If you are looking for information on how to pay the HMRC Self Assessment Income tax bill, you have come to the right place. There are several options available for you, including Payments on account, Budget payment plan, Single payment, and Cheque. Learn more about each of these options below. You can pay your tax bill in instalments, in advance against your next bill, or in one lump sum.

A single one-off or scheduled direct debit payment

Making one single payment for your HMRC Self-Assessment income tax bill is as easy as making two or three. There are several payment methods available, and the fastest option is Faster Payments using online or telephone banking. You can also send payments through CHAPS or Bacs, and you’ll need to make sure to have your Unique Taxpayer Reference (UTR) number and the letter ‘K’ appended to the end. Payments made using these methods will usually reach HMRC the same day or the next working day.

1. Pay by your debit card

You can make a payment online.

  • If you pay with a Business credit card, or Business debit card, there is a fee. The fee cannot be refunded.
  • While making payment using a personal debit card, there is no charge.
  • Personal credit cards are not allowed to be used for payment.
  • When you pay, enter a payment reference number. This is your unique 10-digit taxpayer reference also called UTR followed by the letter “K“.

2. Pay by HMRC online account

This option is to pay directly using an online HMRC account or HMRC portal.

When you’re ready to pay, start your Self-Assessment payment. Select the ‘pay by bank account option. 

3. Direct debit

You can set up a direct debit through your bank. HM Revenue and Customs HMRC Online account To make single payments for 31st Jan.

If you have to make a transaction on your account, you can set up another Direct Debit.

Each time you pay via Direct Debit, you will need to make single payments.

Your 11-character payment reference will be required. This is your unique 10-digit taxpayer reference ( UTR) followed by the letter “K”.

It’s also easy to find:

  • In your HMRC Online account
  • If you receive paper statements, please indicate this on your paying-in slip

It will take 5 working days to process your first Direct Debit. If you use the same bank details, it should take 3 working days to process your next Direct Debit.

Another way to make a single payment is to set up a budget plan through your HMRC online account. You’ll find details for this under the Direct Debit section of your account. Only pay your Self-Assessment bills on time to take advantage of this service. You can also choose a flexible payment plan, and you can take a break for up to six months before making a final payment.

3. Bank Transfer

You can use either of the two bank accounts below to make payments using a bank transfer

Option A: Account name: HMRC Cumbernauld

Sort code: 08 32 10, Account: 12001039, Payment reference:  UTR Number followed by ‘K’

Option B: Account name: HMRC Shipley

Sort code: 08 32 10, Account: 12001020, Payment reference:  UTR Number followed by ‘K’

3. Cheque by post

If you’re in the UK, you can still use a cheque to pay your Self-Assessment income tax bill. There are a few things to keep in mind, though. For example, if you are sending your payment to HMRC by post, you need to make sure that you include your Unique Taxpayer Reference (UTR), as well as your address. The payment slip should be made payable to HMRC, but it cannot be used for a bank giro or the Post Office.

The rules are complex and are subject to change, so it is best to check with your tax office to see what the deadline is. If you plan on paying early, you should still send a cheque. Make sure your cheque is made payable to HM Revenue and Customs and write down the 11-digit reference on the back of the check. HMRC processes payments on the date that you send them, so pay as soon as possible.

Budget payment plan in case unable to pay the large sum

If you have a high self-assessment tax bill, you may want to consider setting up a budget payment plan. The HMRC website provides the details needed to set up a budget plan, which enables you to pay your bill in advance. You can set up your budget plan in your online account by clicking on the Direct Debit section. This option is only available for self-assessment bills you’ve paid so far. This option offers a flexible payment schedule and allows you to take a payment break for up to six months, and you’ll still have to make a final payment on your bill when it’s due.

A budget payment plan allows you to set up regular payments throughout the year, and you’ll never have to worry about missing a deadline. The payment plan works because you won’t incur a late payment interest or penalties. However, you should always make sure to file your tax returns on time. This will demonstrate to HMRC that you’re willing to get things in order and increase your chances of a payment plan. If you are up to date with your Self-Assessment payments, a budget payment plan is a good option.

Frequently Asked Questions

What are the ‘Payments on account’?

These payments are spread out over the year, which helps the Exchequer. Typically, you owe 50% of your previous tax bill in each instalment. Your first instalment is due on 31 January, while your second payment is due on 31 July. It is also important to note that if you are on a payment plan that includes a balancing payment, it will affect the payment plan. We have detailed guides for Payments on account.

You may be tempted to reduce your HMRC payment on account, assuming you will have less money to pay as income is affected in the current year. However, if you do this intentionally, you may be subject to penalties and interest. If you are unsure of your tax position, review your account to determine whether it is reasonable to delay payment. Remember that paying your tax bill early will only delay your tax bill for a year. Your tax bill will then be higher the next year, and this interest will only compound.

What are the standard deadlines to pay your income tax bill?

31st January in the following year – For any tax, you owe from the previous tax year (also known as balance payment and your first payments on account).  

31st July to make your second payment for account

What happens if I refuse to pay on time or don’t contact HMRC?

If you have missed a tax payment, HMRC will contact you. You can expect letters, texts, and visits at your home or work.
You should not hesitate to contact HMRC If you are unable to agree on an instalment (budget plan) schedule:

(a) You should expect a call directly from a debt collection agency for the recovery of the outstanding bills.
(b) HMRC can collect the amount you owe directly from your employment salary and any monthly pension payments that you receive.
(c) If you are in England, Wales, or Northern Ireland, HMRC can take possession of your belongings and sell them.
(d) If you are a resident of England, Wales, or Northern Ireland, HMRC can withdraw money from your bank account directly or build a society savings account.
(e) Court proceedings
(f) Bankruptcy reporting 
(g) Orders to close your company, if the tax you are paying is a business tax.

Usually, any costs such as legal fee, admin, and auction fees are consolidated to your outstanding debt. The information provided will be available to you prior to HMRC taking any of these actions. It will also explain your costs, rights, and options.

Learn more about Taking actions  by HMRC to recover the tax or contact Accountants for Self-Employed.

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