If you can't pay your tax bill in one go, the HMRC Time to Pay scheme lets you spread the cost over manageable monthly instalments. It's a helpful way to handle your cash flow without missing important deadlines. You can usually set up a payment plan online for tax bills up to £30,000, as long as you've already filed your tax return. ⏱️
Why is this useful for your business?
Running a business means dealing with unpredictable expenses. If your tax bill is due but your cash is tied up, this scheme gives you some much-needed breathing room. Instead of worrying about late penalties, you can break your tax bill into smaller chunks. It takes the pressure off, letting you focus on your work instead of stressing about a single large payment.
Who can apply?
You can use the online service to set up a payment plan if:
You have filed your latest tax return
You owe £30,000 or less
You are applying within 60 days of the payment deadline
You plan to pay off your debt within the next 12 months
If you owe more than £30,000 or need longer to pay, you can still apply, but you'll need to call HMRC directly to arrange your plan.
How to set it up ✅
Before you apply, make sure your tax return is filed. Once that's done, got to https://www.gov.uk/difficulties-paying-hmrc to create your payment plan.
Once you're back on track, you might find the Tax Pot useful for managing your future tax bills. It lets you automatically set aside a percentage of your income into a separate pot so you're always prepared.
Find out more here: How do automatic tax pot transfers work?