HMRC’s Changing Approach to Time to Pay

I am seeing an increase in requests for assistance with approaching HMRC for Time To Pay (TTP) arrangements, and have identified a number of issues relevant to directors where the risk of company insolvency is imminent. I’ll summarise these briefly as follows;

Discussion Points

• HMRC has started raising personal liability concerns during TTP discussions.

• Recent interactions involve faster escalation to director accountability.

• HMRC assesses governance, decision-making, and arrears buildup.

• Repeated or delayed engagements can increase personal liability risks.

Risks for Company Directors

• Directors may be personally exposed to unpaid tax liabilities.

• Non-compliance, delayed submissions, and inconsistent engagement heighten risks.

• Personal liability notices are more frequently discussed in TTP contexts.

• Early, transparent action with professional advice is crucial for protection.

Importance of Proper TTP Management

In view of the above, directors should consider the following;

• Start discussions with HMRC as soon as possible. Do not delay engagement.

• TTP requests should be approached with careful preparation and documentation.

• A TTP should align with the Company’s broader restructuring strategies, not replace them.

• Clear TTP rationale and early professional advice will help mitigate personal and business risks.

• Reactive or reactive engagement can lead to increased scrutiny and director liability.

• Avoid being issued with a winding up petition and explore alternatives to a TTP.

Directors should consider the above if either considering or are in the process of directly discussing TTP arrangements with HMRC, and if in doubt, seek professional advice.

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