Stopping Self Employment & Tax Bills?

mcooke999

I'm self employed but am considering stopping at the end of this tax year (05/04/2021) to become employed.

Please can someone explain to me what tax I will owe via self-assessment and when it will be due?

I'm assuming that I will need to fill out a tax return after 06/04/2021 detailing my profit for the 20/21 tax year so will HMRC still ask for the usual 2nd POA in July 2021 or will they just issue a final bill, presumably due by Jan 2022 or something?

[Deleted User]

You will need to fill in a tax return for 2020/21. The tax due for that year is payable as follows:

First payment on account due 31st January 2021
Second payment on account due 31st July 2021

Each if these will be calculated as half of your overall tax liability of 2019/20.

The final payment (if any) for 2020/21 will be due on 31st January 2022.This will be the total liability for that year less the two payments on account as above.

mcooke999

Thanks, that makes sense! 

mcooke999

So if I've understood correctly, even though I will have terminated my self employment by 5th April 21, I'll still have a POA to make in July 21 and balancing payment (if any) by Jan 22? 

Jeremy535897

mcooke999 said:

So if I've understood correctly, even though I will have terminated my self employment by 5th April 21, I'll still have a POA to make in July 21 and balancing payment (if any) by Jan 22? 

Yes.