Contact HM Revenue and Customs (HMRC) as soon as possible if you have missed your payment. How to contact HMRC depends on what you have to pay. If your situation improves and you can pay the bill faster, contact us to increase your monthly payment. As a rule, such an agreement can last three or six months, your circumstances being verified at the end of this period. If DM or a collection office commissioned by HMRC accepts your request for payment, you must receive written confirmation of this. If you receive an oral agreement, you should have it confirmed in writing. If not, there could be difficulties later if there is a dispute over what exactly has been agreed. If you have a high disposable income but still need extra time to pay, we`ll work with you to agree on a payment level that quickly offsets the debt with your reasonable monthly expenses. This may mean that you pay more than 50% of your disposable income. The agreement normally lasts 12 months, but there is no standard agreement and no cap for the time it takes a person to pay the debt. HMRC will review your financial situation to ensure the plan is affordable. HMRC will look at revenues and expenses, savings, investments and other assets and liabilities.
You calculate your monthly disposable income and expect 50% of that income to be paid for the payment plan. HMRC`s flexibility will likely come to an abrupt end if you don`t stick to a payment plan you`ve already negotiated. In addition, the payment plan fails when other taxes due are not paid. If you don`t make your payments, you`ll likely cancel the time-to-pay arrangement and may accept a penalty. Sometimes the threat of insolvency in the form of a CVA can cause HMRC to agree to a time-to-pay agreement. This is because, in the case of a CVA, the return is over a period of 3 to 5 years and may not cover the entire debt. Even though the company eventually became insolvent, HMRC cannot be abandoned with anything. It is therefore possible to convince HMRC that a ”time to pay” agreement is the best way to ensure that all unpaid taxes from the company are recovered within a reasonable time. However, if your circumstances change during the arrangement, you must notify HMRC immediately. They may withdraw from the agreement if your new circumstances do not meet the TTP criteria. HMRC will want to make sure you don`t try to voluntarily avoid your tax debts.
When balancing the risk of taking extra time for payment, they also take into account the industry you work in and their overall repayment history. Even if an HMRC CVA doesn`t encourage people to accept your offer, it can be exactly what your business needs. Here`s an example where refusing a ”time to pay” deal has greatly benefited one of our clients: a little time should be spent here to make sure you can afford to pay the current refunds of taxes due. How you do this depends on whether you have received a payment request. HMRC may enter into another time-to-pay agreement when other commitments are due, but they will look at the company very carefully before doing so, and this should not be used as a modus operandi. . . .