Typically you will be required to pay the amount owed over 12 months. However, depending on your circumstances, the amount owed and how much you can pay
back each month, it may be possible to negotiate a longer repayment period.
If you do find yourself having trouble paying your tax bill, or you suspect that you may encounter trouble in the future, we recommend that you tackle
the situation as soon as possible to ensure you are in control, complying with your duties as a director and understand any consequences of not addressing
the underlying problem whilst continuing to trade and incur further debt. ICS can help with that; contact our specialist team today who can provide appropriate advice to help you understand your options and help negotiate the best outcome for you with HMRC.
There are also a number of typical conditions that must be met before HMRC will consider a request for a TTP:
- All tax returns must be completed and up-to-date
- HMRC must be completely satisfied that you cannot pay your tax
- HMRC must be confident that all future tax payments will be paid in full and on time
- Any outstanding taxes must be paid in full and as quickly as possible
- They must be confident that you have explored, but have been unable to find, alternative funding
If you are looking to make a Time To Pay Arrangement with HMRC, you will likely be asked to produce a repayment offer and make your case in writing. You
will also be asked to produce copies of your financial information and put forward a case explaining why you are unable to pay your bills and how much
you can realistically afford to pay each month. Although it may be tempting to overstate how much you can afford, it’s important to be honest. Offering
to pay more or less than you are able could result in your repayment request being rejected.
There are a number of factors that HMRC will look at when considering your case:
- The viability of your business in the long term
- The likelihood of your repayment proposal being successful
- Whether there are any suitable alternatives
There is no set criteria that you have to meet before your proposal will be accepted. However it is important that you are able to present a convincing
argument on why you cannot pay and how you are going to get the money to them over a set period of time. You must be able to produce evidence of your
projected income for 12 months (or the agreed upon repayment period) as well as your expenses. They will also want to hear that you are committed and
determined to paying them back in full.