Tax return 2011/12

monkeyej

Can anyone help me please. I have just filled out a return for 2011/12. I work in the NHS but also do some private practice outside it.

I owe ~£11K for income earned during 2011/12. When the calculation came through, it had this and 2 other payments for tax due in 2012/13 year, with the first due Jan 2013 for £5.5K and another payment for the same amount to be paid by July 2013.

Is this new for self assessment? Is there any opt out for "pre-paying" next year's tax?

00ec25

that is the normal payment plan for the self employed. 50% of next years in Jan with balance in June based on the previous year's actual income

so is your private consultancy work self employed?

System

Its not new. They're called 'payments on account' and they've been part of self assessment from the start.

There's more info here

http://hmrc.gov.uk/sa/understand-statement.htm

Essentially the payments on account take the liability from your return as an estimate of what you'll owe for the following year too. If your circumstances are now different and you won't owe as much tax you can reduce the payments on account. There more about this on the linked site.

monkeyej

Yes. Self employment is new to me! Guess I'm just going to have to dig deep! Thanks for reply.

pjclar02

Hello there

A side issue....

If you are employed and self-employed at the same time, paying that level of tax - do make sure that you have applied for deferment of class 4 NICs (if eligible)

ceeforcat

The best way to think about this is that you will have been self employed for nigh on two years by 31st January 2013 and, because of the way the system works, have not paid a bean in tax on this income. Now it is catch up time!

chrismac1

Note that for clients the first column in my tax return file is 2012-13. One of the reasons for this is the payments on account. The default in the system is to plug in 50% of your 2011-12 bill BUT you can - and should - amend this to be 50% of your best estimate for 2012-13.

In your case, you are now nearly 8 months through 2012-13. So you have 8 months of actuals, and only 4 months of forecast to arrive at your 2012-13 income. Plug this into an online calculator or post the details on here and you'll get your estimated tax bill for 2012-13. 50% of that is what should be paid on 31 Jan 2013.