HMRC Time to Pay arrangements
If you cannot pay a tax bill in full, HMRC can let you pay it in instalments. Here is how the amount is worked out and how to keep the arrangement on track.
Applies to: UK-wide
What to do now
- File any outstanding tax returns first — HMRC expects returns to be up to date.
- Work out your spare income with the budget calculator.
- Contact HMRC before enforcement starts — it is easier to agree a plan early.
Online or by phone
For Self Assessment, you can set up a plan online through HMRC’s service if all of these apply:
- you owe £30,000 or less;
- your tax returns are up to date;
- you have no other tax debts and no other HMRC payment plan;
- you can set up a Direct Debit from a UK bank account in your name without anyone else’s authorisation.
If you cannot use the online service, or the debt is another tax, call the payment line for that tax. HMRC’s payment helplines open Monday to Friday, 8am to 6pm:
| Tax | Phone |
|---|---|
| Self Assessment | 0300 200 3820 |
| VAT | 0300 200 3831 |
| Employer PAYE | 0300 200 3819 |
| Simple Assessment | 0300 322 7835 |
| Corporation Tax | 0300 200 3840 |
What HMRC will ask
- Whether you can pay in full, and if not, how much you can pay each month.
- Whether you owe any other tax.
- What you earn and usually spend each month.
- What savings or investments you have — HMRC expects these to be used to reduce the debt as far as possible.
Have your tax reference, such as your Unique Taxpayer Reference, and your bank details ready. HMRC accepts a Standard Financial Statement prepared with an independent debt adviser as evidence of your income and spending.
How the monthly amount is set
HMRC works out what is left of your income after essential costs such as rent, food, utilities and fixed outgoings. It usually asks for about half of that amount each month, though you can offer more. Pension income counts as income, but the value of your pension pot is not treated as savings. There is no set maximum length — it depends on what you owe and what you can afford. Interest is charged on the outstanding tax while you pay, so paying more when you can reduces the total.
Keeping it on track
- Tell HMRC about any change in your circumstances; the plan can be lengthened or shortened.
- If you miss a payment, HMRC will contact you to find out why and may renegotiate. If you fall behind and do not engage, it may ask for the full amount.
- A new tax bill can often be added to an existing plan — ask before it falls due.
- Keep filing returns and paying new tax on time; that is usually a condition of the arrangement.
Time to Pay and penalties
Agreeing a plan and keeping to it can affect late payment penalties — can’t pay your Self Assessment bill explains how. If you do not agree a plan, HMRC can use its collection powers — how HMRC collects unpaid tax.
You never have to pay for debt advice. MoneyHelper (government-backed), StepChange, National Debtline and Citizens Advice all give free, confidential advice with no obligation.
Common questions
How much will HMRC want each month?
HMRC usually asks for about half of the income you have left after essential costs. You can offer more, and it expects savings to be used to reduce the debt first.
Can I set up an HMRC payment plan online?
For Self Assessment, yes, if you owe £30,000 or less, your returns are up to date, and you have no other tax debts or HMRC payment plans. Otherwise you can call HMRC.
Is there interest on a Time to Pay arrangement?
Yes. Interest is charged on the unpaid tax until it is cleared, so paying more when you can reduces the total.