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What to Do If You Can’t Pay Your Taxes

What to Do If You Can’t Pay Your Taxes
Thursday, June 21, 2018

Accountants save you a lot of money on tax because they understand which reliefs you are entitled to or which expenses you can claim for. But what can you do if you don’t have enough money to pay your taxes even after your accountant has thoroughly worked on your numbers?


In this article, the Panthera team will explain what you can do to get extra time to pay and why you should definitely tell HMRC about any difficulties you are having.


Contact your accountant


Many self-employed people don’t take full advantage of all of the reliefs and benefits that are available to them because they try to do it all themselves. It’s understandable. If you do your own books, how can you be expected to know every nuance of tax law that will result in you saving money?


This is where an accountant will come in. They can trim the fat off your tax bill saving you money and making sure you aren’t paying more than you need to.


The sooner you get an accountant involved in your business, the sooner you’ll be on top of all things tax and financial.


Contact HMRC


If missing a tax payment is unavoidable and the deadline is looming, then you’re going to have to tell HMRC about it. Before contacting HMRC, make sure that you have the following information ready:


  • Your reference number (such as your VAT reference number),
  • The amount of your tax bill that you cannot pay,
  • The steps you’ve taken to try and pay the bill,
  • How much you can pay immediately and how long it will take to gather the rest of the payment,
  • Your bank account details/your business’ bank details.


Create a payment proposal


When you contact HMRC, they will most likely ask you a lot of questions - about your income, your expenditure, your assets, and whether you’ve approached a finance company to take a loan out to pay the bill.


The reason we advise that you contact HMRC as soon as possible is because this will give you more time to create a payment plan – you may have heard this referred to as “Time To Pay”. It is possible to reach an agreement with HMRC to pay back the owed tax in instalments over an extended period of time.


You will have to agree set dates that you can make the payments on. HMRC will insist that you make the payments by direct debit. It is also worth mentioning that you will have to pay interest on the amounts that you owe. For this reason, it is for the best that you pay back the amount you owe as soon as possible to avoid additional interest building up.


When you won’t get more time to pay


If HMRC believe that you still won’t be able to make the payments even if they give you an extended time to pay, then they won’t agree to give you more time to pay. It’s as simple as that.


You will have a better chance of negotiating additional time to pay if this is only the first or second time that you have failed to make a tax payment. However, if the taxman deems you to be a “repeat offender” then the chances are that you will be forced to pay the entire bill by the due date (or straight away if the bill is overdue).


Don’t ignore your bill


As worrying as it is, it’s best to confront the situation and work with the taxman. HMRC have a lot of options when it comes to collecting what they are “owed”. They can take a portion of your earnings, delve into your pension, and even repossess your property.


HMRC has the power to declare your company insolvent as well as being able to shut down your company entirely.


An ounce of prevention is worth a pound of the cure


So what can be done? Work with an accountant. If you think you’re going to struggle, speak to your accountant. Accountants like Panthera deal with HMRC on a daily basis and we’re familiar with the way they work.


Call us on 01235 768 561 or drop us an email to – we’ll be back in touch with you shortly.

What our clients say

For us, there is nothing better than a happy customer. Here are just a few that let us know how much we mean to them.

Pete Dungey

Simple, efficient and most importantly, hassle-free.

We found Panthera via our search for a Xero expert. We knew the software we wanted to use, and needed a forward-thinking accountancy partner who could get us up and running, and teach us the ropes moving forward. Tory and her team have always been on hand to answer our questions, and help us to grow as a business, particularly during periods of big change, such as becoming VAT registered. They are always on hand to alleviate any concerns and help to keep our records in order, which makes our year-end accounts an absolute breeze! Being based in Bristol, our relationship is entirely email based, alongside one consolidation meeting at year end - this keeps things simple, efficient and most importantly, hassle-free.

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The support and service we receive from Panthera Accounting is very good. Everything from regular meetings, a prompt e mail response and the transition of our Xero software (which we find very pro active indeed) has and is all remarkably efficient. We find Panthera talk our language and make any process as painless and easy as possible.

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We got in touch with Panthera Accounting by way of a recommendation; we haven't looked anywhere else since. They are an extremely professional yet relaxed group of people. We were slightly daunted by the idea of accountants but Panthera brushed aside y the stereotypes. They are very understanding when answering any questions we may have. They are completely efficient, offer sound business advice, and are fantastically priced. We will continue to recommend them.

Ash & Tim Lane Starveacre Fencing
Jayne Johnson

An Asset to my Business!

The whole team at Panthera are great! Working with them has been a huge support to my growing business. They help me to understand the numbers I need to know. They give me technology solutions like Xero so that I can process things quickly and have access to my own figures. They are quick to reply, highly knowledgeable, nothing is too much trouble and as well as making sure that everything is compliant and on time, they are enthusiastic, professional and fun to work with.

Jayne Johnson Better People
John Baker

Absolute joy - they provide a first class service on every level

Working with Tory and the team at Panthera is an absolute joy - they provide a first class service on every level; from simple Xero issues through to more complicated tax enquiries, they’re always on-hand to help me get it right. I’m certainly not their biggest customer, but I’m always made to feel like their most important one.

John Baker BKR Solutions
John Castle

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I would like to say that Panthera Accounting have helped me with my business accounts for more than 4 years now. They have consistently offered an excellent competitively priced service that works both professionally and in such a friendly way that I would highly recommend them to everyone considering using their services.

John Castle Ilexanna Limited & Birch Castle Homes Limited
Jonathan Morrison

They are always there to answer queries and sort out issues

I had been with Mr Dunn for 20 years when upon his death Panthera took over the business. They now play a bigger part in the running of my business, they do all the stuff that has to be done but I don't like doing ie book keeping, VAT, wages, and returns. They are always there to answer queries and sort out issues and make sure all Tax deadlines are met. Their costs are fair, service is great and I have and would highly recommend them.

Jonathan Morrison Wallingford Builders
Pippa Scott

Professional, friendly and personal service.

Panthera Accounting have gone above and beyond the call of duty to guide and support our Company. They offer a professional, friendly and personal service that can take the stressful and sometimes frightening feelings out of running a business. They have guided us through the working of Xero and have offered “teaching sessions” on the day to day running of the accountancy package. Our only regret is that we didn’t join their team earlier.

Pippa Scott Scott's Commercial Services Limited
Sara Southey

Panthera puts the personal back in to accountancy!

Tory and her team have provided a friendly, approachable and helpful service from the start. They have delivered a quality service, above and beyond anything I could have expected. Panthera, with the help of the Xero package, have taken the stress, strain and confusion out of managing my company and personal accounts. I look forward to working with them for many years to come.

Sara Southey Bluestones Garden Design
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Panthera are fantastic.

Panthera are fantastic. Always professional, going the extra mile for their clients and delivering superb service. I recommend them all the time to my clients.

Tracey Miller Bigger, Brighter, Bolder BBB

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