HMRC Debt Management Problems?

HMRC debts? It’s tempting to bury your head in the sand, but they will not go away unless you take action! Get in touch today and let us handle your HMRC Debt Management on your behalf.

“Cash flow is a big issue right now. I know that I need to pay the VAT and the PAYE, but I’m so far behind I don’t know where to start. This is serious stuff – I’m not sleeping – but I can’t pay the HMRC debt. What are my options?”

Owing HMRC money will inevitably leave you feeling worried and stressed especially if they have started legal proceedings against you or your company. Whether you owe money for VAT, PAYE or Corporation Tax, the process is much the same. Business Insolvency Helpline are experienced at assisting business owners through this process.

Get Immediate Help:


Are you facing court action from HMRC?

If you’re facing court proceedings from HMRC, you need to take action today. Business Insolvency Helpline are often called in at the last minute.  Even if you’re due in court tomorrow for a petition hearing, and the situation feels desperate, call us on 07837 9266522 and we can act immediately.

Have you received a Statutory Demand?

You may have already received a letter threatening legal action or a Statutory Demand, a Winding Up Petition or a Winding Up Order. If so, you must act now to achieve a positive outcome for you and your business.

We know from our extensive experience that we can save your business and even get things back on track again. Although that may seem unbelievable right now. Whether you’re a sole trader, partnership or limited company we can help you.

Worried about calling HMRC?

We will talk to HMRC on your behalf. We have assisted countless business owners with their problems with HMRC debts and ultimately helped many of them to become profitable again. HMRC’s approach to debt collection or debt recovery can be stressful, so we will liaise with HMRC on your behalf, so you don’t have to talk to them. They will be seeking a tax debt settlement, but we may be able to ask for a time to pay arrangement, giving you breathing room so that you can make payments over a longer period.

Time to Pay Arrangement could help

Time to Pay Arrangements can help you with a professional proposal that is backed up by cash flows and a repayment plan that you and the business can afford. More importantly that HMRC will accept. If you need help to free up cash flow or find funding so that your business can continue to trade, we can help.

What Is a Time to Pay (TTP) Arrangement?

A TTP arrangement allows for your debt to HMRC to be paid back in monthly instalments, typically over a period of up to 12 months. Although depending on your business circumstances and affordability, some arrangements can be agreed over longer periods. If you are having trouble paying your tax bill, or you foresee yourself struggling to be able to meet your tax obligations in the future, you should contact HMRC at the earliest opportunity, or contact us for specialist advice.

Whilst it is true that you are much more likely to have a Time to Pay arrangement request agreed to if you have conducted your tax affairs well in the past, i.e. by being up to date with what is due, we can still look to help even if you have a poor compliance history with HMRC.

If you need more time to pay your PAYE, CT or VAT tax bill, a TTP instalment plan may be a viable solution for your company and Business Insolvency Helpline can offer support to business owners and directors who are considering this option. However, before rushing into this as a way to bring your tax arrears up to date, it helps to have a little knowledge on what the process entails and how likely you are to have this accepted by HMRC.

If the situation is more serious, for example if your bank account has been frozen already or you are facing an imminent court appearance. The company will need immediate protection or a more formal insolvency solution. We have successfully used Company Voluntary Arrangements, Administrations Orders and Liquidations to protect and resolve HMRC debt problems for many clients.

Applying for a Time to Pay arrangement

Once you have put together a strong case in favour of being granted extra time to pay, you need to phone HMRC, or seek the help of a professional Insolvency Practitioner who will negotiate on your behalf.

But what constitutes a ‘strong’ case? This means presenting a realistic proposal in terms of what you can afford to pay, backed up by evidence in the form of:

  • Sales and cash flow forecasts for the following six months or more
  • A plan of how you will cut costs to free up extra cash
  • Generally conveying your determination to ensure repayments are met.

It is worth remembering that HMRC will want the TTP arrangement to be over the shortest time, with the highest repayments possible, in order to recoup their money quickly. You must be careful, however, to offer only what you can afford, and be certain that your company can meet its obligations as set out in the plan before it is agreed.

Dealing with HMRC can be problematic unless you understand how they operate, which is why many of our clients ask us to negotiate on their behalf.

What HMRC Consider When Assessing a Time to Pay Application

HMRC’s main concern is whether a company is asking for a Time to Pay arrangement because the company can’t pay or because it won’t. If it can pay the tax bill, they will expect it to do so on time and in full. It’s only in situations where it genuinely can’t pay that they will consider a Time to Pay arrangement.

If they consider that the company honestly can’t pay the debt, they will also look at its payment history, the sector it operates in and the likelihood of its ability to be able to pay future tax liabilities when making their decision.

What the Agreement Covers

The contents of the Time to Pay agreement are completely dependent on the particular circumstances but as a general guide it will contain:

  • The period, taxes and amounts the Time to Pay arrangement was agreed for.
  • The total debt included in the arrangement.
  • The agreed instalments: their amounts and the dates on which they will be paid.

HMRC prefers to have debts repaid quickly, so the majority of agreements are for periods of less than a year, with the largest number for periods of under six months. It is possible to negotiate longer repayment periods but you will need to have a strong case for them to agree to this.

Conditions of the Agreement

If HMRC do agree to a Time to Pay arrangement, you should be aware that it will be subject to a number of conditions. You must adhere to these conditions otherwise they can (and do) cancel the arrangement and demand immediate payment of amounts still outstanding. If this demand is not satisfied, they can bring legal action to recover the debt and charge penalties as appropriate.

  • Payment of the agreed instalments on time and in full.
  • Full disclosure of HMRC debts. You must tell HMRC about all the company’s debts to them when you are seeking the Time To Pay agreement.
  • HMRC expect you to have been honest about whether the company actually needs more time to pay and about the rate at which the debt can be repaid.
  • You will report any changes to the company’s financial situation that mean the debt can be repaid more quickly to HMRC.
  • Any repayments due from HMRC for overpaid tax should be set-off against the outstanding debt.
  • Future compliance. Any future returns must be filed on time and all future tax liabilities paid in full and on time.

It is very important that you ensure the agreed instalments are paid on time and in full – this means being sure when you are negotiating the agreement that the amounts agreed are actually affordable. Defaulting on the payments will put the company in a very serious situation and HMRC will pursue enforcement action.

The condition that companies also often find difficult is the payment of future tax liabilities in full and on time. In situations where the Time to Pay arrangement also covers future due dates, HMRC may consider including those future liabilities in the arrangements. If they dont, you must be comfortable that you will be able to meet those future liabilities as their late payment could lead to the cancellation of the agreement.

It may be that HMRC will agree a further Time to Pay agreement when further liabilities become due but they will scrutinise the company very carefully before they do so and this should not be relied on as a course of action.

Acting in the best interests of creditors?

Are you worried that you may not have acted in the best interests of your creditors? Even businesses owners who have always operated ethically in times of good cash flow may make the wrong choices when they are under extreme financial pressure.

If you are worried that you may not have acted in the best interests of creditors, including HMRC. You may be worrying about potentially facing criminal proceedings, then you are in the right place. Business Insolvency Helpline can provide impartial, confidential and professional advice that will help you work out the best way forward.

Getting your business back on track

If your business is suffering with HMRC debt problems, don’t delay get in touch today. Get impartial, confidential and professional advice from trusted HMRC Debt specialists. Contact us immediately and take the first step towards reducing your stress levels and regaining business sanity.