HMRC Time to Pay explained (2025-26)

What it is

Time to Pay is HMRC's arrangement that lets you spread an unpaid Self Assessment bill over monthly instalments by direct debit. For bills up to £30,000, most people can set it up online without phoning anyone, as long as all returns are filed and the bill is less than 60 days past the 31 January deadline. Above £30,000, or for longer plans, you must phone the Self Assessment helpline and go through an income-and-outgoings conversation. Time to Pay does not wipe interest. Late-payment interest on Self Assessment runs at Bank of England base rate plus 4%, which was 7.75% as of 9 January 2026.

How it applies to gig workers

A 34-year-old Uber driver files his 2024-25 return on 31 January 2026 and sees a £3,000 bill. He has £500 in savings. He qualifies for online Time to Pay because the bill is under £30,000, his return is filed and he is within the 60-day window. On 1 February 2026 he logs into his HMRC account, clicks "Set up a payment plan", pays £500 up front and asks for 10 monthly instalments from March to December 2026. HMRC's system calculates roughly £255 to £260 a month after interest and sets up the direct debit. Because he set the plan up quickly, he avoids the 5% late-payment penalties that would hit at 30 days, 6 months and 12 months late. Interest still runs, adding maybe £80 to £100 over the life of the plan.

Time to Pay is not automatic. You can be refused if your plan looks unrealistic, if you already have an arrangement, or if you owe more than £30,000 and cannot evidence affordability on the phone. HMRC does not normally report Time to Pay to credit reference agencies, so it does not show on standard credit files, but a County Court judgment from enforcement action would.

If tax debt is part of a wider mess with rent arrears, council tax debt or credit arrears, Time to Pay alone can make things worse by locking in monthly HMRC payments you cannot actually afford. In that case, speak to TaxAid for tax-specific help and StepChange or National Debtline for full debt advice before agreeing anything with HMRC.

What you should do about it

• File the Self Assessment return immediately if it is not in. You cannot get Time to Pay without the return filed.
• Check the bill is under £30,000 and less than 60 days past 31 January. If so, use the online "Set up a payment plan" tool.
• Choose a monthly payment you can actually afford after rent, food and priority debts, not just the fastest schedule.
• If you owe more than £30,000, already have an arrangement, or need longer than 12 months, ring the Self Assessment helpline and have your income and outgoings ready.
• If your situation changes, call HMRC before a direct debit bounces and renegotiate rather than letting the plan fail.
• If tax is only one of several debts, speak to TaxAid, StepChange or National Debtline first.

Last reviewed

19 April 2026

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• hmrc time to pay planner — anchor: "HMRC Time to Pay planner"
• hmrc time to pay call script — anchor: "Time to Pay phone call script"
• self assessment deadlines 2026 — anchor: "Self Assessment deadlines"
• cant afford january tax — anchor: "what if you cannot afford January's tax bill"
• payments on account — anchor: "payments on account"

Primary source used:

• Research/Gap/G1.6-hmrc-time-to-pay.md