Section 59A: Payments on account of income tax., Taxes Management Act 1970

Subject to subsection (9) below, this section applies to any person (the taxpayer) as regards a year of assessment if as regards the immediately preceding year—

he is assessed to income tax under section 9 of this Act in any amount, and

that amount (the assessed amount) exceeds the amount of any income tax which has been deducted at source, and

the amount of the excess (the relevant amount) is not less than such amount as may be prescribed by regulations made by the Board, and

the proportion which the relevant amount bears to the assessed amount is not less than such proportion as may be so prescribed.

Subject to subsection (3) below, the taxpayer shall make two payments on account of his liability to income tax for the year of assessment—

the first on or before the 31st January in that year, and

the second on or before the next following 31st July;

and, subject to subsections (4) to (4B) below, each of those payments on account shall be of an amount equal to 50 per cent. of the relevant amount.

If, at any time before the 31st January next following the year of assessment, the taxpayer makes a claim under this subsection stating—

his belief that he will not be assessed to income tax for that year, or that the amount in which he will be so assessed will not exceed the amount of income tax deducted at source, and

his grounds for that belief,

each of the payments on account shall not be, and shall be deemed never to have been, required to be made.

If, at any time before the 31st January next following the year of assessment, the taxpayer makes a claim under this subsection stating—

his belief that the amount in which he will be assessed to income tax for that year will exceed the amount of income tax deducted at source by a stated amount which is less than the relevant amount, and

his grounds for that belief,

the amount of each of the payments on account required to be made shall be, and shall be deemed always to have been, equal to 50 per cent. of the stated amount.

If as regards the year immediately preceding the year of assessment—

the taxpayer is assessed to income tax under section 9 of this Act after the date on or before which either payment on account is required to be made, or

his assessment to income tax under that section is amended after that date,

then, subject to subsections (3) and (4) above and subsection (4B) below and to any subsequent application of this subsection, the amount of the payment on account shall be, and shall be deemed always to have been, equal to 50 per cent. of the relevant amount as determined on the basis of the assessment or, as the case may be, the assessment as amended.

If as regards the year immediately preceding the year of assessment the taxpayer is assessed to income tax under section 29 of this Act in any amount, then, subject to subsections (3) and (4) above and to any subsequent application of this subsection, the amount of each payment on account shall be, and shall be deemed always to have been, the total of—

the amount which, immediately before the making of the assessment under section 29, is the amount of that payment, and

an amount equal to 50 per cent. of the amount in which he is assessed under that assessment;

and if that assessment is varied, the amount in which he is assessed under it shall be taken for the purposes of paragraph (b) above to be the amount of the assessment as varied.

Where the taxpayer makes a claim under subsection (3) or (4) above or subsection (4A) or (4B) above applies, there shall be made all such adjustments, whether by the repayment of amounts paid on account, by the making of payments or further payments on account or otherwise, as may be required to give effect to the provisions of that subsection.

Where the taxpayer fraudulently or negligently makes any incorrect statement in connection with a claim under subsection (3) or (4) above, he shall be liable to a penalty not exceeding the difference between—

the amount which would have been payable on account if he had made a correct statement, and

the amount of the payment on account (if any) made by him.

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In this section, in relation to a year of assessment, any reference to the amount of any income tax deducted at source is a reference to the amount by which the aggregate of the following, namely—

any income tax deducted or treated as deducted from any income, or treated as paid on any income, in respect of the year, and

any amounts which, in respect of the year, are to be deducted at source under PAYE regulations in subsequent years, ...

exceeds the aggregate of any amounts which, in the year, are deducted at source under PAYE regulations in respect of previous years.

If, at any time before the 31st January next following a year of assessment, an officer of the Board so directs—

this section shall not apply, and shall be deemed never to have applied, as regards that year to any person specified in the direction; and

there shall be made all such adjustments, whether by the repayment of amounts paid on account or otherwise, as may be required to give effect to the direction.

PAYE regulations may provide that, for the purpose of determining the amount of any such excess as is mentioned in subsection (1) above, any necessary adjustments in respect of matters prescribed by the regulations shall be made to the amount of tax deducted at source under PAYE regulations.

Section 59A: Payments on account of income tax.

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