Corporation Tax Payment Plan: How HMRC Time to Pay Works

Corporation Tax is due nine months and one day after your accounting period ends. If your company's year-end is 31 March, the tax is due 1 January the following year. If cash flow makes that payment impossible, HMRC may agree a Time to Pay (TTP) arrangement. Contacting HMRC before the due date is best, but GOV.UK describes payment plans for overdue tax too, so it is not too late to ask once the date has passed.

What Time to Pay is: an arrangement in which HMRC agrees to let a company pay the tax it owes in monthly instalments. GOV.UK says there is no time limit on how long a payment plan can last: it depends on how much is owed and what the company can afford. HMRC checks that the plan is realistic and affordable, and if a plan cannot be agreed it asks for the full amount.

Interest on deferred amounts: HMRC charges interest on Corporation Tax paid after the due date, including tax being paid under a TTP arrangement. The rate is the Bank of England base rate plus 4%, which was 7.75% a year from 9 January 2026, and it runs from the day after the due date until the tax is paid in full. A TTP arrangement does not waive or reduce it. Late payment of Corporation Tax is charged interest, not a surcharge, so paying the plan off sooner reduces the total cost.

How to ask from the UK: HMRC's payment problems page lists a digital assistant that covers Corporation Tax, with webchat to an adviser where one is available, and a Corporation Tax payment line on 0300 200 3840 (Monday to Friday, 8am to 6pm UK time, closed on bank holidays). GOV.UK also links an online service that checks whether you can set up a payment plan online. Have the company's Unique Taxpayer Reference, UK bank details you are authorised to set up a Direct Debit on, and the company's income and spending ready.

How to ask from abroad: if you live outside the UK permanently, GOV.UK lists a separate HMRC line for Corporation Tax payment enquiries, +44 300 322 9206 (Monday to Friday, 8am to 5pm UK time, closed on bank holidays), and an online form for questions about repaying tax, which needs a sign-in. Either way, HMRC asks about the company's financial position, recent accounts, cash flow, assets and liabilities, and what it can realistically pay each month, so have these ready before you call.

When to ask: as early as you can. Contacting HMRC before the due date gives the most room to agree a plan, and the sooner the tax is paid the less interest builds up. If the date has already passed, contact HMRC anyway. GOV.UK says that if you do not get in touch or cannot agree a plan, HMRC may use a debt collection agency, take money from the company's bank account (in England, Wales and Northern Ireland), or close the company down when the tax is a business tax.

What HMRC assesses: HMRC will ask why the company cannot pay on time, whether the difficulty is temporary or structural, what assets the company holds, and whether there are any related party transactions or director loan account balances. A company that has made large loans to its director while claiming it cannot pay tax will face much more scrutiny. GOV.UK says a company must reduce its debt as much as possible before setting up a plan, for example by releasing assets such as stock, vehicles and shares, and that HMRC may ask directors to put personal funds into the business, accept lending or extend credit.

If you miss an instalment: GOV.UK says HMRC will contact you to find out why and, where possible, try to rearrange or renegotiate the plan. Contact HMRC before a payment is missed if your circumstances change: a plan can be made longer or shorter, and a new tax bill you cannot pay may be added to it. If no plan can be agreed, HMRC asks for the full amount and can use its collection powers.