companies will be imposed if you fail to file your accounts with Companies House on time:

  • Up to 1 month late: £150
  • 1 - 3 months late: £375
  • 3 - 6 months late: £750
  • More than 6 months late: £1,500


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When is the next self assessment deadline? Guide

When is the next self assessment deadline?

The deadline for filing Self Assessment is 31 January following the tax year end. For example, the deadline for the 2020/2021 tax year is 31 January 2022.

Payments for your tax bill are due on 31st January after the end of the relevant tax year. If you're making payments on account, there are two payments due each year on 31st January and 31st July.

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