Taxpayers who can’t pay a tax liability in full and on time may be able to agree a time to pay arrangement with HMRC. This will allow the taxpayer to pay the tax in instalments over time. Where certain conditions are met, the taxpayer can apply for a time to pay arrangement online, rather than by contacting HMRC by phone.  

HMRC recently extended the circumstances in which the self-service facility can be used to include tax due under simple assessment. An online application relating to a simple assessment tax debt can be made where: 

• the tax due is between £32 and £50,000; and
• the taxpayer does not have any other payment plans or debts with HMRC.  

Time to pay arrangements have increased in number in recent years. In its most recent annual report and accounts, HMRC said that over 913,000 taxpayers had a time to pay arrangement on 31 March 2025, an increase of around 11,000 on 31 March 2024, and that over 90% of time to pay arrangements are completed successfully.   

It should be remembered that HMRC will continue to charge interest on overdue tax from the original due date, even where there is a time to pay arrangement in place. The rate of interest charged by HMRC on most taxes and duties is 8% from 27 August 2025. It may be possible to avoid late payment penalties by arranging a time to pay arrangement, depending on the circumstances. 

Taxpayers who have tax to pay (for example, on the state pension) but are not in self assessment or pay as you earn, may receive a simple assessment from HMRC. It is important that the taxpayer checks that the simple assessment is accurate. If a taxpayer who is in self assessment receives a simple assessment, they or their agent can contact HMRC on 0300 200 3300 to have the simple assessment withdrawn.  

ICAEW’s Tax Faculty explored the increasing use of simple assessments by HMRC in a recent episode of the Tax Track podcast.  

Further information 

• Check your Simple Assessment tax bill - GOV.UK
• Issue 134 of Agent Update - GOV.UK
• Follow the numbers: Tax debt | ICAEW