This video describes how a Time to Pay arrangement works, and the different types of tax it covers. A TTP can help you avoid compulsory liquidation by the tax body and/or other creditors by reducing the pressure on working capital.
HMRC takes swift action against companies they believe to be insolvent, or that are deliberately failing to pay their tax liabilities. This is why you need to contact them promptly if you think your company cannot support the tax payments due.
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In addition to explaining the different types of tax covered by a Time to Pay arrangement, this video discusses its typical duration. TTPs include corporation tax, PAYE, and VAT, and can last for up to 12 months.
You must be able to keep up with your current tax obligations to be eligible for extra time to pay, however, and provide evidence of the company’s ability to pay the new instalment plan.
When you contact HMRC about a Time to Pay arrangement they will ask you the steps you intend to take to improve your cash flow, which forms part of their assessment prior to sanctioning or refusing a TTP.
You need to consider various factors when putting together a proposal for a TTP, including ensuring the company can maintain payments for the full term, and providing cash flow statements that back up your proposal.
For expert advice on HMRC Time to Pay arrangements, visit www.realbusinessrescue.co.uk
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