HMRC Time to Pay Arrangements: Complete Guide for UK Businesses
Everything you need to know about HMRC Time to Pay arrangements,
including eligibility criteria, application process, and what to do if
your application is rejected.
10 min read
Tax Advisory Team
Quick Overview
HMRC Time to Pay arrangements allow businesses to spread tax payments
over an agreed period, typically 3-12 months. This can provide crucial
breathing space for businesses experiencing temporary cash flow
difficulties.
Typical Duration
3-12 months
Interest Rate
2.6% per annum (2024)
Application
Online or by phone
What is a Time to Pay Arrangement?
A Time to Pay (TTP) arrangement is an agreement with HMRC that allows
you to pay your tax debt in instalments over an agreed period. This
can cover various types of tax including VAT, PAYE, National Insurance
contributions, Corporation Tax, and Self Assessment tax.
Types of Tax Covered
Business Taxes
-
VAT (Value Added Tax)
-
PAYE (Pay As You Earn)
-
National Insurance contributions
-
Corporation Tax
Other Taxes
-
Self Assessment Income Tax
-
Construction Industry Scheme (CIS)
-
Stamp Duty Land Tax
-
Inheritance Tax
Eligibility Criteria
HMRC will consider your application for a Time to Pay arrangement
based on several factors. Meeting these criteria doesn't guarantee
approval, but it significantly improves your chances.
What HMRC Looks For
-
Temporary financial difficulties (not permanent
insolvency)
-
Up-to-date with current tax obligations
-
Realistic repayment proposal
-
Good compliance history
-
Ability to maintain future payments
What May Harm Your Application
-
History of broken payment arrangements
-
Outstanding returns or late filings
-
Evidence of phoenixing or asset stripping
-
Unrealistic repayment proposals
-
Signs of permanent insolvency
How to Apply: Step-by-Step Process
1
Prepare Your Financial Information
Gather comprehensive financial information including cash flow
forecasts, bank statements, and details of your current
financial position.
Documents You'll Need:
- • Recent management accounts
- • Cash flow forecasts for next 12 months
- • Bank statements (last 3 months)
- • Details of other creditors and payment arrangements
- • Explanation of financial difficulties
2
Choose Your Application Method
You can apply online through your HMRC business tax account or
by calling the Business Payment Support Service.
Online Application
Available for debts up to £30,000 and payment periods up to
12 months
Phone Application
Required for larger debts or longer payment periods
3
Submit Your Proposal
Provide a realistic repayment schedule based on your cash flow
projections. Be honest about your financial situation and
demonstrate how you'll maintain future tax obligations.
4
Await HMRC's Decision
HMRC will review your application and may request additional
information. They typically respond within 10 working days for
online applications.
HMRC Contact Numbers
Business Payment Support Service
📞 0300 200 3835
🕒 Monday to Friday: 8am to 6pm
💬 Welsh language: 0300 200 1900
Self Assessment Payment Helpline
📞 0300 200 3822
🕒 Monday to Friday: 8am to 6pm
💬 Automated service available 24/7
What Happens If Your Application is Rejected?
If HMRC rejects your Time to Pay application, don't panic. There are
several options available, and rejection doesn't mean the end of the
road.
1. Request a Review
You can ask HMRC to review their decision, especially if you have
additional information or if circumstances have changed.
- • Provide additional financial information
- • Explain any changes in circumstances
- • Offer a revised payment proposal
2. Negotiate Alternative Arrangements
Even if a formal TTP is rejected, HMRC may still be willing to
discuss alternative payment arrangements.
- • Shorter payment periods
- • Higher monthly payments
- • Security or guarantees
3. Seek Professional Help
Professional advisors can often negotiate more effectively with
HMRC and explore alternative solutions.
- • Insolvency practitioners
- • Tax advisors
- • Business recovery specialists
Alternatives to Time to Pay Arrangements
If a Time to Pay arrangement isn't suitable or available, there are
other options to consider for dealing with HMRC debt.
Formal Insolvency Procedures
-
Company Voluntary Arrangement (CVA)
-
Administration
-
Liquidation (as last resort)
Other Options
-
Asset refinancing or sales
-
Business restructuring
-
Third-party funding
Important Tips for Success
Do:
- ✅ Be honest about your financial situation
- ✅ Provide realistic repayment proposals
- ✅ Keep up with current tax obligations
- ✅ Maintain regular communication with HMRC
- ✅ Seek professional advice early
Don't:
- ❌ Ignore HMRC correspondence
- ❌ Make unrealistic promises
- ❌ Fall behind on agreed payments
- ❌ Hide assets or income
- ❌ Wait until enforcement action starts
Struggling with HMRC Debt?
Our experienced team can help you navigate HMRC negotiations and
explore all available options for resolving your tax debt.