Anyone reduced Payment on Account successfully?

[vwdan]

Evening all. Last year was a bit of an exception for me as I drew out an unusually large amount of divvies for my house deposit and then unexpectedly got a nice permie job offer which means I owe a reasonable chunk of tax for 15-16. That's not an issue - I knew it was coming and put some aside. My "issue" is the Payment on Account for next year - I thought PoA was 50% of this year, so was just going to suck it up, but it's 50% each payment meaning I'm about to give a whole chunk of cash to the tax man.

I left that employment and came back to contract and I'm actually now in the opposite boat - I've paid so much PAYE tax this far that I'm very unlikely to owe much tax next year - especially as I'm trying to build the company reserves back up.

I know I'll eventually get a refund, but I live by the "Always easier to negotiate when the money's in YOUR pocket" motto, and I'd rather like to not hand it over at all.

I noticed that on the SA I can put in a request for an adjustment (And, yes, I've literally just asked my accountant about it) but I was just after any related anecdotes people have. Do they get pissy about it, give you the benefit of the doubt?

[missinggreenfields]

I just completed the form and got them to reduce it from a value in the thousands down to about £100 just in case.

If you reduce it and then have to pay tax, then they will charge you interest on that amount. For that reason, they are unlikely to get pissy with you.

[Maslins]

It's all pretty straight forward.

If you reduce them a lot then end up with a big liability, you'll have interest to pay...and potentially penalties if HMRC believe you knew full well you were reducing the account payments too much, but I've never seen a penalty issued.

[MrMarkyMark]

Evening all. Last year was a bit of an exception for me as I drew out an unusually large amount of divvies for my house deposit and then unexpectedly got a nice permie job offer which means I owe a reasonable chunk of tax for 15-16. That's not an issue - I knew it was coming and put some aside. My "issue" is the Payment on Account for next year - I thought PoA was 50% of this year, so was just going to suck it up, but it's 50% each payment meaning I'm about to give a whole chunk of cash to the tax man.

I left that employment and came back to contract and I'm actually now in the opposite boat - I've paid so much PAYE tax this far that I'm very unlikely to owe much tax next year - especially as I'm trying to build the company reserves back up.

I know I'll eventually get a refund, but I live by the "Always easier to negotiate when the money's in YOUR pocket" motto, and I'd rather like to not hand it over at all.

I noticed that on the SA I can put in a request for an adjustment (And, yes, I've literally just asked my accountant about it) but I was just after any related anecdotes people have. Do they get pissy about it, give you the benefit of the doubt?

In a similar situation and got my accountant to advise on the ultimate amount to reduce it to and the "right" amount of dividends to ensure this amount doe not generate interest next year.

[TheCyclingProgrammer]

Did it last year. My calculations were about £20 out (some interest I forgot about) so I just paid the underpayment once I submitted my SA. What happens is some of your second payment on account will be allocated to the first one, leaving the underpayment on the second payment on account.