Are You About to Pay Twice the Tax You Expected?

What You Need to Know About HMRC’s Payment on Account (Before July 31st)

If you’re self-employed or receive untaxed income, you could be in for a nasty surprise this summer.

Every year, thousands of people are caught off guard by HMRC’s Payment on Account system, and end up paying double what they expected in January or July.

At M Wasley Chapman & Co, we want to make sure you’re not one of them.

Here’s what you need to know, and what to do before the next deadline hits.

🔍 What Is a Payment on Account?

A Payment on Account is a way HMRC collects income tax in advance for the next tax year.

Instead of waiting until next January to pay your full tax bill, HMRC asks you to make two advance payments based on your previous year’s tax bill.

You’ll typically make:

• 50% of your last tax bill by 31 January
• Another 50% by 31 July

Simple? Maybe. Surprising? Absolutely, especially if no one warned you it was coming.

🚨 The Hidden Catch: It’s Not Just Your Current Tax Bill

Let’s say you owed £4,000 in tax last year. You’d expect to pay £4,000 in January, right?

Well, HMRC will also ask for another £2,000 in January (your first Payment on Account), and another £2,000 in July.

💸 Total paid by July? £8,000.

This is where so many people feel blindsided.

😱 Why So Many People Are Caught Out

• Newly self-employed? You may not know about this system yet.
• Increased income? Your advance payments are based on your last bill, not this year’s, so they may be too low.
• Dropped income? You could be overpaying unnecessarily unless you act now.
• No accountant? You’re probably figuring it out the hard way.

💼 What If You Can’t Afford It?

Good news, if you expect your income to be lower this year, you can apply to reduce your payments on account. But it must be done carefully, reducing them too far can lead to interest or penalties later on.

This is where we come in. At M Wasley Chapman & Co, we:

✅ Calculate if you’re eligible to reduce your payments
✅ File the reduction request to HMRC on your behalf
✅ Help you plan ahead so your tax bills aren’t a shock
✅ Offer support year-round, not just at tax deadlines

✅ What You Should Do Next

📅 Check your tax payments NOW – before the July 31st deadline.

Even if you’ve already made your first payment in January, you may still have another one due soon.

💬 Not sure if this applies to you?

Get in touch today and we’ll review your tax position with no jargon, no pressure, and no surprise bills.

📞 Ready for some clarity?

 Contact M Wasley Chapman & Co today for straightforward advice on Payments on 

💬 Know someone who’s self-employed?

Share this blog with them, it could save them a fortune in unexpected tax!