Author: Glenn

HMRC’s Time to Pay lets eligible taxpayers spread tax bills over time, avoiding immediate enforcement. 

If you owe tax to HMRC, you may be able to set up an online ‘Time to Pay’ payment plan depending on the type of tax debt and your circumstances. For self-assessment, you can create a payment plan online if you’ve filed your latest tax return, owe £30,000 or less, are within 60 days of the deadline and have no other debts or payment plans with HMRC.

For employers’ PAYE contributions, online payment plans are available if you’ve missed a payment deadline, owe £100,000 or less, aim to repay within 12 months and have no other debts with HMRC. Additionally, all due PAYE and Construction Industry Scheme (CIS) submissions must be filed.

If you owe VAT, you could set up a payment plan online if you missed the deadline, owe £100,000 or less, intend to pay within 12 months, have filed all tax returns and the debt relates to an accounting period starting in 2023 or later. Businesses on the Cash Accounting Scheme, Annual Accounting Scheme or those making payments on account are not eligible to set up a plan online.

For Simple Assessment debts, online payment plans are possible if you owe between £32 and £50,000, have no other debts with HMRC, and can pay it off within 36 months.

If you are not eligible for an online plan, you must contact HMRC directly. They will ask for details about your income, expenses, other tax liabilities, and any savings or assets, which they may expect you to use toward your debt.

HMRC will offer taxpayers the option of extra time to pay if they think they genuinely cannot pay in full but will be able to pay in the future. If HMRC do not think that more time will help, then they can require immediate payment of a tax bill and start enforcement action if payment is not forthcoming.

Know the rules for contractors & subs under CIS to avoid issues with HMRC.

Under the Construction Industry Scheme (CIS), HMRC applies specific tax rules to contractors and subcontractors in the construction industry. Contractors are responsible for deducting tax from payments made to subcontractors and forwarding it to HMRC. These deductions act as advance payments toward the subcontractor’s income tax and National Insurance.

A subcontractor is defined as any business or individual that agrees to perform construction operations for another business (a contractor or deemed contractor). This applies whether the work is done directly or through others such as employees or further subcontractors. Notably, a business typically considered a main contractor can be a subcontractor if hired by another contractor, such as a local authority.

Subcontractors can include:

• Companies, public bodies, partnerships and self-employed individuals.
• Labour agencies or staff bureaus that supply or employ workers for construction.
• Foreign businesses performing construction in the UK or its territorial waters.
• Local authorities or public bodies engaged in construction work for others.
• Gang-leaders who agrees with a contractor on the work to be done, and in turn receives payment for the work of the team.

Some businesses function as both contractors and subcontractors, paying others while also being paid for their services. These businesses must follow both sets of CIS rules depending on their role in each transaction.

Banks must now give 90 days’ notice before closing accounts, giving customers more time to respond.

Since April 2026, new government rules strengthen protections for individuals and small businesses at risk of unfair bank account closures. Under the legislation, banks and payment service providers are required to give at least 90 days’ written notice before closing an account or terminating a payment service, commonly known as debanking. A significant increase from the previous 2-month limit.

Banks are also required to provide a clear explanation for the closure, allowing customers to challenge the decision including through the Financial Ombudsman Service. These changes are designed to protect customers, particularly small businesses, who have often found their accounts shut down without notice or reason, leaving them unable to operate or seek alternatives.

The new rules form part of the government’s wider Plan for Change, aimed at delivering economic security and supporting growth. The rules came into force for relevant new contracts agreed from 28 April 2026 onwards and also apply to the termination of basic personal bank accounts.

There are exceptions in cases where closure is necessary to comply with financial crime laws. Existing protections which prohibit a bank from discriminating against a UK consumer based on political opinions or beliefs remain in place.

SMI loans can help pay mortgage interest for those on benefits, but repayment is due when the home is sold.

Support for Mortgage Interest (SMI) is a government-backed loan provided by the Department for Work and Pensions (DWP) designed to assist homeowners receiving certain benefits in covering the interest on their mortgage or home loans. The loan is intended solely to help with interest payments on a qualifying mortgage or home loan, and repayment is typically not required until the property is sold, or ownership is transferred.

Interest on the loan is charged monthly using compound interest which means that the total amount owed will increase over time. Despite this, the SMI loan may still be a more affordable alternative compared to borrowing from banks or credit unions.

Before applying, individuals are advised to assess their financial situation. SMI may not cover the full mortgage payment and so applicants may still need to pay the remaining balance. Those who have missed payments, are managing other debts, or share ownership with someone not included in their benefit claim should seek professional advice prior to applying.

Eligible applicants may borrow against up to £200,000 of their mortgage if they receive working-age benefits, or £100,000 if they are on Pension Credit, this can increase to £200,000 in certain transitional cases. For joint mortgages, entitlement may be limited. There is no credit check for the SMI loan, so applying will not affect benefits or credit scores.

To apply, individuals must complete an SMI application form. However, it is recommended that they explore all available options first, including discussions with their mortgage lender and support services such as Citizens Advice.

A recent ruling has provided a timely reminder that substance trumps form in employment status disputes, and the mere insertion of a clause does not automatically change the employment status of workers. This case concerns an appeal by BCAL, a company that provides vehicle collection, inspection, delivery, and transportation services. The core dispute revolves around the employment status of hundreds of individuals who work as drivers for BCAL.

The standard-form contract contained a term that permitted the drivers to make use of a substitute. However, a central issue in this case was whether the substitution clause was indeed "genuine". 

BCAL instructs drivers via an app, and they generally have no choice over job location, number, or type, although they can decline jobs. However, the Tribunal found evidence of a practice of punishing drivers for refusing work on available days. BCAL sets the fees for each job, with no power of negotiation available to drivers, and drivers are obligated to pay weekly administration and insurance contributions. BCAL pays for and issues DVLA trade plates to drivers, which are essential for driving unregistered/untaxed vehicles for business, and the drivers cannot obtain these themselves. Drivers are provided with branded items in the form of a badge, a hi-vis vest, a phone with an app, a fuel card, inspection equipment, and PPE. Newly recruited drivers must undertake a mandatory four-day in-person training course and receive a detailed training manual, which is regularly updated.

The Tribunals both found that the substitution clause in BCAL's contracts was not "genuine". This case strongly reiterates that the written terms of a contract, particularly a substitution clause, are not conclusive when determining employment status, as tribunals will rigorously examine the true intentions of the parties and the reality of the working relationship. If a contractual right, such as substitution, is not genuinely intended to be exercised or is an "unrealistic possibility" in practice, it will be disregarded.

Companies cannot simply insert a substitution clause into their contracts and assume this guarantees self-employed status. Instead, the right to substitute must be genuine, practicable, and exercised. This ruling carries profound importance for companies that employ people remotely via apps, as merely inserting a clause to infer that such employment is truly flexible can be overturned if it isn’t exercised.