HMRC is set to fine taxpayers who missed the Self Assessment deadline for the second payment on account for the 2025 to 2026 tax year, which fell on Friday, July 31. Households that failed to file or pay by this date will now face late payment penalties, with interest accruing on any outstanding balance.
The deadline applied to the second payment on account, an advance payment towards the taxpayer’s next tax bill. However, not everyone is affected. Taxpayers are exempt from the deadline if the amount of tax they owed last year was less than £1,000, or if they paid more than 80% of the tax owed outside Self Assessment, for example through PAYE.
Ahead of the deadline, HMRC’s Chief Customer Officer Myrtle Lloyd issued a warning in a government press release confirming that fines would be imposed. “We know managing a Self Assessment tax bill isn’t always straightforward and we are here to help,” said Lloyd. “From paying instantly via the HMRC app to spreading the cost through a payment plan, there’s support available for every customer. Search ‘Pay your Self Assessment tax bill’ on GOV.UK to choose the payment option that works for you.”
Advice on avoiding late payment fines
Andrew Bartlett, chief executive of Advice Direct Scotland, highlighted how easily the deadline can be missed. “Paying a tax bill isn’t the first thing on most people’s minds during the height of the summer, which is why it is so easy to miss this particular HMRC deadline,” he said. “However, if you forget about it, late payment fines will start to build up – so make sure you log in to your online account now and check if you need to act.”
Bartlett also urged those whose financial situation has changed to seek a reduction. “If your situation has changed and you expect you will be liable to pay less tax than previously, make sure to ask for a reduction, which will keep the money in your pocket,” he added.
The true cost of missing the deadline
Elsa Littlewood, a private client services tax partner at accountancy and business advisory firm BDO, warned that the financial penalty extends beyond simple fines. “Those who miss the deadline or fail to pay the full amount due should be aware that a 7.75% late payment interest rate will be applied to all outstanding amounts owed after 31 July,” she said.
“This can significantly increase the amount owed to HMRC as interest will continue to accrue while the liability remains outstanding,” Littlewood continued. She added that taxpayers who are certain their tax bill for 2025/26 will be lower than the previous year – for example, because they have already prepared their return – can go online to ask HMRC to reduce their payments on account.
What to do if you missed the deadline
For those who missed the July 31 cut-off, the key steps are to check your HMRC online account immediately and determine whether you need to make a payment or request a reduction. If you expect your tax liability to be lower, submitting a formal reduction request can prevent overpayment and keep more money in your bank account.
For those who are struggling to pay, Littlewood noted that an alternative exists: “For those who are going to struggle to pay, there is the option of setting up a Time to Pay arrangement with HMRC.” This allows taxpayers to spread payments over a schedule agreed with the tax authority, reducing the immediate burden while avoiding additional fines.
HMRC’s Myrtle Lloyd reiterated that support is available for every customer, whether through the HMRC app’s instant payment feature or via a tailored payment plan. The key is to act now rather than ignore the missed deadline, as penalties and interest will continue to mount the longer the debt remains unpaid.
