If you have a tax liability that you can not pay the worst thing that you can do is avoid the demand. Even if the demand from the Inland Revenue is a mistake you should be proactive and contact your local tax office to rectify the mistake. If you can not afford your tax bill you should still contact the Inland Revenue as you may be able to come to an arrangement with them.
How to check your Tax Return
Before you contact the Inland Revenue, go over your tax return to make sure that you have not input an incorrect digit or made an obvious mistake. Also check to make sure that you did not complete using provincial figures, as if you have you will need to amend it to take account of the actual figures.
If your tax bill is higher than you thought it may be, it could be due to penalties and/or fines. If you have a reasonable excuse, any fines can be contested and if accepted they can be removed from your bill, but again, you should not ignore them, even if they are wrong.
What to do if you Can’t Pay your Tax Bill
Every case is looked at individually by the Inland Revenue. If you can pay, you will be expected to pay immediately. If you can not pay you may be given extra time to pay either in instalment or as one lump sum.
Either way you should contact the Inland Revenue as soon as possible. They have a payment helpline you can call: 0845 366 1204 for help and advice on your circumstances. If you fail to contact the Inland Revenue, they may start to contact you and/or take legal action against you to reclaim any money owed. If you would rather speak to an independent organisation for advice you can contact TaxAid or the Citizens Advice Bureau.
If you ask the Inland Revenue for more time to pay your tax bill, they may accept but they will ask for details of your income, assets, savings and other expenses, depending on how long you require need to pay your bill. You will still need to pay interest on any amount that is owed.