What if I can’t pay my VAT Tax bill on time?

There are times when business and individuals struggle to pay their VAT and tax bills on time for a variety of reasons. This may be due to unexpected costs, such as the increase in corporation tax rates, reduced seasonal income or lack of general cashflow to name a few.

When a Vat or Tax bill is due, HMRC will expect you to pay it straight away if they think you have the financial means to do so.

As of 13 January 2018, HMRC no longer accept credit card payments due to EU restrictions on credit card payment fees.

Unable to pay your VAT or tax bill

 If you are unable to pay your VAT or tax bill you may be able to pay your bill in instalments by Direct Debit or be given more time to pay. This will;

Time to Pay agreements

Agreements follow set guidelines and are not available to everyone. They are only possible if you can prove you do not have the required funds to pay your bill when it is due or would have difficulty securing other finance, such as a loan.

The more notice you give HMRC that you are unable to pay your bill the better, preferably before the payment is due. It can then be easier to arrange time to pay agreements before the bill due date.

It is worth noting that time to pay agreements are not available to companies and individuals where the bill is a result of an enquiry or compliance check, [more info - https://www.gov.uk/tax-compliance-checks]

Who can get more time to pay

If the HMRC thinks that you genuinely cannot pay, in full when your bill is due, but can prove that you will have the means to pay in the future by keeping up with your monthly repayments, then they may offer you extra time to pay. You will have to pay interest on the amount you pay late.

If you fail to keep up to date on your repayments or pay any other tax liabilities, HMRC will cancel the time to pay arrangement and take legal action to recoup any money owned.

Who can't get more time to pay

HMRC will not make a time to pay arrangement if they do not think you can get back on track with your payments by being given more time to pay. If this is the case, you will be expected to pay your bill in full on its due date.

If you do not make the payment, then HMRC will take action to recoup any monies owed, which is a far from ideal situation for a company or individual to be in.  [find out more- https://www.gov.uk/if-you-dont-pay-your-tax-bill]

Actions taken by the HRMC include;

Court action

Taking control of goods

Debt collection agencies

Deductions from your earnings or pension

Taking money from your bank or building society account


Vat and Tax Funding Options

For those that are not eligible for time to pay agreements or not comfortable with owing HMRC money, there are several finance options to enable you to pay your bill on time.

VAT and Tax bill loans spread the cost of large bills over terms ranging from 3 months to 5 years.

With access to a wide range of credit lines, we assist U.K. based businesses to source suitable VAT and Tax bill funding whatever their needs and requirements.

With access to over 250 lenders, ranging from alternative finance lenders to high street banks, we can source the most suitable finance for your needs.


How long before I get a decision on my tax loan application?

You will receive a decision in little as 24 hours.

Who is income tax bill finance available for?

Sole traders, partnerships & members of an limited liability partnership.

I have already paid my tax bill, can I still apply for finance?

Yes, finance for tax bills is available for up to 1 month after you have paid it.

I have already paid my VAT bill, can I still apply for finance?

Yes, you can finance your VAT bill up to 14 days after you have paid it.

I am past the tax due date, can I still apply for a loan?

Yes, you can finance your tax bill up to 1 month after it was due.

I am past the VAT due date, can I still apply for a loan?

Yes, you can finance a VAT bill up to 14 days after its due date.

What loan terms are available for VAT and tax bill funding?

We offer funding terms between 3 months and 1 year, however in certain circumstances terms can be longer.

For more information on our services and how we can help you fund your:-

Updated: July 08, 2019