Self Assessment Tax Bill: What You Pay on 31 Jan

Do payments on account apply to you?

HMRC asks for payments on account if two things are both true: your last Self AssessmentHMRC's system for reporting income and gains not taxed at source. The online return and payment deadline is 31 January after the tax year ends. bill was £1,000 or more, and 80% or less of your total tax for that year was collected at source - for example through PAYE on an employed salary you hold alongside your self-employment.

Both tests use last year's figures, and both are exact thresholds. A bill of exactly £1,000 still triggers payments on account - the exemption only applies below that figure. The same goes for the 80% test: it has to be more than 80% collected at source, not exactly 80%, to switch payments on account off.

The £1,000 test is also worth reading carefully. It is measured on the tax actually payable through Self Assessment, after any tax already deducted at source - not your gross tax liability for the year. An employed person with a small self-employed side income can sit under the threshold even with meaningful total earnings, simply because most of their tax was already collected through PAYE.

Class 4 National InsuranceClass 4 National Insurance: National Insurance paid by the self-employed on their profits, on top of Income Tax. For 2026/27 it is 6% on profits between £12,570 and £50,270, and 2% above that. is included in the payments on account calculation alongside Income Tax - HMRC treats the two as one combined figure. GOV.UK sets out both rules.

Work out your own 31 January and 31 July numbers

Enter last year's Self Assessment position below for an itemised breakdown of what you owe on each date. If you do not have last year's exact figure to hand, the self-employed tax calculator will work it out from your profit.

Priya's first Self Assessment bill came to £2,000. Because it was over £1,000 and none of her tax was collected at source, HMRC added a £1,000 payment on account toward next year - so her 31 January total was £3,000, not £2,000, and a further £1,000 followed on 31 July. Enter your own figures above for your version of that stack.

What payments on account do not cover

Payments on account only ever estimate your Income Tax and Class 4 National Insurance. Three things are deliberately excluded from the calculation and always land in full in your balancing paymentThe top-up you pay on 31 January once your actual tax bill is known: your full Self Assessment liability for the year, minus any payments on account you already made toward it. Capital Gains Tax and student loan repayments always land here. instead:

• Capital Gains Tax. Sold shares or a second property this year? That tax is calculated separately and is due in full on 31 January - it never spreads into a payment on account. Check the figure with the Capital Gains Tax calculator.
• Student loan repayments. Collected through Self Assessment if you are self-employed, these are always part of the balancing payment, never a payment on account.
• Class 2 National Insurance. Most self-employed people with profits of £7,105 or more no longer pay Class 2 at all - it counts as paid without a bill. If your profits are below that and you choose to pay the voluntary £3.65-a-week rate to protect your State Pension record, that also lands in the balancing payment, not a payment on account.

So a reader with a share sale or a student loan should expect a bigger 31 January figure than the payments on account maths alone suggests - the fields above add them in for you.

Reducing your payments on account: the lever and its trap

If you are confident this year's profit is lower than last year's, you do not have to pay the full estimated payments on account. You can claim to reduce them online through your HMRC account, or by post on form SA303, to a figure that better matches what you expect to owe.

The trap is getting it wrong the other way. If you reduce your payments on account too far and your actual bill comes in higher, HMRC charges interest on the shortfall from the original due date - currently 7.75% a year (from 9 January 2026, the Bank of England base rate plus 4 percentage points). That rate moves with the base rate, so check the current figure on GOV.UK before relying on it. The automatic late payment penalty does not apply to an underpaid payment on account itself, only the interest does - though HMRC can charge a separate penalty where a claim to reduce was fraudulent or negligent, and a reduction made on hope rather than evidence is still an expensive guess.

Making Tax Digital changes the rhythm, not the bill

If your combined self-employment and property turnover is over £50,000, you are now in Making Tax DigitalMaking Tax Digital for Income Tax: HMRC's shift to digital tax: since April 2026, sole traders and landlords above the qualifying-income threshold must keep digital records and send quarterly updates instead of one annual Self Assessment return. for Income Tax, mandatory from 6 April 2026 (dropping to £30,000 in 2027 and £20,000 in 2028). MTD changes how often you report - four quarterly updates through compatible software, replacing one annual return - but it does not change when you pay. The 31 January and 31 July payment dates on this page, including payments on account, stay exactly the same. See the full Making Tax Digital for Income Tax guide for the thresholds and quarterly deadlines in detail.