Glossary · UK
What is Time to Pay Arrangement?
A formal instalment plan agreed with HMRC to pay overdue or upcoming tax in structured monthly payments, with interest charged at 7.25% per annum.
Full Definition
A Time to Pay (TTP) arrangement is a formal agreement between a taxpayer and HMRC to pay outstanding tax in regular instalments rather than as a lump sum. HMRC charges interest at the official rate (7.25% per annum in 2026/27, calculated as Bank of England base rate plus 2.5%) on the outstanding balance throughout the arrangement. No additional surcharge is applied if TTP is arranged before the payment due date. For Self Assessment debts under GBP 30,000 that are less than 60 days overdue, a Time to Pay arrangement can be set up online through HMRC's Government Gateway. Larger amounts or other tax types (PAYE, VAT, Corporation Tax) require a phone call to HMRC. Duration typically 12 to 36 months depending on affordability. Arrangements are usually reviewed if circumstances change.