Households to be stung with HIGHER charges as tax deadline looms in DAYS

HOUSEHOLDS are set to be stung with higher charges as a huge tax deadline looms within days. Thousands of self-employed people have just days to pay the second instalment of their tax bill. Households are set to be stung with higher charges as a huge tax deadline looms Credit: Getty The deadline for dealing with your “payment on account” bill is this Friday, July 31. Missing the deadline means interest will begin building on the outstanding amount. Sign up for the Money newsletter Thank you! HMRC’s late-payment interest rate currently stands at 7.75% – more than double the Bank of England’s 3.75% base rate. This is because the tax authority now charges the base rate plus four percentage points, up from 2.5 percentage points before April 2025. Someone who failed to pay an £800 bill could owe approximately £862 after a year, assuming the interest rate remained unchanged. Tom Goddard, assistant manager at audit and tax firm Blick Rothenberg, said taxpayers must ensure their debt is settled by the deadline or risk facing the “excruciatingly high” rate. Payments on account are two advance payments that most self-assessed taxpayers must make each year when settling their tax bills. These payments are made on January 31, and at the end of July and are and estimate of the tax you owe. Most read in Money Get FREE tax guidance about inheritance, property and capital gains worth £250 * If you click on this link we will earn affiliate revenue Are you sick of handing over your hard-earned cash to the taxman? You could slash your tax bill legitimately with the right planning, from inheritance tax on your home to savings and pensions. Award-winning financial advice firm Kellands Chartered Financial Planners are offering Sun Money readers a free one-hour consultation with their experts worth £250. Claim your free session today Kellands (Hale) Limited is authorised and regulated by the Financial Conduct Authority. FCA Firm Reference No: 193498 So, on January 31 2026 you’ll have paid roughly half of what the taxman estimates will be due for the tax year that ran from 2025/26. On July 31, you pay the other half – this is the second payment on account. Once you have submitted your tax return for the tax year – due in January 2027 – you’ll make up the difference between the estimate and reality, or get a refund if you’ve overpaid. You have to make the payments on account every year unless your last Self Assessment tax bill was less than £1,000 or if you’ve already paid more than 80% of all the tax you owe. For example, if you have paid through your tax code or because your bank has already deducted interest on your savings. You can check your payments on account using this tool from HMRC to work out what you should be paying. Anyone struggling to pay should contact HMRC as soon as possible, as they may be offered a payment plan. Some sole traders and landlords also face a Making Tax Digital deadline on August 7, when the first quarterly update is due for those brought into the scheme from April 2026. Comment now