Can I request a Time to pay extension if I Can’t Pay my tax bill?
HMRC launched a time-to-pay arrangement scheme to assist individuals and businesses with difficulty paying their tax bills. If you are near the self-assessment deadline and have trouble paying your tax bill, this agreement can help you.
What is Meant by Time to Pay Tax Extension?
The time-to-pay extension is a payment plan between the individual and HMRC that allows you to make monthly payments towards the tax bill if you are struggling to pay on time.
If you cannot meet your tax payment deadline or think you could have difficulty doing so, contact HMRC. The idea of this can be confusing, but nobody wants to see you suffer, and setting up an arrangement means there’s a great. If setting up this arrangement means there’s a great chance of tax being paid, then HMRC will likely get open to it.
Should I have to pay Interest?
Yes, HMRC can charge interest on the tax you owe, even if you set up a time-to-pay arrangement. Interest will be charged to accrue the original payment deadline until the arrangement ends.
How Can I Request a Time to Tax Pay Agreement?
If it’s your self-assessment tax bill and it is for less than 60 days, then you should set up a time to pay online after the deadline, and you have
- Submitted your tax return
- Have £30,000 or less
- You don’t have debts or payment plans with HMRC
You must contact HMRC and speak to their advisor for every tax-related query. They’ll ask for the reference number related to the bill you want to discuss with your UTR number. So, having these with you before the call is essential.
How Much Should I Have to Pay?
The payment plan for the amount you owe and the interest will depend upon what you and your business can afford to pay.
Individuals who request the payment plan cannot pay more than 50% of their disposable income, and HMRC will carry out an income and expenditure assessment to work on this.
You must also provide your details and any dependents with information about you and the household income you spend each month.
How Much Duration Can a Time-Pay Arrangement Take?
The duration depends entirely on the money you owe and how much the business can pay. These arrangements are flexible so that you can adapt to any.
How long can a Time to Pay arrangement be?
This depends on how much you owe and what you or the business can pay monthly. These time-to-pay extensions are intended to be flexible, so the payment plans can be adapted if your circumstances change.
However, if you make larger payments in a very short period, your income may rise, or your expenses may increase while your income reduces.
My Home Will Stay Safe If I Make a Time to Pay Arrangement
HMRC states they won’t ask individuals to sell their family home to pay tax bills, whether they have other assets or second home savings. HMRC will discuss the matter in detail, which means your pension pots are entirely safe.