Time to pay tax arrangements go online

HMRC has modernised time to pay arrangements for taxpayers who are unable to pay their bills allowing them to renegotiate everything online rather than talking to HMRC

For anyone with a self assessment payment due by 31 January, it is now possible to set up a time to pay arrangement, subject to electronic approval, solely online without contacting HMRC.

If an instalment plan for direct debit payments is agreed with HMRC then there will be no charge for any late payment penalties or surcharges from the time that the agreement is in place, provided taxpayers keep to the arrangement.

However, interest will be charged on any payment made after the deadline – currently at 3.25% per annum.

If taxpayers agree an instalment plan with HMRC then they will not be charged any late payment penalties or surcharges from the time that the agreement is in place, provided they keep to the arrangement.

People will only be able to use this service once they have missed the payment deadline – to make a payment arrangement before the self assessment deadline taxpayers will have to contact HMRC’s Payment Support Service.

This would give until the end of February 2020 for a 2018-19 tax return bill, due on 31 January 2020.

Dawn Register, partner in tax dispute resolution at BDO, said: ‘If you are experiencing cashflow difficulties you can contact HMRC to formally defer payment, commonly known as a time to pay agreement.

‘HMRC published updated guidance on 20 January 2020 which in HMRC says it will provide “extra, bespoke support to people facing financial hardship or in personal difficulty”.

‘This appears to be a softening of language and approach, probably in response to recent criticisms under the loan charge debacle. HMRC states that “90% of our time to pay arrangements complete successfully”.’

Self assessment payment helpline: 0300 200 3822

Time to pay arrangements for individual taxpayers clarified

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