How To Use HMRC’s Self Assessment Time To Pay Service

Calls for government support for the self-employed have continued in the face of local lockdowns. And it seems like they’ve been listened to. There is some good news for those unsure if they can afford their…

5 Minute Read

Last Updated: 5th April 2023

Calls for government support for the self-employed have continued in the face of local lockdowns. And it seems like they’ve been listened to. There is some good news for those unsure if they can afford their 2019/20 Self Assessment tax bill: HMRC is enabling sole traders to spread the payments due in January 2021 over 12 months. This is known as the ‘Time to Pay’ scheme.

Using HMRC’s self-serve Time to Pay service, taxpayers are now able to set up a payment plan online. This payment plan will help sole traders break down their total bill into affordable monthly chunks. However, there are a few conditions…

Here, we explain exactly what the Time to Pay service is and how sole traders can benefit from it.

What is the Time To Pay service?

The Time to Pay service allows self-employed taxpayers to spread out the cost of their total tax bill over a period of 12 months. As it’s self-serve, sole traders paying a Self Assessment bill of up to £30,000 are able to set up their payment plan without needing to speak with HMRC. Those with a liability greater than £30,000 are still able to apply but will need to call HMRC first.

According to HMRC, 95% of Self Assessment customers who are due to make payments on 31st January 2021 could qualify to implement this arrangement without speaking to an adviser. That is, provided they meet the following criteria:

  • They have no outstanding tax returns, other tax debts or payment plans with HMRC
  • The debt is between £32 and £30,000
  • The plan needs to be set up no later than 60 days after the tax payment’s due date (30th March 2021)

It’s important to remember that HMRC will still be adding interest to all outstanding debts from 1st February 2021. Therefore, if you can afford to pay your tax bill on time, you may save yourself money in the long run by paying it all in one lump sum as opposed to instalments.

Who benefits from the Time to Pay service?

Any sole trader who is unable to afford their tax bill. This is especially true of sole traders who deferred their payment on account in July 2020 and now owe a larger sum in January 2021.

Back in March, HMRC allowed sole traders affected by the pandemic to delay their second payment on the account until 31st January 2021. While initially, this was a popular decision, for some sole traders, that now means they owe a significantly larger amount in January.

Obviously, they couldn’t have anticipated that we would still be in the throes of COVID-19 and the continued impact this would have on their business. For this reason, this group, in particular, is most likely to benefit from the Time to Pay scheme, as it allows them to break their total debt down into 12 instalments over the course of the year.

While this won’t change the July 2021 or January 2022 deadlines, it may still help affected taxpayers balance cash flow and stay afloat in the meantime.

How do I access the Time to Pay service?

Before you can access the Time to Pay service, you need to file your Self Assessment tax return. So, if you’re one of those who have yet to be convinced by the many benefits of filing early, now’s the time to listen up.

Once you’ve submitted your tax return to HMRC, you’ll be presented with your tax bill. From here, you can determine how much you want to pay straight away, and then how much you want to pay each subsequent month.

Bear in mind that if you don’t keep up with your repayments, HMRC may well ask you to pay the entire amount in one lump sum. That’s why it’s important to ensure that you input an amount you can realistically cover, even in the event that the pandemic continues to impact your livelihood next year.

Already filed? You can set up your payment plan by logging in to the Government Gateway today. Alternatively, you can call the Self Assessment Payment Helpline on 0300 200 3822 and talk through your options.

You can even use this service going forward if you prefer to make regular payments in advance of your deadline, effectively replacing the second payment on account.

How GoSimpleTax can help

At GoSimpleTax, we enable you to log your income and expenditure in real-time so that you can submit a stress-free Self Assessment tax return. No surprises, no hidden fees, our platform lets you see what you owe throughout the year and builds your tax return automatically. The best part? You can trial it for free by signing up today!

We understand how difficult it is for sole traders right now. That’s why our software helps calculate your tax bill in real-time and then, by upgrading to a full account, file directly to HMRC with ease. We even flag any relevant tax relief to you so that you can reduce your tax bill where possible while remaining on the right side of the taxman.

Sign up today and simplify your Self Assessment tax return.

Trusted by over 15,000 subscribers

You don't need to be an expert to complete your self assessment tax return.

Start your free trial

Blog content is for information purposes and over time may become outdated, although we do strive to keep it current. It's written to help you understand your Tax's and is not to be relied upon as professional accounting, tax and legal advice due to differences in everyone's circumstances. For additional help please contact our support team or HMRC.


Start your Self Assessment tax return today for free.

Sign up Now

20 common tax and accounting terms that sole traders should understand

06 Jun 2023

Although you’ll no doubt have an expert knowledge of your trade or profession, your understanding of tax and accounting could be fairly limited. That’s…

Seasonal business owners: 21 things you need to know about sole trader tax

05 Jun 2023

Some business ideas just aren’t viable throughout the year, because the weather at certain months seriously weakens demand or kills it altogether. However, running…

How much tax does a landlord need to pay? 10 key questions answered…

18 May 2023

The UK has more than 2.7m unincorporated landlords and each year they report to HMRC rental property income worth some £41bn. Unincorporated landlords are…

How GoSimpleTax Works


Simply register for free with your full name and email address.

Select Your Income

Select the income you receive and follow the hints and tips for potential tax savings.

Validate Your Information

Validate your personal information and submit directly to HMRC to get confirmation in just seconds.


Work Anywhere, With Any Device

Gone are the days of fretting over a calculator surrounded by scraps of paper at the eleventh hour.

GoSimpleTax’s tax return software uses the information you upload in real time to calculate your income and expenditure, working out the tax you owe and sending you helpful notifications when there’s the possibility of a mistake.

Start your free trial

"The software is intuitive and proved very easy to navigate. I found the whole process refreshingly simple. I saved a lot of money too!"

Steve J.

Ordained Presbyter

"Easy to use and value for money. Everything you need to do your tax."

Gordon J.

Self Employed

"It fills in all the forms and sends them to the Inland Revenue. Not expensive either. Takes the stress out of doing your tax return online."

Ross G.

Team Rector

Start your free trial