How can I reduce payments on account for my self-assessment tax bill?

You can reduce your payments on account by making a claim to HMRC if you believe your liability for the current tax year will be lower than the amount calculated from your previous year’s tax bill.

How to Make a Claim

Form SA303: Use this form to request a reduction. You can:

Complete it online through your Government Gateway account (automatic processing in most cases)
Download and complete a paper version from Gov.uk
Submit it by post or fax

Valid Reasons for Reduction

You must provide a valid reason explaining why you believe reduced payments are justified, such as:

Income has decreased – Your business profits are down or your business has ceased
Other income has reduced – Investment income, rental income, etc. has fallen
Increased allowances or reliefs – You’re entitled to higher tax allowances or reliefs
More tax deducted at source – More of your income will have tax deducted through PAYE than in the previous year
Expecting to claim reliefs – Such as EIS (Enterprise Investment Scheme) or VCT (Venture Capital Trust) relief

Important Requirements

Your claim must:

Be made in writing (including online or by fax)
Include a clear reason for the reduction
Be submitted before 31 January following the end of the tax year
State what the adjusted payments should be

What Happens Next

Automatic processing: Most online claims are processed automatically
Acknowledgment: HMRC will send letter SA614 warning about interest charges if you reduce payments too much
Equal split: Any reduction is split equally between both payments on account
Interest risk: If you reduce too much and underpay, you’ll be charged interest from the original due dates

Important Warnings

Be realistic: Only reduce if you genuinely expect lower liability
Interest charges: You’ll pay interest on any shortfall from the original payment dates
Penalties: Fraudulent or negligent claims can result in penalties
Consider all income: You must consider your total expected liability from all sources, not just one income stream

The key is to make a reasonable estimate based on genuine changes to your circumstances – don’t just reduce because you can’t afford to pay the full amount, as this isn’t a valid reason under the rules.