Your Income Tax and VAT bills are considered priority debts. This means that if you don’t pay them, HMRC can take enforcement action to get the money you owe.
What to do if you're struggling to pay your Income Tax bill
It’s important to contact HMRC if you’re going to struggle to pay your tax bill. If you don’t pay it on time, you’re likely to end up paying interest and fines on the outstanding amount.
HMRC might also:
- collect the amount you owe straight from your earnings or pension
- get a debt collection agency (bailiff) to recover the money, often by taking and selling things you own if you live in England, Wales or Northern Ireland
- take money from your bank account or building society, if you live in England, Wales or Northern Ireland
- take you to court
- make you bankrupt or close your business.
If you have an outstanding payment, or are worried you might miss a future payment, call the HMRC Time to Pay helpline on 0300 200 3822.
You can also create a Time to Pay arrangement using you online Government Gateway account.
Find out more about the Time to Pay schemeOpens in a new window on GOV.UK
If you can not afford your tax bill
If you can not afford to pay your tax bill, you need to contact HMRC as soon as possible by calling the Self Assessment payment helpline 0300 200 3820. This service is for everyone, not just businesses.
What you need to prepare when asking HMRC for help
You’ll need to suggest how much you can afford and over what length of time you can make the repayments.
To come up with this, make sure you:
- work out how much you have coming in and note down any risks to your income in future
- make a budget – making sure you can cover any living costs and other priority debts
- come up with an amount that you’d be comfortable paying back every month
- using that monthly figure, work out how long it would take to pay off.
Join our Cost of Living Facebook group
Join our private Cost of Living Facebook groupOpens in a new window to discuss all things family finance, from the rising cost of living, benefits, debt or talking to your children about money.
If your situation changes, you can call them again to explain the situation and suggest a new repayment plan.
If HMRC don’t agree to your repayment plan ideas, they’ll use the information you gave to come up with another repayment arrangement.
Make an emergency budget
If you’re worried about cashflow, have a look at what you’re spending and what income you have coming in.
Budget planner
To help you manage your money, try our free and easy-to-use Budget planner.
You can also look at ways to reduce your household bills, such as switching providers for your gas, electricity or mobile phone contracts.
Find out how to save money and increase incomeOpens in a new window to help you catch up with your payments on the StepChange website.
Use the benefits calculator to make sure you’re claiming all the benefits you’re entitledOpens in a new window on the Turn2 us website.
Our guides on Budgeting section have tips on how you can cut back on household bills and living costs
When to get debt advice
- See our guide on How to prioritise your debts to help you work out which ones to pay off first.
- For more information visit Citizens Advice on how to make a plan to pay your debtsOpens in a new window
- If you are on a low income and can’t get the help you need from HMRC, TaxAid offers free confidential advice about tax.
Are you struggling with payments?
Use our Debt advice locator tool to find free and confidential debt advice online, over the phone or near to where you live.
Extra support if you’re struggling financially and with your mental wellbeing
Having mental health issues might mean that you struggle to make the best money-based decisions for you, as well as act on them.
Find help
If you’re feeling very low or suicidal because of your money worries, talk to someone. Call 999Opens in a new window if you’re in immediate danger or give the Samaritans a call on 116 123Opens in a new window.
Find practical tips on how to manage financially and where to get free specialist help in our guide Money problems and mental wellbeing
Remember, if you’re struggling financially and with your mental wellbeing, it’s worth getting in contact with your bank, building society, lender or whoever you owe money to, to discuss your options.
However, picking up the phone and talking about your problems is often easier said than done when you’re struggling with your mental health.
Check out our guide to get practical tips on How to have a conversation about money
Most places that you owe money to have policies about supporting you if you’re vulnerable. But they can’t help you unless you ask.
For some general tips on how you can manage your mental healthOpens in a new window check out Rethink’s guide. It covers everything from setting a budget to getting help if you, or someone you care about, is having a mental health crisis.
