HM Revenue & Customs' (HMRC) Business Payment Support Service is designed to meet the needs of all businesses and individuals who are experiencing difficulties in paying the tax due in full and on time.
Please note: this service is for customers who are aware that they maybe unable to pay the payment due in full before the payment deadline.
If you have already received a demand or a letter warning of legal action you must immediately contact the HMRC office that issued it. You'll find the contact details on the correspondence or demand.
This guide will provide more detailed information on what you need to do if you think you will have difficulties paying HMRC in full and on time.
On this page:
If you have payments due now or in the near future, the sooner you get in touch, the sooner HMRC can begin working with you to find a solution. They may, in some circumstances, allow you additional time to pay.
If your payment isn't due yet, you can call the support service nearer the time once you are clear about whether you will be able to pay or not. But remember that you need to get in touch with HMRC in advance of the payment deadline date. Don't wait until the payment is overdue.
Even when you can't pay in full you must send any returns in on time. If you don't you may have to pay penalties.
HMRC's Payment Support Service on Tel 0845 302 1435 – this service is available for individuals and businesses who have not yet received a payment demand.
Opening hours are Monday to Friday 8.00 am to 8.00 pm, Saturday and Sunday 8.00 am to 4.00 pm, excluding bank holidays.
HMRC will want to know:
Note that you can still ask HMRC to consider a payment arrangement even if they contact you first.
You will need to explain why:
Depending on why you can't pay, how long you need to pay the rest and your payment history - HMRC will ask you a number of questions so that they can judge your ability to pay this debt and make future payments. You must tell the payment support service if you are receiving any repayments from HMRC.
HMRC will ask questions about your income and expenditure, your assets and the changes you are making so that you can return to making payments on time.
If you have been given time to pay before you will be asked more in-depth questions.
In more complex cases HMRC may ask for documentary evidence to consider the request for time to pay.
If you are having difficultly paying your VAT and you pay by the online VAT Direct Debit service, you will need to contact your bank to ask them to stop your next payment.
HMRC can only agree time to pay where it believes that you are genuinely unable to pay in full and on time. Also that by allowing you extra time it will mean that you can pay what is due and you can return to making future payments in full and on time.
If HMRC agree time to pay they will encourage you to set up a Direct Debit payment plan over the phone to make sure that you don't miss any payments.
If you fail to make the agreed payments or don't keep your tax affairs up to date HMRC will cancel the arrangement and take legal action to recover the outstanding amount.
HMRC can legally set-off any repayment due to you during this time to pay arrangement against the HMRC debt that forms part of the agreement.
It's important to understand that even when HMRC allow you time to pay you will still be charged interest on any tax where interest is charged for late payments.
You should contact the office who advised you that a repayment was due. You will find the telephone number on the correspondence sent to you.
HMRC can legally set-off any repayment due against money owed regardless of whether or not you have asked for this.
If your circumstances change and you become unable to make the payment covered by the agreement, as well as keeping up to date with any future payments you will need to contact HMRC before you miss any payment.
HMRC will review your time to pay arrangement and may consider amending and extending the agreement. However in such circumstances they will need to ask more detailed questions about your income and outgoings so that they can be as sure as possible that you will be able to meet any new arrangement.
This may mean that such discussions take a little longer than in the initial approach to the service and you may need to be transferred to another office to progress this.
HMRC will do its best to help you. Sometimes they may not be able to help in the way that you want and they may need to consider alternative ways of collecting the tax due.
If you already have a payment arrangement with the Business Payment Support Service which has been cleared in full you can still contact them if you are again having difficulties making subsequent payments.
If you have previously been helped by the service, HMRC will ask more in-depth questions to ensure that you can meet any new payment agreement and future payments.
The Business Payment Support Service was set up to help businesses by providing them with a short term 'breathing space' to allow them time to reorganise and restructure and get themselves in a position where they can return to making tax payments in full and on time.
VAT default surcharges will not be charged if you contact HMRC before the payment is due and HMRC agree a time to pay arrangement which you adhere to.
Entering into the time to pay agreement will not be treated as a default so it will not extend the 12-month rolling period nor will the default percentage increase because of the time to pay agreement. This is provided that the terms of the agreement are adhered to.
VAT returns must be submitted on time or this will be treated as a default and the 12-month rolling period will be extended.
Similarly, a surcharge/penalty can be avoided on a late payment of Income Tax where a time to pay agreement is entered into before the relevant surcharge/penalty date and the terms of the agreement are adhered to.
If you have contacted HMRC and agreed a time to pay arrangement before the payment is due, then this will not affect your gross payment status.
If you receive a letter advising you that HMRC has cancelled your gross payment status, as a result of their automated tests, please contact them immediately. Information on what to do and who to contact will be provided in the letter.
You will need to explain that you have a time to pay agreement with HMRC that you entered into before the due dates of the relevant payments. In most cases your gross payment status will be restored, unless there were other failure reasons unrelated to the payment in the time to pay agreement.
If you have authority to act on your client's behalf, through a form 64-8 or an online agent authorisation, HMRC can discuss your client's tax affairs with you.
HMRC can also agree a payment arrangement with you - but may need to speak to your client to set up the payment through Direct Debit.
If you wish to discuss a client's business payment position before a demand has been issued and you hold an authorisation to act on their behalf, you should contact the Business Payment Support Service.
If a demand has already been issued you should contact the telephone number on the demand notice.
For all others issues you should continue to use the regular contact numbers.
Where multiple partners are unable to pay their individual liabilities on time HMRC can discuss a time to pay arrangement for any partnership liabilities and the individual partners' liabilities with an authorised representative or the partnership providing the following conditions are met:
When you contact the Business Payment Support Service it will ask for the details of the outstanding liabilities and the details of the individual partners who are unable to pay. The information will be passed to another office who will contact you back within four working days to discuss the situation with you. Where the representative doesn't hold the relevant authorisation from the partnership and the individual partners then they will need to submit a letter detailing:
The letter must also confirm that all of the partners are giving their authority for the representative to act on the partners' behalf in respect of their Self Assessment liability and the partnership's other HMRC liabilities (if applicable). The letter must be signed by each individual partner.
HMRC will discuss the situation with the representative and where the partnership and the partners are viable will look to enter into an appropriate agreement to allow the debt to be cleared and future liabilities to be paid on time. In larger debt case HMRC may require additional evidence to assess viability.
Where a payment arrangement is agreed the preferred method of payment is by Direct Debit from the partnership bank account. By completing a single Direct Debit mandate HMRC can arrange payment to be made by up to 99 reference numbers. Otherwise representatives must make sure that payments for each individual partner and partnership liability are made separately.