Tax stats. Recent statistics show that in the period to June 2019 nearly 700,000 businesses and individuals made arrangements with HMRC to pay their tax by instalments using a time-to-pay agreement (see The next step ). This type of agreement can only be made before the tax becomes due, but there are advantages.
Tip. While HMRC charges interest (generally at 3.25% per annum) on tax which is paid late, it will usually forgo late payment penalties which would otherwise apply if you didn’t come to a time-to-pay agreement (see The next step ). If you think you might not be able to pay your tax on time, contact HMRC sooner rather than later.
If you are expecting a tax bill which you won’t be able to pay on time, ask HMRC for a time-to-pay agreement. This can protect you from being charged late payment penalties.