Reduce payments on account going forward after taking perm role

[matei]

Hi all,

Due to a downturn in my sector, I've take a lower paying perm role that allows me to re-skill, with an eye on going back into contracting in a year or so. Long story short, have the experience but it is about 8 years out of date.

Anyway - did a search on the forum but couldn't find out if it is possible to reduce the whopping payments on account due in July, as my ltd co hasn't invoiced since the end of February and I've taken a permie gig that pays far less than the ltd co. salary + dividends.

thanks!

[TheCyclingProgrammer]

You can reduce it but you should work out what your tax bill for 16/17 is first.

If you submit your tax return before your next payment on account is due it should be adjusted automatically.

[TheFaQQer]

If you reduce it and then end up owing more than the new value, HMRC will charge you interest on the difference so make sure you've got a good idea about what it should be and then add a little bit to be safe.

[matei]

OK - thanks for that.

I don't want to get into the situation with owing the HMRC more than I do now, so I'll just go ahead and submit my self assessment now, hopefully then the figures will be updated.

[TheCyclingProgrammer]

OK - thanks for that.

I don't want to get into the situation with owing the HMRC more than I do now, so I'll just go ahead and submit my self assessment now, hopefully then the figures will be updated.

They will, if your tax bill is lower than 15/16 you will only have to pay the balance in July (tax due less Jan payment).