Payment on Account- Income Tax

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Tiger
Tiger Registered Posts: 63 Regular contributor ⭐
in General accounting discussion
Hello all

Does anyone know how to calculated the payment on account for 09/10?

The situation I have is 07/08 profits did not give rise to a tax liability (below PA's). This year 08/09 the profits are higher and will give rise to a tax liability in excess of £500 per partner.

AM I correct in thinking that the POA has to be equal to the expected tax liability for yr 09/10 and split into two payments ie Jan & jul 2010.

Can some one confirm if thats correct please or advise otherwise....

Many Thanks
K

ps I'm a full member but not an MIP so don't worry

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  • burg
    burg Registered, Moderator Posts: 1,441 mod
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    Almost

    Basically the POA would be half the tax liability for 08/09 from non direct sources (i.e. non PAYE).

    However for 08/09 tax payments in January 2010 the POA amount has changed to £1000. So you do not need to make payments on account if tax from non direct sources is less than £1000.

    E.G.

    Tax for 08/09 (self employment)...£1000
    1st POA for 09/10.......................£500
    Total due by 31 Jan 2010............£1500

    2nd POA @ 31 Jul 2010................£500

    Balance for 09/10 due by 31 Jan 2011.
    Regards,

    Burg
  • Tiger
    Tiger Registered Posts: 63 Regular contributor ⭐
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    Thank you for your help..much appreciated
    K
    :thumbup1:

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