Question 1

Marcus, a freelance graphic designer, had an income tax and Class 4 NIC liability of £6,000 for the tax year 2022/23. His total liability for 2023/24 is £7,500. Assuming he made the required payments on account on time, what is the balancing payment due on 31 January 2025 for the 2023/24 tax year?

Accepted Answer

Calculate the payments on account made (50% of previous year's liability each). Subtract the total payments on account from the current year's liability to find the balancing payment.

Question 2

What mistakes do candidates make on this ACCA question?

Accepted Answer

Confusing the balancing payment for 23/24 with the first payment on account for 24/25.

Marcus, a freelance graphic designer, had an income tax and Class 4 NIC liability of £6,000 for the tax year 2022/23. His total liability for 2023/24 is £7,500. Assuming he made the required payments on account on time, what is the balancing payment due on 31 January 2025 for the 2023/24 tax year?

How to approach this question

Full Answer

Common mistakes

Practice the full ACCA TX — Taxation Practice Exam 6

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