Early Submission of Self Assessment - payment deadline?

DoctorStrange

If one submits their self assessment in say June is the payment deadline still January 31? Or is it linked to submission e.g. submission date + 30 days?

Dazed_and_C0nfused

31 January 2023 for the 2022:23 return.

The only thing that could be due earlier (31 January 2022 and July 2022 are payments on account).

If you had made an incorrect claim to reduce them then they could be brought back into play once the return is submitted.

Likewise submission of the return could reduce excessive POA.

Submission of a 2021:22 can never create POA for 2021:22 for the first time though.

400ixl

Did you mean 31 Jan 2023 for the 2021-2022 return rather than the 2022/23 return which won't close the year until April 2023?

Dazed_and_C0nfused

400ixl said:

Did you mean 31 Jan 2023 for the 2021-2022 return rather than the 2022/23 return which won't close the year until April 2023?

Yes!  Thanks 🙂

DoctorStrange

So I submitted my 21:22 return which has a large sum due, and which I thought I had until Jan 23 to pay.

However on my online tax account it's now showing a balancing payment due in 4 days, as well as interest due from Jan 22 - is this right?

I can't see how I can be "late" for a Jan 22 payment given the monies the unpaid tax relate to were only received in April, and the SA has been submitted early.

Grateful for any thoughts

Dazed_and_C0nfused

Have you previously filed a 2020:21 Self Assessment return?

If so did you make an incorrect claim to reduce POA for 2021:22?

DoctorStrange

Yes, a 20:21 SA was filled and all tax paid on time.

That return did include uncoded income, which HMRC then added to my POA for 21:22 on the assumption (I believe) that I'd receive the same again in 21:22. However, that was corrected as the source of that uncoded income (dividends) was sold I wasn't expecting any other uncoded income in 21:22 - everything was due to be collected via PAYE.

However, I then had some unexpected and unrelated income in April which I added to my SA which was recently submitted.

It seems that HMRC have linked these two separate things, and seem to think my original correction to their previous POA estimates was wrong and therefore they're free to backdate/reinstate a POA liability to January - does that sound plausible?

To my mind, there should be no POA due in January as there was no tax due, nor any expectation of any liability at that point. Everything was collected by PAYE and up to date. It was only in April that I started to owe tax, which I understood wasn't due until January 23 so feel hard done by with the interest payments.

Also, I only found out by accident when checking something else - if I had waited until January 23 before arranging to pay it seems my interest bill would have been far worse, which can't be right?!

Jeremy535897

If you make a claim to reduce payments on account, and for whatever reason it turns out that they should have been paid, interest will be charged. Your original correction to the payments on account was wrong, because it failed to take into account the extra income in April. Whether that income could be foreseen is irrelevant, as is the fact that the income that generated the payments on account liability was not the income that meant that they were due.

DoctorStrange

In January, all tax was up to date so how could a POA be due? What would the POA be calculated on and how would I know what/when to pay?

HMRC essentially said "we're adjusting your tax code because we think you'll receive £Xk in dividends" which I corrected.

Then later I declare a capital gain from April via SA (I realise I said income in my first post, which is technically incorrect), and a backdated POA is triggered?

Doesn't make sense to me I'm afraid.

Jeremy535897

Nor to me. There is a world of difference between changing a code and payments on account.

Payments on account due on 31 January 2022 and 31 July 2022 are on account of your expected income tax liability for 2021/22. They are calculated automatically based on what your 2020/21 tax return showed. If you know that your income tax liability for 2021/22 will be lower in total than your automatically calculated payments on account payable on 31 January 2022 and 31 July 2022, you apply to reduce them. If it turns out, for whatever reason, that your income tax liability for 2021/22 is higher than the reduced amounts you paid, you will be charged interest. However, tax on capital gains has nothing to do with payments on account, and cannot be the reason for the underpayment on payments on account.

Dazed_and_C0nfused

Jeremy535897 said:

If you make a claim to reduce payments on account, and for whatever reason it turns out that they should have been paid, interest will be charged. Your original correction to the payments on account was wrong, because it failed to take into account the extra income in April. Whether that income could be foreseen is irrelevant, as is the fact that the income that generated the payments on account liability was not the income that meant that they were due.

This is the key thing you (the op) haven't grasped.

You made a claim to reduce your POA and it turns out that was wrong.

HMRC can charge interest and penalties for this however in practice I believe they only charge interest.