HMRC Time To Pay

HMRC Time To Pay

When a business experiences a cash flow problem, they often fall behind on are their taxes. As VAT and PAYE are the taxes businesses pay the most frequently, they’re the ones that catch companies out.

To help, HMRC offer the “Time To Pay” scheme.

This allows you to pay your taxes at a more manageable rate over an agreed period of time if your business is experiencing temporary financial troubles. This article will help explain how that system works and if it could apply to your business.

Individuals can take part in the “Time To Pay” scheme although this article will focus on what the scheme for businesses.


What is “Time To Pay”?

“Time To Pay” is the name of the HMRC scheme that helps taxpayers with payments they’re struggling to meet.

The scheme works by allowing you to pay your tax bills in monthly instalments, typically up to 12 months. If your business circumstances dictate that a longer period of time is needed, that can also be worked out with the taxman but it may prove slightly more difficult.

The earlier you contact HMRC about a problem you may have in the future, the more likely they are to agree. In addition, with a “Time To Pay” arrangement in place, you will be shielded from penalties related to late payment as long as you keep to your payment schedule.

You are also more likely to be able to negotiate a “Time To Pay” agreement if you have a good history with HMRC. If you have previously paid all of your bills on time and have never been found guilty of evading or avoiding taxes by HMRC or the courts before, your case will be considered much more favourably.

You arrange a “Time To Pay” by contacting HMRC directly.


Before you contact HMRC

There are a few things that HMRC will want to know before deciding whether or not to give you a “Time To Pay” plan. Here is a list of things to have prepared before you call. You will need to know:

  • your reference number (for example, your 10-digit Unique Taxpayer Reference or VAT reference number),
  • the amount of the tax bill you’re finding it difficult to pay and the reasons why,
  • what you’ve done to try to get the money to pay the bill,
  • how much you can pay immediately and how long you may need to pay the rest,
  • your bank account details.

Having all of this information to hand and ready to share over the phone is essential. This will result in your being more likely in being granted “Time To Pay”.


Contacting HMRC

During the actual call, HMRC will ask you about your income and expenditure, your assets (like savings and investments), and the steps you are taking to get your taxes back into order.

They will then assess the long-term viability of your company, the probability of the “Time To Pay” plan being successful, and what might happen if you cannot keep to the plan.

The likelihood of being granted additional “Time To Pay” is based on these guidelines:

  • How reasonable your proposal is in terms of paying back your taxes in instalments,
  • HMRC must be certain that you cannot meet the normal tax deadlines that are set out,
  • HMRC must see that you are not looking to use the money elsewhere, such as expansions,
  • The “risk” involved with giving your company “Time To Pay”, the greater the perceived “risk”, the more they will need to know in order to help you.

The interviewer will then inform you of your rights and what penalties may be placed upon you if you fail to keep to the plan.


We can help

At SMART TEAM we can help you in preparing everything you need to increase your chances in getting a “Time To Pay” plan. Our expert team is only one call away on 01202 577 500 or you can email  for any help and advice you may need.

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