Second Payment on Account HMRC

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What is the second payment on account? If your tax bill last year was over £1,000, HMRC makes you pay this year’s tax in advance. They split this estimated bill into two equal halves. The “second payment on account” is simply the second half of that bill.

For example: Let’s say your tax bill for last year was £2,000.

Because it is over £1,000, HMRC assumes your tax bill for this year will also be £2,000. They ask you to pay it in advance in two halves:

• Half 1: You pay £1,000 by the 31st of January.
• Half 2: You pay the remaining £1,000 by the 31st of July. This July payment is your second payment on account.

If you want to read more about why this system exists and how it all comes together, check out our guide explaining [What is the payment on account for self assessment?].

What is the deadline for the second payment on account in the UK?

In the UK, the deadline for your second payment on account is always the 31st of July.

To break it down, your tax deadlines typically look like this:

• 31st January: You pay any leftover tax from the previous year, plus your first payment on account for the current year.
• 31st July: You pay your second payment on account.

Missing this deadline can lead to extra interest charges from HMRC, so it is always a good idea to mark it on your calendar. If you are ever unsure about when your bills are due throughout the year, you might find it helpful to read about [When to Pay Tax When Self-Employed].

How can I check my second payment on account balance online?

Checking how much you owe is very straightforward. You do not need to wait for a letter in the post; you can check it all online in just a few minutes.

1. Go to the GOV.UK website and log in to your HMRC online account using your Government Gateway ID.
2. Select the option to view your Self Assessment.
3. Click on View statements or View your tax account.

Here, you will see a clear breakdown of exactly what you have already paid and the exact balance you need to clear by the July deadline.

Can I reduce my second payment on account if my income changes?

Yes, absolutely! Payments on account are based on what you earned last year. But, as anyone in business knows, things can be unpredictable. If you know your profits are going to be lower this year than they were last year, you can ask HMRC to reduce your payments on account.

You can do this easily online:

1. Log into your HMRC online account.
2. Go to your Self Assessment section.
3. Select the option to Reduce payments on account and enter your new estimated figures.

Just be careful—if you reduce your payment too much and it turns out you actually earned more, HMRC will charge you interest on the difference. To help avoid surprises and make sure you always have enough cash set aside, take a look at our tips on [How Much Money Should I Put Away for Tax Self-Employed].

Managing your taxes does not have to be confusing. By understanding the July deadline, keeping an eye on your online balance, and adjusting your payments if your income drops, you can easily stay on top of things!

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