Self Assessment Late Fees

TheSpectator

You need to take a step back - how much was your 2022-23 liability? If over £1000 this would have created payments on account for 23/24 due 31 Jan and 31 Jul 2024. If you were due to pay payments on account and you didnt pay anything until December 2024 you will have been charged interesy.

Taxpayer2025

DRS1 said:

Taxpayer2025 said:

DRS1 said:

Taxpayer2025 said:

TheSpectator said:

Without seeing your Self Assessment statement of account it's virtually impossible to say.

I've just read on another site it may be because I didn't pay my bill in 2 payments. I still don't understand as it's not late.

Usually with self assessment you pay the tax due on 31 January but you also pay two Payments on Account on 31 January and 31 July which are then credited against the tax due the next 31 January.  Is that how you have been doing it?

No, I have always paid the full amount at the end of December. Have I accidently opted myself into something? Can I opt out and continue as I was? This is the first time I've had them.

I think there is a threshold (£1000?) where they do not ask you to pay the Payments on Account.  Maybe you used to be below that and then went over it?  But you should have had a Self Assessment Statement asking you to pay in January and July 2024.

This might explain it then, most years it hovers around 800-1000. Last Decembers payment was 1200. This Decembers payment was 850. I guess because it went over 1000, they wanted a July payment. Which I didn't do.

[Deleted User]

eskbanker said:

Taxpayer2025 said:
I guess the rules around tax have changed and I haven't noticed. Which is all on me, I understand that. Doesn't seem fair though.

The rules are unlikely to have changed, but perhaps your income tax liability has crossed a threshold, or the like, but if you're looking for something more than a guess then it would be worth sharing more detail about what your statement says (and how it differs from previous ones).

Indeed - they have never changed in 27 years!

[Deleted User]

Taxpayer2025 said:

DRS1 said:

Taxpayer2025 said:

DRS1 said:

Taxpayer2025 said:

TheSpectator said:

Without seeing your Self Assessment statement of account it's virtually impossible to say.

I've just read on another site it may be because I didn't pay my bill in 2 payments. I still don't understand as it's not late.

Usually with self assessment you pay the tax due on 31 January but you also pay two Payments on Account on 31 January and 31 July which are then credited against the tax due the next 31 January.  Is that how you have been doing it?

No, I have always paid the full amount at the end of December. Have I accidently opted myself into something? Can I opt out and continue as I was? This is the first time I've had them.

I think there is a threshold (£1000?) where they do not ask you to pay the Payments on Account.  Maybe you used to be below that and then went over it?  But you should have had a Self Assessment Statement asking you to pay in January and July 2024.

This might explain it then, most years it hovers around 800-1000. Last Decembers payment was 1200. This Decembers payment was 850. I guess because it went over 1000, they wanted a July payment. Which I didn't do.

That would have meant that you should have made a payment on 31st January 2024 of £600 and again on 31st July 2024. 

Now - EACH of them will be retrospectively reduced to £425. But both were not paid, thus late and attracted interest. 

As before, your statement of account will show that. 

Taxpayer2025

I think I have worked out what has happen then. I've always been under 1000. I know what I need to do now. Thank you everyone. It wont happen again.

Dazed_and_C0nfused

Taxpayer2025 said:

I think I have worked out what has happen then. I've always been under 1000. I know what I need to do now. Thank you everyone. It wont happen again.

Don't forget these aren't "advance" payments.

POA are payable on 31 January after the start of the tax year in question and then a second one on 31 July after the end of the tax year.

Both of which are a long time after PAYE tax will have been paid by most people.