Spreading your January self-assessment payment

Anna Stubbs • January 18, 2024

With a combination of low growth and high inflation, the 2022/23 tax year has been a tough time, financially speaking, for many of us.


So it’s no surprise that many owners, directors and self-employed individuals are concerned about having enough funds to pay their self-assessment income tax bill.


The good news is that HM Revenue & Customs (HMRC) does have a facility for spreading out your income tax payments. HMRC’s ‘time-to-pay’ arrangement allows you to pay your tax bill in pre-agreed installments, with a small amount of interest added on for the use of this service.



Where the amount due doesn’t exceed £30,000, you can apply online; otherwise you will need to contact them to discuss what arrangements can be put in place.

How does the time-to-pay scheme work?

The time-to-pay scheme relates to HMRC’s online payment plan service, allowing you to come to an agreement about deferring your tax bill and spreading the costs over several months.

For your 2022/23 tax return, you can spread the balance of your 2022/23 liability as well as the first payment on account towards the 2023/24 tax bill.

Some other considerations of the facility include:

  • Interest will be charged from 1 Feb 2024, at base rate plus 2.5% p.a.
  • You need to choose how much to pay initially and how much you will then pay monthly.
  • If a payment is missed, the whole amount can be demanded by HMRC.
  • If an arrangement is set up, this avoids any enforcement action to collect your due taxes, ie. calling in debt collectors etc.


How to check if you’re eligible for online payments

So, how do you know if you’re eligible to set up a time-to-pay agreement with HMRC? There are five criteria that must be met for HMRC to consider an online payment arrangement.


The five criteria are:

  1. The amount due must be between £32 and £30,000.
  2. There must be NO outstanding tax returns to submit
  3. There must be NO other tax debts
  4. There must be NO other active HMRC payment plans
  5. The length of the payment plan must not exceed 12 months


The deadline to set up online payments is within 60 days of the due date – in this case, 1 April 2024 for the last tax year and the first payment on account for the current tax year.


If you don’t qualify based on the five rules mentioned above, you can still apply for normal (not online) time-to-pay arrangements. It’s worth noting that time-to-pay arrangements don’t show up in credit searches – but if you default and it ends up with an Individual Voluntary Agreement (IVA) or County Court Judgement (CCJ) being made, that will obviously show up.


Talk to us about agreeing a time-to-pay arrangement


If you’re concerned about not being able to pay your January self-assessment income tax bill, please do come and talk to us. We’ll review your financial situation, your liquid funds and will work out how much you can realistically afford to pay.


Get in touch to talk about an online payment plan.

Should your strategy be defensive or growth-focused?

By Anna Stubbs • December 3, 2025
The latest edition of the Federation of Small Businesses’ (FSB) Small Business Index had some unexpected results when it comes to growth expectations of UK small businesses. 27% of businesses said they expected their business to shrink, close or sell up over the next year. This outweighed the 25% who predicted their business would expand over the same period. It’s the first time in the history of the SBI that expectations of contraction have outnumbered those of growth. And it underlines a growing trend.

Why it's smart to accept payments online

By Anna Stubbs • December 3, 2025
One of the best things about online shopping is instant, hassle-free payment. Enter your details, click, and you’re done. If your customers can make an instant online payment, they’re likely to pay you more quickly – and they’ll appreciate the simplicity too. The details Online payment methods include credit and debit cards, ACH (Automated Clearing House) services like Paypal, and repeat payments through direct debit. Payments are managed by merchant service providers – specialist companies that process transactions on your behalf. Some focus on credit and debit cards, while others stick to ACH or direct debit. Choose a provider that can integrate with your accounting software, and you can add a super-simple payment button to future invoices. The costs While your merchant service provider shouldn’t charge any set-up fees, they will charge transaction fees. These range from 2-4% of the invoice for debit or credit cards, and under $2 a transaction for direct debit. These fees are an added expense, so they need to be included in your profit calculation – smart accounting software will do this automatically. Because credit and debit fees can add up, many businesses don’t offer online payment for invoices over a certain amount. The benefits Businesses using online payments get paid faster. Of course, not every client will pay instantly just because they have the option, but it should speed up your average payment time.  A bonus benefit? Customers appreciate the ability to pay online, so offering it as an option can be a big point in your favour. Ready to reap the benefits of online payments? Get expert advice and set-up support from our accounting team.

5 challenges for small business - and how to beat them!

By Anna Stubbs • December 3, 2025
Starting, building and growing your own small business is a hugely rewarding experience for many entrepreneurs. But the road ahead isn't always smooth. There are common challenges that crop up and ongoing issues that need to be factored into your business plan, your strategy and your own personal thinking. So, what can you do to beat these challenges and make the journey as frictionless as possible?