Payments on account

Posted by cjtrevor PM | on Thu, 29/07/2010 - 17:04 527 2 comments | report

I'd be grateful if anyone could confirm their opinion of payment on account due in this situation, with any reference to support if possible -

Tax liability 2009/10 - £1,200

Payment on ac Jan 10 - £450

Payment on ac Jul 10 - £450

Elect for balance to be collected by PAYE, so the balance of £300 is collected via PAYE code.

Our software says payment on account now due for 2010/11 -

31 Jan 2011 - £450

31 July 2011 - £450

But I assumed that payment on account should either be -

Zero

or £600 each (ie 50% of the 2009/10 liability)

Any comments?

Comments

software is right

JCresswellTax | Thu, 29/07/2010 - 21:25 | Permalink

When u are collecting part of the liability through the tax code, that amount gets knocked off for payment on acc purposes.

Therefore, 300 gets knocked off ur liability of 1,200 meaning payments on acc totalling 900 are due, or 450 each.

Box 3 on page TR5

Kingston2 | Sat, 31/07/2010 - 12:27 | Permalink

I wonder whether, if you tick box 3 on page TR5, the 2010-11 payments on account change to £600 each? At the moment is the program "assuming" that £300 re the 2010-11 payments on account will be put through the PAYE code?