PAYE Tax Arrears

The introduction of Real Time Information System (RTI) by HMRC in April 2013 in order for employers to calculate and pay PAYE tax due has made it almost impossible to under estimate this liability or claim to be unaware of the payment due dates.

Furthermore from March 2015 any late payment penalties will also be issued in real time. HMRC will ultimately conclude that if company is repeatedly in arrears the only option available to them is to instigate recovery proceedings.

There are however still options available, one of which is via the Business Payment Support Service.

This was introduced by HMRC in 2008 as a dedicated support service to assist businesses affected by the current economic conditions.

They are able to discuss payment options helping you overcome short term cash flow difficulties. The options available are generally a time to pay arrangement or the ability to pay your bill by instalments.

As with unpaid Corporation Tax you will need to provide information relating to income, expenditure, business assets and steps taken to get your tax position back in order before HMRC are be able to discuss options with you. In this regard it is important to seek professional advice on matters such as:

  • Preparation of a business improvement plan
  • Revised cash flow forecasts to determine ability to pay
  • Funding options available
  • Suitability of an insolvency process to assist with recovery

Remember if you are having problems paying HMRC, the earlier you address them the earlier solutions can be put into place.