HMRC changes policy on time-to-pay arrangements

Published: 12th May 2023

The loan charge in respect of historic use of “disguised remuneration” schemes is one of the most controversial enforcement policies in existence. If you owe money under the rules, why might a quiet change in policy relating to repayment arrangements?

If you owe tax in respect of disguised remuneration settlements and the loan charge, you’ll want to know about HMRC’s recent change of policy on time-to-pay arrangements . These tax debts automatically qualified for a time-to-pay arrangement over five years if your earnings were less than £50,000 per year or, where the loan charge applies, seven years if you earned less than £30,000.

HMRC will now use your most recent complete tax-year information available to determine if you’re eligible for the automatic time-to-pay deals and generally for other personal tax debts. The new criteria will apply to future time-to-pay arrangements but will not affect those which already exist.

Although the automatic time-to-pay deals don’t apply to those whose earnings exceed than £50,000 per year, HMRC says that it will consider flexible payment plans that can be amended over time to take account of changes in your circumstances.