Let’s rewind. During the pandemic, the government offered a “tax deferral” scheme. A lot of self-employed people took it, thinking, “Great, I’ll pay later!” Well, “later” is now. And that later also comes with interest charges. Interest on your unpaid tax, at a rate that’s higher than your mortgage. Fun, right?
New support for Small Business from HMRC
Plus, HMRC’s own calculations show that many freelancers underestimated their earnings on their tax returns. Oops. So now they’re underpaying their taxes, and the bills are catching up like a zombie in a horror flick. Slow, inevitable, and hungry for your cash.
What Can You Actually Do? (Besides Panic)
First, breathe. You’re not the first freelancer to forget about the “payment on account” trap. Second, don’t ignore it. HMRC is actually offering a “Time to Pay” arrangement if you can’t pay the full bill. You can spread the cost over up to 12 months. Yes, it’s not ideal—interest still applies—but it beats the penalty hammer.
Another trick: File your tax return early, even if you can’t pay it all at once. The deadline to file is January 31st, but if you file in October or November, you know exactly what you owe. Then you can set up a payment plan with HMRC before the chaos. (Pro tip: they’re way nicer in November than in February. Trust me.)
Oh, and stop ignoring those “set aside 25%” apps. Seriously. Use a separate bank account for your tax money. Treat it like a vampire—it doesn’t exist until you need it.
HMRC Tax Webinars Jan-Feb 2026: Self-Assessment & Compliance
