If you cannot pay your tax bill in full by the due date, HMRC's Time to Pay (TTP) service lets you spread the debt across affordable monthly instalments. Rather than face late-payment penalties and enforcement action, a TTP arrangement pauses these consequences while you repay in agreed amounts. This guide covers who qualifies, how to apply online or by phone in 2026, what interest you will pay, and how to protect your arrangement if your circumstances change.
Time to Pay is available across most major UK tax types:
HMRC introduced an online self-serve TTP service for Self Assessment that significantly reduces the friction of applying. To use it, you must meet all of the following conditions at the time of application:
If eligible, log in to your HMRC online account, navigate to your Self Assessment balance, and select the option to set up a payment plan. The system will show you the outstanding balance including interest to date, ask you for an initial lump sum payment (if any), and then suggest a monthly direct debit amount. You can adjust the monthly amount within the limits the system allows. The arrangement is confirmed immediately online.
For debts above the online threshold, for business taxes, or if you do not meet the online criteria, you must contact HMRC directly:
When you call, HMRC will ask a series of questions about your income, outgoings, savings, and assets to establish what you can genuinely afford to pay each month. Be prepared with your bank statements, recent payslips or accounts, and a clear picture of your monthly surplus. HMRC negotiators have discretion to agree arrangements -- being open and providing full information gives the best chance of a favourable outcome.
Agreeing a TTP arrangement does not eliminate the interest that accrues on your unpaid tax. HMRC charges late-payment interest from the day after the original due date until the tax is paid in full. The rate in 2026 is the Bank of England base rate plus 2.5 percentage points. With the base rate at its current level, this translates to a meaningful additional cost over a 6 to 12 month repayment period.
What TTP does prevent is the imposition of further late-payment penalties on the amounts included in the arrangement. Under the new penalty regime for Self Assessment (phased in from 2025/26), a TTP arrangement agreed before or shortly after the 15-day or 30-day penalty point prevents the point-based penalties from escalating, provided you maintain the agreed payments. However, any payments you miss will reactivate the penalty regime immediately.
HMRC's debt management teams are trained to agree realistic, affordable payment plans rather than push taxpayers into financial distress. They consider:
HMRC will typically agree a TTP period of 3 to 12 months for most individuals. Longer arrangements are possible but require stronger justification. HMRC expects you to commit your full disposable income after essential expenditure to the arrangement -- they will not agree a plan that leaves you with substantial savings while a tax debt remains outstanding.
Circumstances can change. If you realise you cannot meet an upcoming TTP instalment, contact HMRC before the payment date -- not after. HMRC may agree to:
Proactive communication is essential. A cancelled TTP arrangement is difficult to reinstate, and HMRC may move to enforcement action (distraint, county court proceedings, or winding-up petition for companies) if no new arrangement is agreed. If your financial position has genuinely deteriorated, seek advice from a tax adviser, debt charity such as StepChange or Tax Aid, or an insolvency practitioner.