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Time to Consider, Time to Pay HMRC

Time to Consider, Time to Pay HMRC

When discussing tax, it’s difficult to resist making a reference to the ‘two certainties’ in life, one of which is paying tax and the other even more unfortunate!

If, for now, we concern ourselves with the former – why is it that the Treasury still suffers from outstanding tax liabilities, year on year? The simple answer is – tax payers don’t always pay!


This is not a reference to individuals who seek to legally avoid liability, but to those entities, be they personal or legal, that have an outstanding bill. The question arises – is it that they just won’t pay or is it that they simply can’t?


Despite previous attempts to make the tax collection system more efficient, it’s not that straight forward. For anyone who has owned a business, be it big or small, the one thing they would likely agree on is the difficulties with cash flow. However premeditated a business plan, something can always go wrong, throwing a bank balance into turmoil.

Dealing with HMRC in such times of difficulty might seem like a daunting prospect, however, there is some provision made by HMRC for a tax payer who cannot meet a liability. At their discretion, and in certain limited circumstances, tax payers are granted ‘Time to Pay’.

This provision is not an automatic right and is really designed for debts that have not become due. In other words, a fixed payment is agreed with HMRC in lieu of the debt, which is then maintained for a certain period until the liability is met.

In addition, it has to be established that an entity can’t pay, rather than won’t. This is not always easy for individuals to admit to when the whole revenue system is premeditated with information on rates, allowances and reliefs made readily available, together with plenty of guidance for businesses from inception onwards, be it free or not.

There are further complications too; an agreement may be considered temporary, particularly if conducted verbally, and there have also been instances where paperwork was lacking and, despite the original communication(s), the Tax Payer was ordered to pay the debt in full.


Anyone seeking a ‘Time to Pay’ arrangement must prove that the liability simply cannot be met and explain the circumstances surrounding this turn of events. However, even if an arrangement is forged, there is still the risk of confusion when dealing with such a large government department whom have a complex and difficult task in organising everybody’s tax affairs.


Clearly the best course of action is to pay your tax on time, however if you do find yourself in a situation where you are struggling to pay your taxes, then it’s wise to seek the support of a third party who can arbitrate and provide confirmation, where appropriate.

Some might say that if you find yourself ‘Dancing with the Devil’ it would be advisable to speak with someone who recognises the tune!

Here at TaxDebts we specialise in helping our clients stay abreast of their tax affairs by supporting them through their ‘Time to Pay’ arrangement. Give us a call on 08000 886 129 or visit www.taxdebts.co.uk to find out more.

Written by Jason McClean LLB

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