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Time To Pay Arrangement

Yinchao Zou

Time To Pay arrangement

What is a Time to Pay arrangement?

Businesses and self-employed people in financial distress, and with outstanding tax liabilities, may be eligible to receive support with their tax affairs through HMRC’s Time To Pay service.

These arrangements are agreed on a case-by-case basis and are tailored to individual circumstances and liabilities. Agreements reached with HMRC allow businesses and individuals to pay their debt by instalments over a period of time.

HMRC will usually offer taxpayers the option of extra time to pay if they think they genuinely cannot pay in full but will be able to pay in the future. If HMRC do not think that more time will help, then they can require immediate payment of a tax bill and start enforcement action if payment is not forthcoming.

An online payment plan for Self-Assessment tax bills can be used to set up instalment arrangements for paying tax liabilities up to £30,000. Taxpayers that qualify for a Time to Pay arrangement using the self-serve Time to Pay facility online, can do so without speaking to an HMRC adviser.

Taxpayers that want to use the online option must also meet the following requirements:

  • Have no outstanding tax returns
  • No other tax debts
  • No other HMRC payment plans set up
  • Plan to pay their debt off within the next 12 months or less.

Taxpayers with Self-Assessment tax payments that do not meet the above requirements and businesses need to contact HMRC to request a Time to Pay arrangement. HMRC has stated that over 90% of agreed Time to Pay Arrangements are completed successfully.

How assets are treated when we agree a Time to Pay Arrangement


If you have the means to pay your HMRC liabilities by realising assets (for example, savings, shares, or a second home) then we’ll discuss this with you.

If you have assets that both you and HMRC agree can be realised (including equity in a property), then we expect you to do so to reduce the debt as much as possible before we agree an arrangement.

We’ll not ask you to sell your family home. We may consider taking a charge on your home to secure the debt payable to HMRC if:

  • it’s not possible to agree a Time to Pay Arrangement with you
  • you’re not able to pay by any other means

We’ll not expect you to access pension funds early to pay your debt. If you receive a pension this will be taken into account as part of your income and expenditure position.


If your business can pay its HMRC liabilities by releasing assets, then we will discuss this with you. Assets can include:

  • stock
  • vehicles or shares
  • directors putting personal funds into the business
  • business lending
  • extending credit lines

If we agree with you that there are assets your business can release (including equity in a business property) then we would expect them to be used to reduce the debt as much as possible before we agree a Time to Pay Arrangement.

If you are looking at your accounts and thinking they need a professional touch, get in touch with us today and let us help you.


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