Deadlines for Paying Self-Assessment Interest and How It Accrues

12 January 2026

If you are required to submit a Self-Assessment tax return in the UK and make a payment to HM Revenue & Customs (HMRC), it is important to understand the rules around late payments, particularly how interest is charged. Interest is applied automatically when tax is not paid by the deadline, and it is calculated on a daily basis from the day the payment is due.

The standard deadlines

The standard deadlines for Self-Assessment payments are 31 January for any tax owed for the previous tax year as well as the current year first payment on account, and 31 July for the second payment on account. If you miss these dates, HMRC will begin to accrue interest on the outstanding balance immediately. This interest is not a penalty but a charge for the time the tax has remained unpaid.

Interest accrues on a daily basis, meaning each day the balance remains unpaid, additional interest is added to the amount you owe. The rate of interest is set by HMRC and can change regularly. It is compounded daily, so the longer the delay in paying, the more the interest grows. For example, if you owe £1,000 and the current HMRC interest rate is 7.75% per year, the daily interest will be roughly £0.21, adding up quickly if the payment remains unpaid for weeks or months.

It’s also important to note that HMRC can charge interest even if you have made a partial payment. This means any outstanding amount continues to accrue interest until it is fully settled. Paying on time is therefore the simplest way to avoid unnecessary additional charges.

If you anticipate difficulty paying your Self-Assessment tax on time, it may be possible to arrange a Time to Pay agreement with HMRC. Doing so can reduce the burden of interest accumulation and avoid further penalties. Understanding how interest accrues ensures you can manage your finances and stay compliant with HMRC requirements.

For example

Consider an interest rate of 7.75% per year on a £1,000 unpaid balance. The daily interest would be approximately £0.21. Here’s a simple table showing how quickly interest adds up: