Haven't paid your tax bill?

For those tax self assessors who didn't manage to pay their 2006/07 tax bill by 31 January, another deadline looms ever-closer - Thursday 28 February. This is the date when people are charged an automatic 5% surcharge on top of the amount still owing, plus additional interest payments, warns the Association of Chartered Certified Accountants (ACCA).

Chas Roy Chowdhury, head of taxation at ACCA, says, "31 January isnt just about sending your tax form in on time; it's also about paying on time. HMRC leaves 28 days to allow people who did not pay at the end of January to do so."

But what should people do if their tax return is still late and if they cant pay their tax?

Roy-Chowdhury explains, "A late tax return coupled with non payment of tax by 28 February means that the taxman will estimate the amount due - which they call a 'determination' of tax to be paid. If this determination is believed to be wrong, then the self assessor must issue a completed tax return for the figure to be changed - and again they will be liable to penalties and surcharges because the return will still be late."

Roy-Chowdury adds that the best thing to do is make sure the taxman knows when you can pay. "It's important to keep your tax office aware of when they can expect payment. There is little opportunity to avoid HMRC's charges, which are designed to deter late payment, and the impact soon adds up. Interest is charged from the due date - 31 January - and an additional 5%t surcharge is imposed on any of the final tax bill which is still unpaid six months after it was due."

When it comes to paying tax, here is the timetable of events:

• 31 January 2008 - if the tax bill for the previous year was over £500, HMRC will ask for an advance payment - or 'payment on account' for the current tax year equal to one half of the previous year's bill.
• 28 February 2008 - an automatic 5% surcharge could be made if tax payable for the year 2006 / 07 has not been paid in full.
• 6 April 2008 - new tax year starts, self assessors will receive a Notice to Complete a Tax Return (SA136).
• 31 July 2008 - this is the second important date for those who make 'payments on account'. If a second payment on account for the tax year ending 5April 2008 is needed, then this is the date by which it should be paid. A second automatic 5% surcharge is levied if tax due on 31 January 2008 remains unpaid.
• 30 September 2008 - if sending a paper Tax Return, this needs to be sent back to HMRC by this date if the self assessor wants the taxman to collect tax through their tax code.
• 30 December 2008 - the deadline for sending in a tax return on-line if the taxman is to collect tax through your tax code. And the process rolls onwards, with a December-time request from HMRC for payment, called a 'Statement of Account'. This statement asks for payment of tax owed for the previous tax year by 31 January - the 'balancing payment'.