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Where Taxpayers and Advisers Meet

Payment on Account

Vitturiazzu
Posts:1
Joined:Sat Apr 09, 2022 5:26 pm
Payment on Account

Postby Vitturiazzu » Sat Apr 09, 2022 5:35 pm

A big thanks in advance if someone help me understand how it works.

I have a property rented and i also have my employment.

I paid my taxes through a self assessment last year and that self assessment included the famous payment on account.
I paid last year the big bill. :D

This year though, the tax i anticipated through the payment on account have not been deducted in the new calculation this year.

So i m going crazy trying to understand where the money unticipaded last year have gone.

Doesn't hmrc adjust the figures automatically? Or do i have to fill a form to claim them back.

In my logic i cannot pay double every year but only the first year because i paid in advance.

Am i correct or there is something i am missing?

D&C
Posts:153
Joined:Mon Nov 25, 2019 11:35 pm

Re: Payment on Account

Postby D&C » Sun Apr 10, 2022 8:30 am

You are getting two totally separate things mixed up.

Your Self Assessment calculation shows the liability for the year over and above any tax deducted at source, for example the tax deducted by your employer. It never ever includes any tax you have paid direct to HMRC.

Once you have filed your return you need to wait 2 or 3 days for if to be processed by HMRC and then your Self Assessment account will be updated and this is where the POA come into play. Example below.

2020/21 liability = £3,000
2021/22 liability = £4,000
2022/23 liability = £3,500

31/01/2022 = 2020/21 Balancing Payment £3,000

31/01/2022 = 2021/22 1st POA = £1,500
31/07/2022 = 2021/22 2nd POA = £1,500
31/01/2023 = 2021/22 Balancing Payment = £1,000

31/01/2023 = 2022/23 1st POA = £2,000
31/07/2023 = 2022/23 2nd POA = £2,000

When the 2022/23 return is filed the final two entries above will be amended and the Balancing Payment entry created

31/01/2023 = 2022/23 1st POA = £1,750
31/07/2023 = 2022/23 2nd POA = £1,750
31/01/2024 = 2022/23 Balancing Payment = £0


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