Agreeing a time to pay (TTP) arrangement used to involve calling HMRC and convincing it that you were struggling to pay. Agreement was often made grudgingly. This stance has softened in recent years, and there may be no need to make a call at all. What do you need to know?
TTP arrangements are informal agreements between the taxpayer and HMRC in situations where the self-assessment bill can’t be paid in full by the deadline. Instead, the TTP arrangement allows the bill to be spread across monthly instalments by direct debit. Previously, TTP arrangements could only be set up by calling the self-assessment helpline, explaining the circumstances, and making a case for it. Taxpayers would often find HMRC reluctant to agree a payment period of more than a few months. The advent of the pandemic and the cost of living crisis has changed this, and HMRC made it much easier.
It's now possible to set up a TTP arrangement online with no need to make a call. This will be possible if you:
have filed your tax return
are within 60 days of the payment deadline
owe less than £30,000; and
can pay in full within twelve months.
Guidance on how to set this up is available online. Note that late payment interest will be charged, but no late payment penalties. As interest rates are steadily increasing, paying sooner rather than later is recommended wherever possible.
It's also come to our attention that the new HMRC app, which is available in the play store and app store, has a TTP facility baked in. Download the app, the log in with your government gateway, click self-assessment and then tap "set up a payment plan".
Feel free to contact us if you need any further information.