Not paying / cancelling payment on account?

plehxat

I was self employed for the tax year of 2010 - 2011 and for some of 2011 - 2012. I paid all my tax on the 2010 - 2011 earnings.

I owe about £8,000 on the 2011 - 2012 earnings which I intend to pay in January 2013 (as is expected of me by law).

Problem is I didn't account for my "payment on account" (the half of my 2010 - 2011 earnings which they assume I'll make in 2011 - 2012 and ask me to pay half for in advance (July 2012)) and so I now have a bill for a few thousand pounds that I didn't account for.

Can I request that payment on account either be delayed or not be required on the basis that I am no longer self employed? I will be paying my taxes for the year at the end of the year, but I can't pay half in advance.

jimmo

To be honest, I can’t make head nor tail of the details in your post because there are 2 payments on account each year, one in January and one in July.
However it looks like form SA303 will be your friend.
http://www.hmrc.gov.uk/sa/forms/sa303.pdf
You can certainly reduce your payments on account to zero using that form.

plehxat

jimmo wrote: »

To be honest, I can’t make head nor tail of the details in your post because there are 2 payments on account each year, one in January and one in July.
However it looks like form SA303 will be your friend.

You can certainly reduce your payments on account to zero using that form.

The January payment on account was paid with my tax, which I paid in January.

The simplest way to explain it: I'm no longer self employed, however I was for some of the last tax year. My payment on account due July 31st and I don't have the cash to pay for it.

Thanks for the link, I will check it out.

Edit: Seems I cannot do this as my self employed earnings were greater than half of my payments on account.

System

It's not you earnings that you need to look at but rather the tax due for the year. Work out what your 2011-12 tax bill will be and compare that with the payments in account you've been asked to pay.

ceeforcat

What will be your tax bill for 2011/12?

If it is £2000 reduce your payments on acount for JANUARY 2012 and JULY 2012 to £1000 each. You will then also have nothing further to pay in January 2013 on the assumption that your liability does not indeed exceed £2000.

gkerr4

i'm in the exact same boat - was self employed during september / october last year before taking a "proper job" again which I hope to keep for the current tax year - i owe £5k for the self emplpyed period, but they want me to pay £7k to cover the first "on-account" payment - even though i know that my new job with PAYE will mean I have no outstanding tax liability in 12/13

what do i do?
g

InsertWittyName

If you're registered online for self assessment then log in and reduce your payment on account, otherwise phone them to sort it out.