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ACCA Applied Skills · Taxation (UK)

Time Limits for Submitting Information, Claims and Paying Tax, Including Payments on Account

This chapter covers when UK taxpayers must file returns, make claims and pay tax. You solve questions by identifying the tax, the taxpayer and the period, then applying the correct date, payment on account rule, interest or penalty. Learn the dates as a table, then practise computing amounts due.

What this chapter covers

This chapter is about the administration of UK tax. It asks three questions: when must information be sent to HMRC, when can claims and elections be made, and when must the tax be paid. It covers income tax, corporation tax, capital gains tax, inheritance tax and VAT, so it touches every other part of the paper.

The content is mostly dates, periods and percentages, plus a few calculations. The key calculation is payments on account for an individual: two instalments, each normally half of the prior year's income tax liability, less tax deducted at source, with a balancing payment after the year end. You also compute interest and penalties using the rates ACCA gives you.

This chapter links to everything else. Once you have computed income tax, a chargeable gain, corporation tax or VAT, the next question is often when it is due and what happens if it is late. Questions are often a small part of a larger scenario, so you need the dates ready without looking for them.

Deadlines and penalties appear in all three sections of the exam. They are common in objective test questions, where one correct date or percentage earns the full two marks, and they often appear as a final part of a longer constructed response question. The content is factual and learnable, so it is one of the most reliable places to pick up marks if you practise recall, and one of the easiest places to lose them if you mix up dates between taxes.

The time limits for the submission of information, claims and payment of tax, including payments on account: topics in the order to study them

  1. 1Income Tax Filing Deadlines and Payments on AccountStart here because it is the most calculation-heavy topic and sets the pattern for filing, payment and interest in later topics.
  2. 2Interest and Penalties for Late Payment and FilingIt builds directly on the income tax dates and uses the interest rates and error penalty table ACCA provides.
  3. 3Corporation Tax Returns, Payment Dates and Quarterly InstalmentsLearn it next so you can compare company dates with the individual dates you already know.
  4. 4Claims, Elections and Record Keeping Time LimitsThese limits apply across taxes, and they make more sense once you know the main filing dates they are measured from.
  5. 5Capital Gains Tax and Inheritance Tax Payment and Reporting DatesThese are shorter sets of dates, and they are easier once the income tax payment date is fixed in your mind.
  6. 6VAT Returns, Payment Deadlines and Default PenaltiesVAT runs on its own return periods and penalty rules, so finish with it and keep it separate from the other taxes.

How to prepare The time limits for the submission of information, claims and payment of tax, including payments on account

Treat this chapter as a mix of a lookup table and a small set of calculations. Memorise the table, then practise the calculations until they are routine.

  1. Build one page with a row for each tax (income tax, corporation tax, CGT, IHT, VAT) and columns for filing date, payment date, and penalty or interest. Redraw it from memory until it is correct.
  2. Practise payments on account: work out the prior year liability, deduct tax collected at source, split into two equal instalments, and then compute the balancing payment. Learn the conditions under which no payments on account are required.
  3. Learn the rates from the tax rates and allowances ACCA gives you: interest on underpaid tax 8·50%, interest on overpaid tax 3·50%, VAT late payment bands, and the error penalty table. Practise reading them, not memorising them.
  4. Work through short objective test questions on dates and time limits, and write down why each wrong option is wrong. This shows you which dates you confuse.
  5. Practise a constructed response answer that includes a deadline, for example advising a client what is due and when. Give the date, the amount and the consequence of missing it.
  6. In the last week, recite the table aloud and redo any date you got wrong. Check that you use the right tax year and the right accounting period each time.

Common mistakes in The time limits for the submission of information, claims and payment of tax, including payments on account

    Last-day revision: The time limits for the submission of information, claims and payment of tax, including payments on account

    • Individuals: paper return by 31 October after the tax year, online return by 31 January after the tax year.
    • Income tax balancing payment is due on 31 January after the tax year. Other CGT is due on the same date, but gains on UK residential property must be reported and paid within 60 days of completion.
    • Payments on account: two equal instalments on 31 January in the tax year and 31 July after it, each normally 50% of last year's liability net of tax deducted at source.
    • No payments on account if last year's income tax liability net of tax deducted at source is below £1,000, or if more than 80% of last year's liability was met by tax deducted at source.
    • Interest rates given: 8·50% on underpaid tax and 3·50% on overpaid tax.
    • Error penalties: careless up to 30%, deliberate but not concealed up to 70%, deliberate and concealed up to 100%, with lower minimums for unprompted disclosure.
    • Companies: return due 12 months after the end of the period, tax due 9 months and 1 day after the end of the period.
    • Quarterly instalments apply to large companies with profits above £1,500,000, divided by 1 plus the number of associated companies. ACCA provides the £1,500,000 threshold. The rule that very large companies (profits over £20m, similarly divided) pay earlier is taught knowledge. The £20m figure is not in the rates ACCA provides, so learn it.
    • VAT late payment: no penalty up to 15 days, 3% for 16 to 30 days, 6% plus a daily penalty at an annual rate of 10% after 30 days.
    • CGT on UK residential property disposals must be reported and paid within 60 days of completion.
    • Inheritance tax on death is due six months after the end of the month of death. Taper relief reduces the death tax payable on chargeable lifetime transfers made more than three years but less than seven years before death. The reductions are: 3 to 4 years 20%, 4 to 5 years 40%, 5 to 6 years 60%, 6 to 7 years 80%.
    • Always check the rates and allowances ACCA gives you before using a number from memory.

    The time limits for the submission of information, claims and payment of tax, including payments on account practice questions

    The time limits for the submission of information, claims and payment of tax, including payments on account in other exams

    The same ground in other exams, if you are preparing for more than one or want another angle on it.

    The time limits for the submission of information, claims and payment of tax, including payments on account: frequently asked questions