What you need to know

With the festive season underway and household budgets feeling the pressure, it may be useful to know that if you are worried about paying your tax bill in one lump sum, you may be able to spread the cost.

Although the deadline to file your tax return and pay any tax isn’t until 31 January 2026, acting early can make the process far smoother - especially if you need extra time to pay.

HM Revenue & Customs (HMRC) Time to Pay service allows Self-Assessment taxpayers to set up a monthly instalment plan once their tax return has been filed.

Since 6 April 2025, almost 18,000 people have already arranged a payment plan, making use of the flexibility to manage their tax bill without falling into late-payment penalties.

Here are some key points to be aware of:

• If you owe £30,000 or less, a plan can be set up online without calling HMRC.

• Your tax return must be filed before you can apply.

• The amount you pay is specific to your financial circumstances.

• You will still pay interest on the outstanding amounts, so the quicker you can pay, the better.

If it’s needed, HMRC’s Time to Tap can offer some welcome breathing space.

If you’re unsure about how this could apply to you, how to plan for your January tax bill, or what the Time to Pay option might look like in practice, feel free to get in touch. We can help you review your position early, so you have time to make the right decisions for your business.



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