Time to pay HMRC

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Arranging a Time to Pay with HMRC?

Establishing a time to pay with HMRC, especially during the current pandemic, can be crucial to the survival of your business.

HMRC Time to Pay helpline:

0300 200 3822

You must arrange to pay your tax bill with HMRC if you either:

  • Have missed a payment or
  • Know you cannot pay on time.

However, if your limited company is unable to pay your taxes as due, you may consider contacting HMRC to agree on a time to pay your outstanding tax. A Time to Pay arrangement is a repayment plan that allows you to pay taxes over a set period in arrears. Agreed by HMRC with you for either yourself or your limited company.

Defaulting payment of Time to Pay?

However, you must ensure that you keep your agreed payments along with other taxes. Failure to do so will then prompt HMRC to cancel the arrangement and commence legal action immediately to recover the outstanding amount.

If you cannot pay due to the Coronavirus (COVID-19) pandemic,

Before contacting HMRC, be prepared:

You’ll need to therefore 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.

Which HMRC debts to then prioritise: 

HMRC is more inclined to consider agreeing to pay for profits based taxes, like

  • Income tax and 
  • Corporation tax 

Then for taxes, including: 

  • VAT and 
  • Employees’ PAYE and national insurance contributions.

Usually, best to prioritise paying VAT and employer liabilities. However, an updated direction awaited.

Arranging a Time to Pay with HMRC and late payment penalties 

The advantage of a formal payment time is that HMRC will not charge late payment penalties if the payment time is in place at the trigger date for penalties. However, it remains unclear whether HMRC will be more prepared to forgo penalties for late payment during the current Coronavirus pandemic, although the helpline page indicates HMRC will investigate the cancellation of penalties.

Arranging a Time to Pay with HMRC, and what happens when you contact HMRC?

HMRC Time to Pay helpline – 0300 200 3822

HMRC will however ask you about:

Your income and expenditure;

  • Details of assets;
  • What you’re doing to get your tax payments up to date?

HMRC will decide whether you should pay immediately. However, if you cannot, they’ll decide whether you’ll get your payments back on track with more time.

You’ll be asked more in-depth questions if you’ve been given more time to pay before. In more complex cases, HMRC may however require evidence before they make a decision.

HMRC time to pay agreements requires future tax liabilities to be paid in full, as they fall due. Where this is impossible, it is then necessary to contact HMRC again to renegotiate the arrangement to include the new debt. HMRC is often disinclined to agree repeated appeals for time to pay, but during the Coronavirus COVID-19 pandemic may be more receptive to further arrangement.

Arranging a Time to Pay with HMRC and being refused?

Can’t pay VAT options

Company can’t pay PAYE To HMRC

What does business recovery mean?

Tax Avoidance Schemes and penalties.

Help from HMRC

You may seek further help by the following link: contact HMRC.

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