Negotiating time to pay at the end of a tax investigation forms a key element of the work that we do. Below were explore some of the key elements. When a tax investigation is closed, often the primary concern is ability to pay. Clearly HMRC’s objective is to secure a yield from the time engaged in dealing with the tax investigation and moreover to ensure that the resultant tax due is collected quickly. The Inspector who has conduct of the tax investigation has responsibility for establishing that the correct tax has been paid. They are also responsible for quantifying any tax that has been lost and facilitating the process for collection. This will generally be via contract settlement.


However, the Inspector is not responsible for collection of any duties due resulting from the tax investigation. This matter falls squarely within the remit of HMRC recovery. Generally any duties due from a tax investigation will be added to HMRC systems outside of self assessment. A tax bill will be produced as part of the agreed settlement via contract and a separate charge created. This tax investigation charge will be notified to HMRC recovery who will then commence recovery proceedings. Obviously HMRC’s first objective will be to collect the tax in one installment. Usually within 30 days. However, as with many areas of tax investigation work, there is no such thing as a perfect circle. Often taxpayers who have been subject to an HMRC tax investigation have not made provision for any tax due. This is where a tax investigation time to pay arrangement comes into play.


Negotiating time to pay should form a key part of the work done by your appointed tax investigation specialist. Ideally ability to pay should be flagged up as early as possible during the tax investigation process. This will ensure that that negotiations run more smoothly when the tax due is actually quantified. A completed statement of assets and liabilities will be a key element in any HMRC decision. Securing time to pay can often be a complex and difficult area to navigate. For that reason you should always seek advice from a tax investigation specialist. Many, including ourselves, are happy to offer free tax investigation advice as part of an initial consultation.

We have written detailed guidance on tax investigation settlements and closure issues in the articles listed below. If you have any questions regarding this blog or indeed wish to discuss any of our other tax investigation services then please call us on 0330 999 5000.