Time to Pay (TTP) Arrangements

Time to Pay is an established scheme that helps companies to negotiate a mutually agreement payment plan with HMRC when they fall behind with their tax obligations. In light of the wide-scale business disruption caused by COVID-19, this scheme will be temporarily extended - and the qualification criteria relaxed - to allow more companies to enter into a TTP arrangement.

How does a TTP work?

• Formal payment plan with HMRC

• Tax arrears paid over an agreed time period, typically between 6-12 months

• All forms of tax can be incorporated in one TTP plan including VAT, Corporation Tax and PAYE

What can be negotiated with HMRC?

• Implementing an instalment plan which satisfies both parties

• Suspension of ongoing or imminent debt collection proceedings

• Cancellation of accrued penalties and interest

How is TTP being managed in light of COVID-19?

• Relaxation of standard criteria, although businesses still need to demonstrate their viability in the long term

• Previous conduct and compliance with HMRC will form part of the eligibility checks

• A company must demonstrate other options have been considered with TTP being deemed the most suitable course of action

• Dedicated HMRC helpline set up to provide help, advice, and support on TTPs. The specialist TTP team at HMRC can be contacted on 0800 0159 559.

VAT and Self-Assessment Deferral VAT

• The upcoming quarterly VAT payments encompassing the period 20 March - 30 June have been deferred

• VAT for this period will now be payable by the end of the 2020-21 financial year

• All VAT-registered UK businesses eligible

• Automatic entitlement with no application necessary although any existing direct debit mandate will need to be cancelled

• VAT refunds and reclaims will be paid as normal by the government

Self-Assessment

• Income Tax Self-Assessment payments have been deferred

• Payments which were originally scheduled for 31 July 2020 will now not be due until January 2021

• All self-employed individuals are eligible

• Automatic entitlement with no application necessary

• No late penalties will be charged throughout the deferral period