[simbo]

hi can anyone explain what is this in simple terms and do we always have to pay it as just had mine for£2000 + £2700 for payment on account to be payed end jan have the money but really pi**es me off. i will be ending my third year in april am not vat reg and have looked on ir site but do not understand any better
simbo







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[Llaaww]

just another rip off so they can get the interest on the money. A bit like having a bill estimated. The inland revenue run half day courses (free) where they fill you in on the details.

[Neil Williams]

This is pay back in effect when in your first year you didn't pay any tax.
So now you pay what is owed for the previous year and they estimate that if everything stayed the same then you need to pay the same again for the next year, in 2 instalements.
At the end of next year the calculations willbe made and adjusted either up or down.
The biggest problem in all this is remembering that your tax return filled out relates to not this tax year but to the previous one.
We've just done ours which relates NOT to 06/07 but to 05/06.

[Sir Squeaky]

Yeah, they're all a big bunch of conning villans.

Take your time paying, and make them keep chasing you.
I dragged last January's bill out until last month.

Homos.

[burky-boy]

I challenged my last payment told inland venue that my next years earnings was gonna be less then the previous one. So they said make us an offer of payment . I gave them a 3rd of what they wanted

Steve

[simbo]

cheers all but does that mean i always have to pay on account or does it even out.
simbo

[Neil Williams]

cheers all but does that mean i always have to pay on account or does it even out.

You have to pay on account and yes it does even out.
You could do what squeaky said he did but remember in 12 months time if you earn more than expected you'll get a big bill to make up the difference.
The easy answer here is that the end of each week you put away into a different account the amount of money estimated as tax. Then come the bill you'll have the money to hand.
OR
You could pay upfront and over the top to the taxman. YOU'LL get 8% interest on that. (far better than any bank)

[Rob.Hall]

Thanks Neil for that one. I will use them as a good savings account....My bank only gives me 3%

[windowwashers]

dont talk about tax, just got back from a short break, and my tax bill was sitting there 

[Helen]

cheers all but does that mean i always have to pay on account or does it even out.
simbo

As far as I am aware it will work this way until the IR change there rules.
Don't confuse your personal tax with vat, they are not linked in anyway even if you are vat registered...totally separate entities.
The request for payment you have just had will relate to £2000.00 balance of year 2006/2007, so up until last April 5th ish will be paid for. Check out the £2700 is that ALL payable in January or is it split January and July. If it is all for January this is your first payment against 2007/2008 figures (from April 6th ish) and then you will be required to make a second payment in July 2008 against 2007/2008 figures.
April 2006 to April 2007 - payable January 2008
On Account payments for April 2007 to April 2008 -  payable January and July 2008
April 2007 to April 2008 -  payable January 2009
and so on.
Hope you can follow this, easy to follow in my head not so easy to put down in words.
Just follow one rule....never p*** off the tax man

[Sir Squeaky]

Just follow one rule....never p*** off the tax man

Yeah right!
That's my one aim, to cause them problems.

[Ian Lancaster]

You just ticked the wrong box, Squeaky.  A few years down the line your name will pop up with "investigation" alongside it.  And boy, can they cause you problems

[Sir Squeaky]

You just ticked the wrong box, Squeaky.  A few years down the line your name will pop up with "investigation" alongside it.  And boy, can they cause you problems

Nothing they can pin on me mate.
We'll see.

They ripped me off last year, and I made them sweat.
You may fear the villains, I don't.