How to manage January’s tax deadline stress

As the self-assessment tax deadline looms on January 31, many individuals are feeling anxious about paying their tax bills.

However, Ben Finch, an accountant at The Fresh Accountancy Company in Exeter, has a reassuring message: “Those worried about paying their tax bills this January shouldn’t panic.”

Ben highlights the importance of acting quickly if the bill is higher than expected. “The worst thing you can do is ignore the issue. If you’re struggling to pay in full, take action early – there are options available,” he says.

The first step, Ben advises, is to contact HMRC directly. “They may discuss extending the payment deadline or suggest making a partial payment before 31 January to demonstrate your intention of paying the liability,” he explains.

For longer-term support, HMRC’s Time to Pay (TTP) arrangement allows taxpayers to spread their bills over manageable monthly instalments. However, Ben warns, “You must stick to the agreed schedule – missing a payment will void the arrangement. Additionally, you’ll still need to pay ongoing tax obligations, such as VAT or PAYE, on time.”

While these measures can offer relief, Ben stresses that preparation is always better. “Requesting monthly or quarterly management accounts from your accountant will provide an estimate of your tax liability throughout the year. This foresight makes it easier to budget and save in advance,” he says.

For self-employed individuals, saving regularly is key. Ben advises looking at income and outgoings to estimate profit and then saving a percentage monthly. “If you then save 20 percent of this in a separate account each month it will help cover your tax bill due for that year and lessen your anxiety as the January deadline approaches,” he suggests.

For basic rate taxpayers, this approach - combined with the personal allowance of £12,750 – often covers the tax bill in full. Meanwhile, higher rate taxpayers can significantly reduce their lump sum burden.

“Paying tax reflects your success – it’s the price of profit,” says Ben. “By staying proactive and prepared, you can reduce financial stress and ensure you meet your obligations with ease.”

Ben concludes that by planning ahead, seeking professional advice, and contacting HMRC when needed, taxpayers can make January’s deadline far less stressful. For tailored guidance, he recommends speaking to an accountant or reaching out to HMRC directly.

The Fresh Accountancy Company, based in Clyst St Mary near Exeter, supports local businesses with services such as bookkeeping, tax planning, and virtual finance direction. Their fixed-fee model and “no win, no fee” tax planning aim to simplify financial management.