Self Assessment Tax Outstanding

Leodogger

Can anyone tell me if after completing your SA tax return and you owe tax and you opt to pay the O/S balance through PAYE, do you still have to pay any balance O/S by 31/1/18 for the tax year 2016/17?

I am confused why they are chasing me up for payment by 31/1/18 when as I said instalments of £70 per month are being stopped from my pension payments straight after I completed my tax return on 3/10/17. I would add that I have made two instalments and still owe (according to the Tax Statement) £551.85 which obviously will not be paid up by 31/1/18. Strangely enough on the SA302 it states I owe £465.65 which makes no sense to me ??? Can anyone help explain this to me, I am new to completing these returns.

Dazed_and_confused

To avoid over complicating things you need to keep each tax year separate.

If you are able (and choose) to have your 2016:17 Self Assessment tax collected through your tax code i.e. extra tax deducted from your wages/pension then this will be done through your 2018:19 tax code starting in April 2018.

Any alteration to your current (2017:18) tax code will be to try and collect as much of this tax years amount as possible i.e. to prevent you having anything much to pay through self assessment.

If you have an underpayment in your current tax code this will almost certainly be for a previous tax year.

A common situation is,

2015:16 tax year - tax is owed
During 2016:17 tax year HMRC will review the prior tax year and notify you of any tax owed.
Collection of that tax underpayment will be through your 2017:18 tax code

Basically,

Year 1 - tax underpayment occurs
Year 2 - during year 2 HMRC notify you of the amount due for year 1
Year 3 - your tax code is adjusted to collect the tax due for year 1

If you check your self assessment statement you should be able to see how this will be collected, either you have to pay it by 31:01:2018 or it will show as nothing actually payable as it will be included in your 2018:19 tax code.

More info is needed about the make up of your current tax code to advise further.

Pennywise

I suspect the deductions from your pension will be the current year tax, whereas the lump sum being asked for in January will be last year's tax. HMRC are started to "catch up" so that you pay the tax you owe within the year, rather than a year behind, so that means it's inevitable that one year you'll pay two lots to catch up.

Leodogger

Yes that explains it I think, although I did do a SA last year (2015/16) and they ended up sending me a payment so perhaps that was for the previous year - I find it all very confusing but presume that I still owe £551.85 and the instalments I am paying are for the current year (2017/18)...I think !

Thanks both, I think you explained that beautifully for my slow brain LOL!

Leodogger

Pennywise wrote: »

I suspect the deductions from your pension will be the current year tax, whereas the lump sum being asked for in January will be last year's tax. HMRC are started to "catch up" so that you pay the tax you owe within the year, rather than a year behind, so that means it's inevitable that one year you'll pay two lots to catch up.

I have just tried to pay my tax bill online through World Pay with a Debit Card and it has been declined, can you tell me why ? It appeared to be processing it until it got to the security checking service with my bank and then it jumped out back to the banking details and said "Transaction Declined, Use another card" but I only have credit cards and you get charged for this.

jennifernil

You could pay via internet banking, set up HMRC as a payee using the details they give specifically for that purpose.

Leodogger

00ec25 wrote: »

there is no single answer for that, you possibly entered the wrong security details and thus the transaction was declined

have you tried again, this time being more careful over what you enter?

Yes I did and each time it began processing the payment and the Santander securing confirmation box popped up which always does when I make a visa debit payment but as soon as it begins opening up the Santander box which is my bank, it stops and cuts back to the payment bank details page and quotes " Transaction Declined, Try Another Card". I don't think it has anything to do with the details I entered, I think the system they use to process the payment doesn't accept the security check box for some reason.

Leodogger

jennifernil wrote: »

You could pay via internet banking, set up HMRC as a payee using the details they give specifically for that purpose.

Never thought of that, would I have to send the payment to the Cumbernauld Account?