Many business owners are struggling with cashflow concerns and may be worried about how to keep on top of bills such as their monthly PAYE and NIC payments due to HMRC. In these cases, a Time to Pay (TTP) arrangement may help.

A TTP arrangement is a tailored agreement with HMRC to pay future tax liabilities and/or arrears over an agreed period of time, usually in equal monthly instalments.

Along with the benefit of spreading the payments, a TTP can also avoid incurring late payment penalties, although interest will still be charged on any overdue amounts at HMRC's interest rate, currently 6.75% per annum.

Some businesses will be able to apply for a TTP agreement quickly and easily online using the link in their Business Tax Account. This means a decision can be made without the need to speak to an HMRC representative over the phone. To be eligible to do so, the business must meet the following conditions:

• all employers’ PAYE submissions and Construction Industry Scheme (CIS) returns must have been submitted
• the PAYE debt has to be less than £15,000
• there must be no other debts owed
• it must be within 35 days of the date the liability was due; and
• the debt must be planned to be cleared within the next 6 months

If the business doesn’t meet the conditions set out above, they will need to contact HMRC, and an adviser will discuss the options available.

 

This article reflects the position at the date of publication 10 May 2023. If you are reading this at a later date you are advised to check that that position has not changed in the time since.   We regularly publish articles on a range of tax and wider topical issues which affect employers. If you wish to subscribe to our monthly Employer Focus e-newsletter, please contact us.