How do I reclaim HMRC "payment on account"

[Remittub]

Hoping that someone can advise me on reclaiming 1st payment on account and preventing 2nd payment !!

I filed my 2018-2019 self assesment in January prior to the end-of-month deadline. Due to a large (abnormal) US dividend, I had to pay £3659 in tax - no problem with that as I was expecting to have to pay on the windfall !! HOWEVER, I was then amazed that I was then going to have to pay £1829 as a first payment on account by 31st January for the tax year 2019-2020 !!! I ignored it as I though that it didn't apply, but ended up making the first payment of £1829 soon after as I had been charged interest by missing the date.
I have now entered details for the 2019-2020 tax year, thinking that the "View calculation" step would include the payment on account. However, it hasn't !! Although I entered the information, I have not yet filed my return in case something needed to be changed to get things sorted. Is that the problem (and will it get straightened out when I file my return ?). How else can I reclaim the £1829 ? (and prevent the 2nd. payment !!)

[D&C]

The need for payments on account are based on your liability, not the individual income sources that might have contributed to the liability.

So nothing unusual in having POA for the subsequent tax year.

Your Self Assessment tax calculation does not (and should not) reflect any payments you have made. It is calculation of your liability for that tax year.

Which will update your Self Assessment account once you file it.

For example if the calculation shows you owe say £100 for 2019/20 then each POA for 2019/20 will be reduced to £50. In that specific example you would not have any POA for 2020/21 but would have them for 2019/20, albeit only £50 each one.

[maths]

D & C is much more knowledgable than me in this area and will no doubt correct my post if necessary.

You can apply to reduce your POAs on Form SA 303 by post or on-line. Deadline for filing is on or before 31 January next following the tax year of assessment ie 31.1.21 for 19/20.

Once a claim is filed showing a smaller POA figure for 31.1.20 than you actually paid a refund will be made for the excess.

[D&C]

That's correct although not sure about any excess being automatically refunded?

My post was more based on the fact that the op seemed to be ready to file their 2019/20 return. Which would over-ride any claim to reduce. The POA for 2019/20 would then be based on the actual amount due for 2019/20 (assuming this is less than the original POA amounts)

[maths]

If the 19/20 income tax liability is likely to be smaller than that for the tax year 18/19 then on or before 31.1.21 can a claim for reduced POAs for tax year 19/20 and to be paid on 31.1.20 and 31.7.20 not be lodged?

The fact that the first POA has already been paid on 31.1.20 shouldn't change this?

Given that each POA would be lower than that already paid on 31.1.20 a refund would be forthcoming re the 31.1.20 POA and the lower claimed POA paid as normal in 31.7.20?

[Remittub]

Thank you both for your replies - my "View calculation" shows that I have tax overpaid of £123.60 on my 2019/2020 return. So, hopefully, when I file my return, my account should roll the 1st payment on account into the refund, totalling £1829 + 123.60 = £1952.60. But will it then recognise that the 2nd payment on account should be voided, or will I have to pay it and then have to correct it following my 2020/2021 return ??
I CAN understand that this "payment on account" mechanism is aimed at the likes of the self-employed so that tax payment (albeit in advance !!) is spread over 2 payments. However, it seems wrong to me that just because I had a "one-off" tax liability, I get thrown into this - my return clearly shows that I am NOT employed.
Anyway (rant over !!), I'd appreciate a view on whether the 2nd payment in advance needs to be paid !!
Many thanks for your advice !

[D&C]

If the 2019/20 return itself is showing an overpayment then each POA for 2019/20 will automatically be reduced to nil once the return has been submitted to HMRC and processed.

You will be due a refund of £123.60, the tax overpaid for 2019/20, plus the payment you have made of £1829.

POA aren't just relevant to those who are self employed, they are an integral part of the Self Assessment system and as maths has explained you could make a claim to reduce them if you felt that your 2019/20 liability was going to be less. But filing your return supercedes any claim to reduce so if you intend filing the return shortly there is no benefit in making a claim to reduce them.

Bit confused why you think these are advance payments though. The first POA is due three quarters of the way through the tax year and the second several months after the tax year has ended. An awful lot of employees will have had to start paying their tax for 2019/20 in April 2019.

[Remittub]

Hi D&C,
Many thanks for your advice - much appreciated !

"Bit confused why you think these are advance payments though. The first POA is due three quarters of the way through the tax year and the second several months after the tax year has ended. An awful lot of employees will have had to start paying their tax for 2019/20 in April 2019."

I take your point about the timing of 2nd POA (my mistake !) I suppose my REAL objection is that the assumption is made that my future liabilty is based on my last tax bill and that I have to pay it in advance of my end-of-year tax return.

Anyway, thank you again ! I'll get filing ... !!

[maths]

D & C; all is now clear!