Time to Pay arrangement if you struggle to meet tax bills

15 September 2022

Time to Pay arrangement can be set up by both, individuals and businesses.

advice : Tax

Inflation is record high and the increasing cost of living indicates that many people may struggle to pay the tax they owe. What can you do about it?

Your tax bills are not going to magically disappear and ignoring the problem will make things worse. HMRC will eventually request their money and use various tools available to them to help them.

If you are struggling, the best take of action is to take the control of this situation. And rather than paying everything in one go, you may be able to pay in manageable instalments.

Setting up a Time to Pay arrangement 

If you are struggling to pay a self-assessment tax bill, you may be able to set up an instalment plan, also known as a Time to Pay arrangement online. A Time to Pay can be set up by both, individuals and businesses. To set it up, will need to log in to your Government Gateway account.

A Time to Pay agreement can be set up online if:

  • you have filed your latest tax return;
  • you owe less than £30,000;
  • you are within 60 days of the payment deadline; and
  • you plan to pay your debt off within the next 12 months or less.

More information on Time to Pay can be found on the official government website.

Information required for a Time to Pay arrangement

You will need certain information to set up your Time to Pay arrangement, including:

  • your unique tax reference (UTR) number;
  • your bank account details; and
  • details of any payments you have missed.

HMRC will ask you whether you can pay the full amount, how much you can repay each month, if you owe other taxes, how much you earn, what your monthly outgoings are and what savings and investments you have. If you have assets or savings, HMRC expects that you will use these to pay any tax you owe.

Stick to the plan

Once you have agreed to a Time to Pay arrangement, it is important that you make the payments in accordance with the plan. If you miss a payment, HMRC will normally contact you to find out why, and assist, where possible, to restore your plan. 

However, if you continue to fault, HMRC will seek to collect the debt in full. If further tax liabilities arise, that prevent you from payment, it may be possible to amend the plan to include new details.

Calling HMRC

If you can’t set up an instalment payment plan online, you can call HMRC’s Self-Assessment helpline to see if you can agree on one over the phone. Reasons for this could be, for example, because you owe more than £30,000 or need more time to pay your taxes. The Self-Assessment Payment Helpline number is 0300 200 3822 and the helpline is open from 8 AM to 6 PM from Monday to Friday.

Nothing on this page is intended to be or should be construed or taken as accountancy, investment, tax or any other kind of advice. We recommend individuals and companies seek professional advice on their circumstances and matters.