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HMRC ‘Time to Pay’ advice


    It’s easy to find yourself in HMRC arrears, and is often a sign that you personal or business situation is experiencing a period of difficulty.

    Since 2008, businesses have been given unexpected levels of support through difficult times by HMRC.

    HMRC has been working hard to support businesses in recent years, agreeing to £3.1bn in deferred payments, of which £2bn had been paid back in under half a year, and 177,000 companies entering into ‘Time to Pay Programmes’.

    Time to Pay Programmes arrange for the deferral of PAYE, VAT, National Insurance and Corporation tax.

    The Time to Pay Programmes offer a service that can be accessed by companies which are ‘genuinely unable to pay’ and if the tax owed is on previous year’s profits or if a trading loss in the current year is a strong probability.

    Companies experiencing cash-flow problems are offered help through the government’s Business Payment Support Service (BPSS).

    Business Payment Support Service

    The HMRC’s Business Payment Support Service provides help and assistance to companies that are struggling to make their tax contributions in full and on time.

    If you have received a demand or a letter from HMRC warning that legal action may be taken against you or your business, you must contact the HMRC office that issued to correspondence immediately.

    The Business Payment Support Service will guide you through what you need to do if you fear that payments won’t be made on time or in full. Since November 2009, it’s been much more difficult to arrange a Time to Pay Programme with HMRC.

    Additionally, it should be noted that the HMRC should not be treated lightly when making tax contributions, as 40% of winding up petitions are created by the HMRC.

    Tips on Time to Pay Programmes

    • When trying to reach a Time to Pay Programme agreement, make a note of the name and telephone number of the person you’re dealing with. Write a letter, noting what you discussed and agreed with them.
    • Keeping a record of discussions may become useful if negotiations are long and drawn out.
      Be honest and clear in explaining your business issues.
    • Make them an offer of a proposed payment plan and be sure that you can maintain it.
    • Reinforce your ability to maintain the payment plan by including a cash flow forecast.
    • Always submit PAYE/NI and VAT returns as it will help HMRC to understand your liability. Failure to submit your returns may make the situation worse.
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