Averaging: postponement of payment of tax and interest
If an individual making an averaging claim applies to postpone payment of tax for the first year covered by the claim on the grounds that the profits for the first year are higher than for the second year, you should point out that averaging does not in fact alter the tax due for the earlier year (see BIM84145).
Where, however, the individual is required to make payments on account of Income Tax for the second year based on the tax on the profits for the first year, the individual may be able to make a claim to reduce the payments on account. See SALF303.
If averaging results in a repayment, any repayment interest that may be due is calculated by reference to the later year. The online SA Manual chapter elaborates on this at SAM110070.