Self Assessment July Payment on Account 2026: Everything You Need to Know Before the 31 July Deadline
If you’re self-employed, a sole trader, landlord, contractor or company director who completes a Self Assessment tax return, one date you shouldn’t overlook is 31 July 2026.
For many UK taxpayers, this is the deadline for making the second Self Assessment Payment on Account for the 2025/26 tax year.
While January tends to receive most of the attention, the July deadline is just as important. Missing it could mean paying interest to HMRC, while using it as an opportunity to review your tax position can help you avoid an unexpected tax bill in January.
At Honest Accounting, we believe good accounting is about more than filing returns on time—it’s about helping you plan ahead, improve cash flow and remove unnecessary stress.
What Is a Self Assessment Payment on Account?
A Payment on Account is an advance payment towards your next Self Assessment tax bill.
Rather than paying all of your Income Tax and Class 4 National Insurance in one payment, HMRC asks many taxpayers to spread the cost over two instalments.
You’ll usually need to make Payments on Account if:
- Your previous Self Assessment tax bill was more than £1,000
- Less than 80% of your tax was collected at source, such as through PAYE
Each payment is normally 50% of your previous year’s tax liability, with payments due on:
- 31 January
- 31 July
Once you’ve submitted your Self Assessment tax return, any remaining balance (or refund if you’ve overpaid) is dealt with the following January.
You can read HMRC’s official guidance on Payments on Account here:
HMRC Payments on Account
https://www.gov.uk/understand-self-assessment-bill/payments-on-account
When Is the July Payment on Account Due?
The second Payment on Account for the 2025/26 tax year must be paid by 31 July 2026.
It’s important that payment reaches HMRC by the deadline.
Missing the payment could result in:
- Interest charges
- A larger tax bill to find in January
- Unnecessary financial pressure
- Reduced cash flow
Information about paying your Self Assessment tax bill can be found here:
Pay Your Self Assessment Tax Bill
https://www.gov.uk/pay-self-assessment-tax-bill
Why July Is the Perfect Time to Start Planning for January:
Many business owners focus solely on making the July payment.
In reality, it’s also the ideal opportunity to look ahead.
Your January Self Assessment bill isn’t a surprise—it’s simply the next stage of the tax cycle.
By reviewing your income now, you have around six months to prepare.
This means you can:
- Put money aside gradually
- Avoid scrambling for funds after Christmas
- Improve your cash flow planning
- Understand whether your tax liability is increasing
- Sleep easier knowing you’re prepared
At Honest Accounting, we encourage clients to think beyond tax deadlines and instead build good financial habits throughout the year.
Better Tax Planning Means Better Cash Flow.
One of the biggest challenges for growing businesses isn’t making profit—it’s managing cash flow.
Tax planning is one of the simplest ways to stay in control.
Reviewing your position in July allows you to:
Budget with Confidence
Knowing what’s coming means fewer surprises later.
Protect Your Cash Flow
Setting money aside monthly is far easier than finding a large lump sum in January.
Avoid HMRC Interest
Late payments now can become expensive later.
Understand Your Tax Position
If your business has grown significantly, you’ll know early if your January bill is likely to increase.
Focus on Growing Your Business
Less time worrying about tax means more time serving customers.
Can You Reduce Your Payments on Account?
Sometimes.
Payments on Account are based on your previous year’s tax bill.
If your profits have reduced, your income has fallen or your circumstances have changed, you may be able to reduce them.
HMRC explains how to do this here:
Reduce Your Payments on Account
https://www.gov.uk/guidance/claim-to-reduce-payments-on-account
However, reducing them without good reason can be risky.
If your estimate is too low, HMRC will charge interest on the underpaid amount.
That’s why it’s worth speaking to an accountant before making any changes.
Common Self Assessment Mistakes We See:
Every year we help clients who have unintentionally created problems simply because they didn’t understand how Self Assessment works.
Some of the most common issues include:
- Forgetting the July Payment on Account
- Assuming the January payment is the only deadline
- Not setting money aside throughout the year
- Underestimating profits
- Reducing Payments on Account without checking the figures
- Waiting until January to think about tax
Most of these problems are entirely avoidable with a little planning.
How Honest Accounting Can Help:
Whether you’re completing your first Self Assessment tax return or you’ve been filing returns for years, having someone review your tax position can provide valuable peace of mind.
We can help you:
- Confirm whether a July Payment on Account is due
- Estimate your January tax bill
- Improve your cash flow planning
- Check whether reducing Payments on Account is appropriate
- Keep you compliant with HMRC
- Take the stress out of Self Assessment
Our advice is always practical, straightforward and focused on helping your business succeed.
Don’t Leave January Until January.
The businesses that stay in control of their finances don’t leave tax planning until the last minute.
By taking action now, you’ll have more time to budget, fewer surprises and greater confidence in your finances.
If you’re unsure whether your July Payment on Account is due or would simply like a clearer picture of what your January tax bill could look like, we’d be happy to help.
Call Honest Accounting today
📞 0333 138 0003
✉️ chay@honestaccounting.co.uk
Frequently Asked Questions:
Q. What is a Payment on Account?
A. A Payment on Account is an advance payment towards your next Self Assessment tax bill based on your previous year’s tax liability.
Q. When is the July Payment on Account due?
A. The second Payment on Account is due by 31 July 2026.
Q. Who has to make Payments on Account?
A. Generally, anyone whose previous Self Assessment bill exceeded £1,000 and who paid less than 80% of their tax through PAYE.
Q. Can I reduce my Payments on Account?
A. Yes, if you expect your tax bill to be lower than the previous year. However, reducing them incorrectly can result in HMRC charging interest.
Q. What happens if I miss the deadline?
HMRC will normally charge interest on late payments and you’ll still need to pay the outstanding amount.
Helpful HMRC Resources
For further guidance, visit the official HMRC pages:
- Payments on Account
https://www.gov.uk/understand-self-assessment-bill/payments-on-account - Pay Your Self Assessment Tax Bill
https://www.gov.uk/pay-self-assessment-tax-bill - Self Assessment Overview
https://www.gov.uk/self-assessment-tax-returns - Check Payment Deadlines
https://www.gov.uk/self-assessment-tax-returns/deadlines - Reduce Payments on Account
https://www.gov.uk/guidance/claim-to-reduce-payments-on-account