Deferral of second self assessment income tax payment on account for 2019/20

The second self assessment payment on account for the 2019/20 tax year is deferred from 31 July 2020 to 31 January 2021. In effect, this means that the 2019/20 balancing payment due by 31 January 2021 will be the total income tax, capital gains tax, Class 2 and Class 4 NIC due for the tax year, less the first payment on account. No interest will be applied for the period between 31 July 2020 and 31 January 2021.

This applies to all those required to make payments on account under self assessment, including trustees.

The deferment applies automatically without the need to make an application. Note that although the deferment applies to all, the Government asks that anyone who is able to make the second payment on account by 31 July 2020 does so, for the sake of the public finances.

Any individual wishing to take advantage of the deferral that pays their self assessment liability via direct debit (which is possible where the taxpayer uses the HMRC free software to submit a tax return) should cancel the direct debit payments. See the Payment of tax due under self assessment guidance note.

Individuals may wish to contact their advisers to see whether the impact of coronavirus may reduce their 2019/20 taxable income such that a claim can be made to reduce the 2019/20 payments on account. This would then generate a partial refund of the first payment on account.

Remember that the first payment on account for the 2020/21 tax year is also due by 31 January 2021, so a significant payment needs to be made on this date and the taxpayer will need to budget for this. If the taxable income for the 2020/21 tax year has decreased as compared with 2019/20 tax year, advisers should consider whether a claim can be made to reduce the 2020/21 payments on account.

For more details, see the Self assessment ― payments on account guidance note.