Payments on account are advance payments towards the following year's Self-Assessment tax bill, required from most people whose tax liability exceeds a set amount. Two payments are due each year, in January and July.
Reducing payments on account
If income is expected to fall, a taxpayer can apply to reduce their payments on account. Reducing them too far can lead to interest charges if the eventual tax bill turns out higher than expected.
Tax rules depend on individual circumstances and can change. This glossary is general information rather than personalised tax advice.