Loan for Income tax

Djingle

Hi all,

Very quick question. Can I take out a personal loan to pay off my Income tax bill? Or will this be seen as used for business?

I am on a 12 month payment plan to pay off income tax, but frankly this is not achievable, hence wanting to take out loan over 5 years.

Thanks in advance!

somethingcorporate

If you take a 5 year loan out to cover a 1 year bill what happens next year when you are faced with the same bill again?

What did you do with the tax you were supposed to put aside?

Djingle

somethingcorporate wrote: »

If you take a 5 year loan out to cover a 1 year bill what happens next year when you are faced with the same bill again?

What did you do with the tax you were supposed to put aside?

That's a whole separate question...

Really looking for an answer for the original one!

Thanks

[Deleted User]

Yes you can.

imoneyop

Djingle wrote: »

That's a whole separate question...

Really looking for an answer for the original one!

Thanks

But it is a question that any sensible lender is going to ask.

If you can't afford to pay the income tax that you owe now, how will you be able to afford to pay the loan back and the future income tax.

Fruit_and_Nut_Case

Djingle wrote: »

Hi all,

Very quick question. Can I take out a personal loan to pay off my Income tax bill? Or will this be seen as used for business?

I am on a 12 month payment plan to pay off income tax, but frankly this is not achievable, hence wanting to take out loan over 5 years.

Thanks in advance!

Why would it be seen as used for business? Are you planning to tell a potential lender that it is? Have you omitted a vital piece of information from the OP?

Djingle

Fruit_and_Nut_Case wrote: »

Why would it be seen as used for business? Are you planning to tell a potential lender that it is? Have you omitted a vital piece of information from the OP?

I have a feeling a personal loan can be used for car, holiday, home improvements etc etc. BUT, not for a business expenditure ie tax etc

Most online loan forms ask what the loan is needed for. Hence the question.

Mattygroves2

Unless your business is a limited company then paying your income tax is a personal expense. If the tax liability is for a limited company then it should be the company taking the loan.

Suggest you are honest with the loan company and tell them it's fir a personal tax payment which is what it is (assuming no ltd co).

You do need to sort out how you're going to solve this though for future years as HMRC won't remain patient.