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Guide

Payments on account explained

Payments on account are two advance payments towards your next Self Assessment bill. Each one is half the previous bill. They apply when the tax and Class 4 still to pay is over £1,000 and less than 80% was already collected at source.

Step by step

  1. 1Work out last year's Self Assessment bill (income tax and Class 4, after tax already deducted)
  2. 2If that bill is over £1,000, and less than 80% of the liability was collected at source, payments on account are due
  3. 3Pay the first half on 31 January, together with any balancing payment
  4. 4Pay the second half on 31 July
  5. 5If your profits fall, you can ask HMRC to reduce the payments. If you reduce them too far, interest can be charged

Common questions

When are payments on account due?

The first is due on 31 January, with your balancing payment. The second is due on 31 July. Each one is half of the previous bill.

Do I always have to make payments on account?

No. They apply when the tax and Class 4 still to pay is over £1,000 and less than 80% of the liability was already collected at source.

Common mistakes

  • Budgeting only for the balancing payment and missing the extra half
  • Assuming payments on account are a second tax bill rather than an advance
  • Reducing them without a reason

Related guides

Last checked against GOV.UK: 28 October 2026. Tax year 2026/27.

Not affiliated with HMRC. General information, not professional tax advice. Check GOV.UK or speak to a qualified adviser for your situation.