If you’re self-employed or file a self-assessment tax return, you may have a payment due on 31 July.

I get a lot of questions about this one, because it catches people out more than the January deadline does.

What is it?

If your tax bill was over £1,000 last year, HMRC usually asks you to make advance payments towards your next tax bill, called Payments on Account.

There are two: one due 31 January, and a second due 31 July. Each one is normally half of your previous year’s tax bill.

Do you need to pay it?

Not everyone does. You won’t owe a Payment on Account if your last tax bill was under £1,000, if more than 80% of your tax was already collected at source, or if you’ve already told HMRC your income has dropped and reduced your payments accordingly.

What if your income has gone down this year?

If you know this year’s profit will be lower than last year’s, you can apply to reduce your Payment on Account rather than paying the full amount and waiting for a refund later. This is worth checking every year if your income varies.

What happens if you miss it?

HMRC charges interest on late payments from the day after the deadline, currently calculated daily. It adds up quickly, so if you’re not sure whether you owe anything, it’s worth checking rather than guessing.

Not sure where you stand?

If you’re unsure whether you have a payment due, what it should be, or whether you can reduce it, get in touch and I’ll take a look for you before the deadline.