The second payment on account for 2025/26 fell due on 31 July 2026. If you paid it, nothing here needs your attention. If you didn't, the cost is smaller than most dentists fear and the fix has a deadline.
Article · 21 July 2026
The second payment on account for the 2025/26 tax year fell due on 31 July 2026. It is the instalment most people lose track of, because nothing new happened to prompt it: no fresh invoice, no reminder letter for most taxpayers — just a standing instruction quietly coming due six months after the January one.
If it went out on time, you can stop reading. If it didn't, the useful questions are what it costs, whether a penalty is coming, and what to do before the window for fixing it closes.
Payments on account are advance instalments towards the current year's tax, each one normally half of your previous year's bill. The 31 July 2026 payment was the second instalment for 2025/26, calculated from the liability on your 2024/25 return. The first instalment went on 31 January 2026, alongside the balancing payment for 2024/25 — which is why January feels so much heavier than July.
They apply if your last bill exceeded £1,000 and less than 80% of your tax was collected at source. That description fits most self-employed dentists exactly: associates paid gross by the practice, locums working across several sites, and sole-trader principals. A dentist on PAYE rarely sees one at all — so if you moved from employment to an associate post, or incorporated and then unwound it, this may be the first July it applied to you, and it arrived without warning. The same is true in your second year as an associate, which is where the arithmetic is set out in full in our first-year associate guide.
Interest, and only interest, running from 1 August. HMRC's late payment rate is the Bank of England base rate plus 4 percentage points, which has been 7.75% since 9 January 2026; the base rate was held at 3.75% on 30 July 2026, so that is the rate now running.
Take an illustrative associate whose 2024/25 tax bill was £14,600. Each payment on account for 2025/26 is £7,300. Miss 31 July and pay on 21 September — 52 days late:
That is the whole cost. It is worth knowing the daily figure, because it changes how the decision feels: at £1.55 a day, spending three weeks worrying about it is more expensive in attention than in money — and paying it this week rather than next saves about £11.
This is the question dentists ask most, and the widely repeated answer is wrong. The automatic Self Assessment late payment penalties — 5% of the tax unpaid at 30 days, again at 6 months, and again at 12 months — attach to the balancing payment due on 31 January. They do not attach to a payment on account. A late instalment on 31 July attracts interest and nothing else.
That is not permission to leave it. An unpaid payment on account does not disappear: it sits on your account, accrues interest daily, and forms part of what is outstanding when the balancing payment for 2025/26 falls due on 31 January 2027. From that date the 5% penalties do apply to what remains unpaid. In other words, the free pass is on the instalment itself, and it expires in January.
If your income genuinely dropped — parental leave, a career break, fewer sessions, a move from NHS to private with a slower ramp — you can claim to reduce both instalments through your HMRC account or on form SA303. For 2025/26, that claim can be made up to 31 January 2027.
Reduce too far and HMRC charges interest on the shortfall from the original due date. Suppose the same associate reduced each instalment from £7,300 to £4,000 on the strength of a quiet-feeling year, and the year turned out to justify the full amount. The shortfall on the July payment is £3,300, and interest runs from 31 July 2026 to 31 January 2027 — 184 days:
Put plainly: the reduction kept £3,300 in your account for six months and cost £128.93. That is an unsecured loan from HMRC at 7.75%, and against a business overdraft it is not a bad one. The trap is not the interest — it is not realising you have borrowed. Reductions should be made against an actual forecast of the year, not a feeling that things were quieter, and with the interest priced in deliberately rather than discovered in January.
HMRC's online Self Assessment payment plan covers debts of up to £30,000, and you must set it up within 60 days of the payment deadline — for the 31 July 2026 instalment, that is 29 September 2026. Your returns need to be up to date, you need a UK bank account you are authorised to set up a Direct Debit on, and interest continues to run on the balance. Above £30,000, or for a longer period, you can still apply but you have to telephone HMRC. Doing this inside the window is straightforward; doing it afterwards means a conversation instead of a web form.
We calculate and confirm both payments on account for every self-employed client well ahead of each deadline, so 31 July is a number already in the diary rather than a surprise. The wider picture of how self-employed dental tax fits together is in our associate tax guide.
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Not an automatic one. The 5% Self Assessment late payment penalties charged at 30 days, six months and twelve months attach to the balancing payment due on 31 January, not to a payment on account. A late July instalment attracts interest only, currently 7.75% a year. That is genuinely different from being fined, but it is not a free pass: the unpaid instalment stays on your account accruing interest daily, and it forms part of what is outstanding on 31 January 2027, when the 5% penalties do start to apply to whatever remains unpaid. Clear it before then and no penalty ever arises.
Less than most dentists fear, and it is worth doing the sum rather than worrying. HMRC's late payment rate is the Bank of England base rate plus four percentage points, which has been 7.75% since 9 January 2026. On a £7,300 instalment that is £565.75 a year, or £1.55 a day. Paying 52 days late — 31 July to 21 September — costs £80.60. Knowing the daily figure makes the decision rational: it tells you what delay is actually buying, and it usually shows that paying this week rather than next month is worth doing but not worth losing sleep over.
Yes. For the 2025/26 tax year the claim to reduce can be made up to 31 January 2027, through your HMRC online account or on form SA303, and it reduces both instalments. The condition is that your liability for 2025/26 will genuinely be lower than 2024/25 — parental leave, reduced sessions, a career break, a move that slowed your income. If you reduce below what the year turns out to justify, HMRC charges interest on the shortfall back to the original due date. Base the claim on a real forecast of the year rather than an impression of how busy it felt.
Because two different things were paid in January. The balancing payment settled the tax year that had ended; the first payment on account was an advance instalment towards the year you were in the middle of. The 31 July payment is simply the second half of that advance. They apply whenever your last bill exceeded £1,000 and less than 80% of your tax was collected at source, which describes almost every self-employed dentist. The upside is that once the cycle is established you are paying tax closer to when you earn it, and January stops being a cliff.
Set up a payment plan rather than going quiet. HMRC's online Self Assessment plan covers up to £30,000 and has to be arranged within 60 days of the payment deadline, so for the 31 July 2026 instalment the window closes on 29 September 2026. You need your returns up to date and a UK bank account you can authorise a Direct Debit on, and interest continues on the balance while you pay it down. Above £30,000, or if you need longer, you can still apply but it means telephoning HMRC rather than using the online service.
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