The Government has introduced an immediate deferral of upcoming Income Tax and VAT payments but the other business taxes such as PAYE and Corporation Tax remain payable on the due dates.
HMRC is willing to enter ‘Time to Pay’ (TTP) arrangements where businesses or individuals are struggling to pay tax bills on their due dates. There are no set rules, as each TTP agreement is arranged on a bespoke basis. However, HMRC must be confident that the arrears will eventually be paid; it will not enter a TTP agreement if it thinks that the taxpayer will never be able to pay the arrears of tax.
Generally, TTP arrangements involve tax liabilities being deferred, without penalties, and paid over a period of up to a year, with fixed, agreed repayment schedules. It is imperative that the payment dates are not missed. If they are, the TTP arrangement
is likely to be ended by HMRC, with the full amount of tax outstanding becoming immediately due and, potentially, penalties may be payable.
TTP arrangements lasting over a year are only agreed in exceptional circumstances, although the coronavirus pandemic may mean that HMRC will be more amenable to such longer scheduling of repayments.
In the current situation, all businesses and self-employed people in financial distress with outstanding tax liabilities may be eligible to receive support.
You are eligible to apply for TTP if your business pays tax to the UK Government and has outstanding tax liabilities. If you have missed a tax payment or you might miss your next payment due to COVID-19, you can call HMRC’s dedicated helpline: 0800 024 1222 for practical help and advice.
If you’re worried about a future payment, HMRC has requested that you call them nearer the time