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Definition
Time to Pay is an arrangement with HMRC that lets a business spread a tax bill it cannot pay in one go over an agreed period. It is a valuable cash-flow tool for a viable business facing a temporary squeeze on a VAT, PAYE or corporation-tax payment.
In plain terms
Rather than defaulting on a tax bill and risking penalties and enforcement, you agree a payment plan with HMRC that fits your cash flow. Interest applies, but it turns a lump-sum shock into manageable instalments.
Why it matters
Approaching HMRC early, before a bill is overdue, gives the best chance of a workable arrangement. See planning around VAT and tax.
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