What to Do If You Can’t Pay HMRC: Expert Guidance from SG Accounting

We know that from time-to-time everyone can experience uncertainty surrounding their finances, and that this time of year in the lead up to Christmas and tax return season can amplify those worries.  

If you’re struggling with balancing your business’ finances and are concerned where to turn for support or guidance, SG Accounting is here to help.  

In this blog we help steer you in the right direction. You are not alone, we’re here to help and can assist you in getting the support you need. 

First and foremost, your Client Director is always here for you. Please know that they have spoken to numerous other clients about their financial situations and have been able to offer guidance and support on where to turn next.  

Whilst it can seem easier to bury your head in the sand or avoid talking about it, the best course of action is to get it out in the open and seek help. We strongly urge anyone who finds themselves in this position to get in touch with their Client Director and let us help put a plan together. Please know that we do this without judgement and are here to help you. 

A common misconception about HMRC is that they are harsh enforcers who will demand immediate payment if you disclose that you owe money, regardless of your individual circumstances. 

This is a complete myth, and that with the right communication and visibility, HMRC deal with each case individually and compassionately. They’re able to look at your circumstances and potentially offer a payment plan that suits both yourself and them, so there is light at the end of the tunnel.  

Please note that your Client Director cannot answer specific questions regarding your circumstances or speak to HMRC on your behalf. Whilst they are there to help you understand your situation and what you need to do, they do not have authorisation to discuss your finances with HMRC. 

If after speaking with HMRC you feel as though the option they’ve set out for you is still unachievable, you can liquidate your company through Creditor’s Voluntary Liquidation (CVL). You’d need to appoint an insolvency practitioner, who’d effectively become the middleman between your company and HMRC, and they work by assisting in managing your debt and ultimately dissolving your company. Your Client Director can put you in touch with a trusted insolvency practitioner.  

It’s important to remember that this process should be considered a last resort, as it may impact your eligibility for future directorships. You may also have other options dependent on your circumstances, and we’d advise speaking with your Client Director. 

1. Before you do anything else, speak to your Client Director. They can help build a clear picture of what needs to be done, so you have a complete understanding of your situation and the steps you need to take.  

2. Speak to HMRC directly, you can find all of their phone numbers here. The more information and clarity you’re able to provide them with, the more options they’ll be able to give you, such as setting up a Time to Pay Plan. They’re open Monday to Friday, 8am to 6pm and are closed weekends and bank holidays.  

When you call, ensure you have the following information ready (your Client Director can help you prepare this information): 

• Your Unique Taxpayer Reference (UTR) or tax reference number 

• Details of the amount you owe and why you can’t pay 

• How much you can pay now and how long you need to pay the rest 

• Your income and expenditure details (for individuals/self-employed) 

3. If you feel like the options provided by HMRC are out of your reach, consider company liquidation. Ask your Client Director for more information. 

4. Ensure you’re taking some time to look after yourself. Financial issues can be incredibly stressful, and the impact they can have not only on your professional life but also your personal life can become overwhelming. Remember that your Client Director is always here to offer guidance and a listening ear, but if you’re struggling with your mental health Samaritans are always there to listen. You’re able to call them directly on 116123, email them at jo@samaritans.org, write a letter, or speak to a Samaritan face-to-face.   

Never feel you must face these challenges alone or hope they’ll resolve themselves. Many of our clients have navigated similar situations, and while the outcome may not have matched their original expectations, there is always a path forward.  

With the right guidance and support, we’re here to help you take the next steps.