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If you due to make your second Self Assessment payment on account for the 2019 to 2020 tax year on 31 July 2020, you have the option to defer the payment until the 31 January 2021 if you are struggling due the impact of the coronavirus.

You will still need to submit your Self Assessment tax return to HMRC on time.

You do not need to tell HMRC that you’re deferring your payment on account. However, if you normally make payments by Direct Debit and you wish to defer, you should cancel your Direct Debit so that HMRC will not automatically collect payment.

HMRC will not charge interest or penalties on any amount of the deferred payment on account, providing it’s paid on or before 31 January 2021. You can still make the payment by 31 July 2020 as normal if you wish to.

HMRC have updated their IT systems to prevent customers incurring late payment interest on any July 2020 Payment on Account paid between 1st August 2020 and 31 January 2021. As a result of this, the June 2020 Self Assessment statements showed 31 January 2021 as the due date for paying the July 2020 Payment on Account.

Options to make payments

You can pay your second payment on account bill in full online any time between 31 July 2020 and 31 January 2021.

If you do not have other overdue taxes, you can make your payment in instalments any time between now and 31 January 2021 by setting up a budget payment plan.

If you want to pay in instalments and you already have overdue tax which you’re paying through a Time to Pay instalment arrangement, you need to contact HMRC if you want to include your second payment on account in that arrangement.

You must make your second payment on account on or before 31 January 2021 as the usual interest, penalties and collection procedures will apply to missed payments after this date.

Other payments you may have to make by 31 January 2021 include balancing payments due for the 2019 to 2020 tax year and the first payment on account due for the 2020 to 2021 tax year.

You can check payments you need to make towards your next tax bill by signing in to your online account.

For help and advice with your Self Assessment tax return, please contact Ann Bibby on abibby@ellacotts.co.uk or 01295 250401.