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HMRC internal manual

Debt Management and Banking Manual

Time To Pay: Time To Pay requests: deciding which information to gather

The information that you gather will vary based upon the customer type that you are dealing with.

There are several Negotiating Frameworks and forms available to use. These are designed to help you gather the appropriate information that you need to consider when deciding if you can agree to a Time To Pay (TTP) request.

Individual debt or a business debt

You are very likely to use either an Income & Expenditure form or the Debt Pursuit Negotiating Framework when dealing with a Self Assessment debt. Generally these debts are owed by individuals.

When considering TTP for the business taxes (PAYE/CIS, CT and VAT) you would generally use the Business Debt Negotiating Frameworks or the Corporate Debt Questionnaire. However a business debt can be owed by an individual, a partnership, a company a trust etc.

To ultimately determine which framework to use you will need to consider more than the type of tax owed and the legal entity that owes the money and look at the customer’s current situation to determine what information to gather.

Ceased businesses/customers

Where a customer has ceased trading and is in a situation where they are unlikely to have further tax liabilities and debts you can base any TTP arrangement on their ability to pay. Timescale is less important in these cases as there is little worry that the customer’s debt will increase.

Where a business has ceased to trade (or de-registered in VAT cases) you would generally not use the Business Debt Negotiating Framework or the Corporate Debt Questionnaire as a basis for discussion. These forms are aimed at discussing the current trading position of a business and it medium to long term viability and as the customer has ceased trading some of the questions are no longer appropriate.

Instead you would use the Individual Debt Negotiating Framework or the Income and Expenditure form in order to establish if the customer can pay and what their proposals are.

Irrespective of what form is used we should be obtaining enough information to determine

  • why the customer can’t pay
  • what they have done to raise money themselves
  • how they intend to pay the debt and how have they worked out they can afford this
  • what changes they are making to ensure that they can pay future liabilities on time.