HMRC Has Refused Time to Pay: What Can My Company Do Next?
Clarify what HMRC has refused, review the company’s ability to pay and identify any enforcement deadline. A revised proposal is not automatically accepted.
Published by Vanguard Insolvency · General guidance
Find out what has actually been refused
Start by recording the HMRC discussion, the tax references, the amount outstanding and the reason given for declining the proposal. An inability to use the online payment-plan service is different from HMRC considering and refusing a proposal. If the company cannot use the online service, GOV.UK directs it to contact HMRC.
Ask which figures or assumptions HMRC questioned and whether further information can be considered. Keep the response and any payment deadline with the company records. Do not describe a plan as agreed until HMRC has confirmed it, and do not rely on a request for another discussion as protection from recovery action.
Rebuild the proposal around reliable figures
Prepare a current forecast showing expected receipts, essential expenditure and new tax as it falls due. Include all creditors, not only HMRC. Use realistic collection dates and distinguish confirmed orders from hoped-for sales. A repayment figure needs to be supported by the cash the business can actually generate.
Explain what caused the arrears and what has changed. If a customer has paid late, show the evidence and expected receipt. If the problem is continuing losses, a longer schedule alone may not solve it. Our Time to Pay guide explains the information to prepare for a business proposal.
Check the enforcement stage separately
If the company cannot agree an instalment plan, HMRC may take recovery action. Identify the actual stage from the correspondence: a reminder, collection contact, enforcement notice or court petition should not be treated as the same thing. Keep every notice, including the envelope or electronic delivery information where relevant.
A hearing or formal enforcement deadline needs prompt attention in its own right. If a winding-up petition has been served, seek urgent legal and insolvency advice and use our petition advice page. Do not assume ordinary payment-plan discussions remove the court timetable.
Consider the wider business position
Where the company cannot meet its current costs as well as an affordable contribution to arrears, review the business as a whole. This may involve restructuring or assessing formal insolvency options with an appropriately qualified professional. There is no single procedure that follows automatically from a Time to Pay refusal.
Avoid filling the gap with new borrowing without assessing repayments, security and any personal guarantee. Bring the funding proposal into the same forecast. The useful question is whether the revised business can meet its commitments, rather than whether another payment can be postponed for a few weeks.
For Leeds directors seeking advice, send a short summary of the company’s position, the HMRC response and the next deadline. Our HMRC arrears service page covers the wider review. No adviser can guarantee that HMRC will accept revised terms.
Start with the facts
Prepare these details for a useful first conversation.
- Tax references and outstanding balances
- HMRC’s response and correspondence
- Forecast including new tax
- Any enforcement or hearing deadline
Questions about your options
No. It may mean the company cannot use that online service. GOV.UK says to contact HMRC if a payment plan cannot be set up online.
Ask HMRC what further information it will consider. Revised terms must be realistic, and acceptance is not guaranteed.
Do not assume it does. Court action needs separate urgent advice and confirmation of the actual position.
Related support
HMRC tax arrears advice
Assess tax pressure alongside the company’s wider financial position.
Sources checked 4 November 2026
- HMRC: setting up a payment plan
- HMRC: if a payment plan cannot be agreed
- Insolvency Service: company options
General information for companies in England and Wales. Individual circumstances and deadlines require professional advice.
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