if theres one bill always make sure you pay....its this one dude!
Also you can pay by installments... so dno why they said no. If thats what you can afford then thats it! Write to them asking to pay by installments (so you have evidence for the court if they take you to court)
They won't let you pay by instalments if you have already fail to do so. This is for last years tax, so OP has already ignored at least 3 reminders, 3 extra chances to pay in instalments and 3 letters with the number to call where he can explain his situation and get a little leeway.