Understanding Self Assessment and your tax return

If you cannot pay your tax bill on time

Guide

You must arrange to pay your tax bill with HM Revenue and Customs (HMRC) if you either:

  • miss a payment
  • know you cannot pay on time

If you pay a tax bill late you must pay interest on the amount you owe until it’s paid off. You can avoid penalties by arranging a payment plan with HMRC before the tax is due - or by 1 April for Self Assessment.

If you owe Self Assessment tax and your bill is less than £30,000 you may be able to pay in monthly instalments.

For any other bills or problems paying, you must contact HMRC to discuss your options. How you contact HMRC depends on what you need to pay.

If you cannot pay because of coronavirus (COVID-19)

You may be able to pay your Self Assessment tax in monthly instalments. This includes any delayed (deferred) ‘payments on account’ that were due in July 2020, if you did not pay them at the time.

Contact the HMRC coronavirus (COVID-19) helpline if you cannot pay any other tax bills because of coronavirus.

If you cannot pay your Self Assessment tax bill

You can set up a payment plan online to spread the cost of your latest Self Assessment bill if:

  • you owe £30,000 or less
  • you do not have any other payment plans or debts with HMRC
  • your tax returns are up to date
  • it’s less than 60 days after the payment deadline

You do not need to contact HMRC if you set up a payment plan.

Call the Self Assessment helpline if you’re not eligible for a payment plan or cannot use the online service.

Self Assessment Payment Helpline
Telephone: 0300 200 3822
Monday to Friday, 8am to 6pm (closed on bank holidays)
Find out about call charges

If you cannot pay other taxes

You might be able to set up a Time to Pay Arrangement with HMRC if you’re unable to pay any other taxes in full. This lets you spread the cost of your tax bill by paying what you owe in instalments.

How you do this depends on whether you’ve received a payment demand.

If you’ve received a payment demand, like a tax bill or a letter threatening you with legal action, call the HMRC office that sent you the letter.

If you’ve not received a bill or letter, call the Payment Support Service (PSS).

Payment Support Service
Telephone: 0300 200 3835
Monday to Friday, 8am to 6pm (closed on bank holidays)
Find out about call charges

Nominated partners in business partnerships can negotiate a Time to Pay Arrangement with HMRC on behalf of the partnership or individual partners.

Before you contact HMRC

You’ll need to know:

  • your reference number (for example, your 10-digit Unique Taxpayer Reference or VAT reference number)
  • the amount of the tax bill you’re finding it difficult to pay and the reasons why
  • what you’ve done to try to get the money to pay the bill
  • how much you can pay immediately and how long you may need to pay the rest
  • your bank account details

What happens when you contact HMRC

HMRC will ask you about:

  • your income and expenditure
  • your assets, like savings and investments
  • what you’re doing to get your tax payments back in order

HMRC will decide whether you should be able to pay immediately. If you cannot, they’ll decide whether you’ll be able to get your payments back on track with more time.

You’ll be asked more in-depth questions if you’ve been given more time to pay before. In more complex cases HMRC may ask for evidence before they make a decision.

What happens next

You’ll have to pay immediately if HMRC think you can when you call. You can pay by Direct Debit, corporate credit card or debit card over the phone.

You’ll be charged a fee if you pay by credit card. The fee is not refundable.

If you cannot pay all your tax bill, you may be able to:

  • pay your bill in instalments by Direct Debit
  • get more time to pay

When you might get more time to pay

HMRC may offer you extra time to pay if they think you genuinely cannot pay in full now but will be able to pay in the future.

You can set up a plan to pay in instalments by Direct Debit on dates they agree with you.

Tell HMRC as soon as possible if your circumstances change and you can pay your tax bill faster.

You’ll have to pay interest on the amount you pay late.

You must keep these payments up to date and pay your other tax. If you do not, HMRC will normally cancel the arrangement and take legal action against you straight away.

When you will not get more time to pay

If HMRC do not think you can get your payments on track with more time, they will not make an arrangement with you - they’ll expect you to pay your tax bill straight away.

If you do not, HMRC will start ‘enforcement action’ to get the money from you.

Help and advice

If you’re in Northern Ireland, you can get free debt advice from Advice NI.

You can also contact HMRC for help.

Making a complaint

You cannot appeal against HMRC’s decision, but you can make a complaint if you’re unhappy about how you were treated.