How to Pay Your Self-Assessment Tax Bill

Once you have filed your Self-Assessment tax return, you will know how much income tax, National Insurance, and any other charges you owe. Paying on time is essential — HMRC charges interest and penalties on late payments, and these can escalate quickly. This guide explains your payment options, the key deadlines, and what to do if you cannot pay.

Payment Deadlines

The main payment deadlines for Self-Assessment are: 31 January — the balancing payment for the previous tax year, plus the first Payment on Account for the current tax year. 31 July — the second Payment on Account for the current tax year. If you do not make Payments on Account (because your total bill is under £1,000 or more than 80% was collected at source via PAYE), you only pay once on 31 January.

Payments on Account

Payments on Account are advance payments towards the following year's tax bill. HMRC requires them if your Self-Assessment bill is £1,000 or more. Each payment is 50% of the previous year's liability. If you expect your current year's profits to be significantly lower, you can apply to reduce Payments on Account through your online tax account — but be careful: if you reduce too much and your actual bill is higher, HMRC charges interest on the shortfall.

Payment Methods

You can pay online via your HMRC online account using a debit or credit card (though a non-refundable fee applies to credit card payments for personal tax). You can pay by bank transfer (BACS, Faster Payments, or CHAPS) using HMRC's bank details and your 10-digit UTR as the payment reference. You can pay via Direct Debit through your HMRC business tax account for regular payments. You can pay at your bank using your HMRC payslip (if you received one) — though fewer bank branches now accept these. You can pay by cheque posted to HMRC with your payslip, allowing 3 days for processing — must arrive by the deadline.

What Happens If You Pay Late

Interest runs from the payment deadline at HMRC's official late payment rate (the Bank of England base rate plus 2.5%). From 2025, this is reviewed quarterly. In addition: after 30 days overdue, a 5% penalty of the unpaid tax applies; after 6 months, a further 5% penalty; after 12 months, another 5% penalty. These penalties apply to the balancing payment — Payments on Account have different rules.

If You Cannot Pay

If you genuinely cannot pay your tax bill, contact HMRC before the deadline — not after. HMRC may agree a Time to Pay arrangement, allowing you to pay in monthly instalments. You can set up a Time to Pay online at gov.uk if you owe under £30,000, your return is up to date, and you contact HMRC within 60 days of the payment deadline. Interest still applies during the instalment period, but late payment penalties may be avoided if you enter a TTP before the original deadline.

Direct Debit Calendar

HMRC's Direct Debit for Self-Assessment must be set up in advance of each payment date. You cannot set up a Direct Debit on the payment date itself. Check your HMRC online account to schedule Direct Debits for both January and July payments at the start of the tax year.