Tax Planning
Timely Payments through PAYE: What Self Assessment Taxpayers Need to Know by 2029
From April 2029, individuals with both PAYE and Self Assessment income will begin paying their tax more regularly—through PAYE—rather than waiting to settle large bills at the end of the year.
By NomadicTax Research Team • 5-8 min read • September 1, 2026
## Introducing PAYE Collection for Self Assessment Liabilities
Starting **April 2029**, HMRC plans to require Self Assessment taxpayers who also have PAYE (Pay As You Earn) income—for example from employment or pensions—to contribute towards their Self Assessment tax liabilities through their PAYE income. This change is intended to transform how tax is paid, easing financial burden and improving collection efficiency. ([gov.uk](https://www.gov.uk/government/publications/fiscal-events-2026-factsheets/timely-payments-in-income-tax-self-assessment-factsheet?utm_source=openai))
## Why This Matters
* **Budgeting becomes easier.** Regular deductions through PAYE mean less likelihood of facing a large unexpected payment in January.
* **Penalties and interest reduced.** Late payments can result in extra costs; spreading payments helps manage exposure. ([gov.uk](https://www.gov.uk/government/publications/fiscal-events-2026-factsheets/timely-payments-in-income-tax-self-assessment-factsheet?utm_source=openai))
* **Support for those with fluctuating income.** Although most will see no change in total tax paid, provisions will be made for those whose income varies widely (freelancers, contractors, etc.).
## Who Will Be Affected
Affected taxpayers will include those who:
- Have Self Assessment income in addition to PAYE income;
- Earn enough through PAYE to see tax code adjustments;
- Currently make two “payments on account” (in January and July) in arrears, followed by a balancing payment. ([gov.uk](https://www.gov.uk/government/publications/fiscal-events-2026-factsheets/timely-payments-in-income-tax-self-assessment-factsheet?utm_source=openai))
If you have **only Self Assessment income**, you won’t be required to pay through PAYE, but HMRC is considering extending reforms broadly. Consultations are underway. ([gov.uk](https://www.gov.uk/government/publications/fiscal-events-2026-factsheets/timely-payments-in-income-tax-self-assessment-factsheet?utm_source=openai))
## Action Steps Before 2029
1. Review your previous year's tax return to see if PAYE income is sufficient for potential deductions.
2. Maintain accurate forecasts of your total income—including Self Assessment elements—to help with HMRC’s expectations and adjustments.
3. Keep in communication with your accountant or tax adviser to monitor how PAYE codes might change.
4. Participate in consultations or provide feedback when HMRC seeks input, especially if you have variable income streams. ([gov.uk](https://www.gov.uk/government/publications/fiscal-events-2026-factsheets/timely-payments-in-income-tax-self-assessment-factsheet?utm_source=openai))
## Example Scenario
**Sam** works full-time under PAYE and runs a small side business. Currently, Sam submits a Self Assessment return each January and makes two payments in advance (Jan & July), followed by a balancing payment. Under the new regime:
- Some Self Assessment tax could be collected through her PAYE tax code throughout the year.
- Her January and July payments on account may reduce or change based on how much PAYE tax she already pays.
- Her balancing payment due in January could be significantly smaller—if income forecasts and PAYE coding align closely with what she actually earns.
## FAQ
| Question | Answer |
|---|---|
| Will I end up paying **more tax overall**? | No. The reforms change timing, not total tax liability. The aggregate amount due remains the same. ([gov.uk](https://www.gov.uk/government/publications/fiscal-events-2026-factsheets/timely-payments-in-income-tax-self-assessment-factsheet?utm_source=openai)) |
| What if my Self Assessment income is unpredictable? | HMRC will allow forecasts to be submitted and will build in flexibility. Safeguards are part of the consultation. ([gov.uk](https://www.gov.uk/government/publications/fiscal-events-2026-factsheets/timely-payments-in-income-tax-self-assessment-factsheet?utm_source=openai)) |
| How will this interact with **Making Tax Digital (MTD)**? | They complement each other. MTD enhances record keeping and real-time reporting; PAYE collection smooths payments. |
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By starting to plan now—tracking income, forecasting carefully, and knowing the reform timeline—taxpayers can avoid surprises and benefit from more manageable payment schedules when the change comes in April 2029. Reach out to your tax adviser for personal guidance.