Struggling firms receive help paying tax bills
More than 20,000 small firms have used HM Revenue & Customs’ (HMRC) Business Payment Support Service to defer their tax bills since it launched at the end of November 2008.
Announced in the Pre–Budget Report, the service helps struggling firms by allowing them to set up an affordable tax payment timetable. Under the scheme, HMRC will not apply any late payment surcharges where a deferment has been made, although interest will continue to be charged on outstanding amounts.
According to HMRC, more than £350 million of tax, including VAT, PAYE and National Insurance, has already been deferred.
The Association of Chartered Certified Accountants head of global taxation Chas Roy–Chowdhury said the service was of real benefit to businesses struggling to meet their tax costs in a difficult economic climate.
“It allows for flexibility in paying their taxes, ensuring their continued existence in the longer term,” he said.
Firms should take advantage of the service, he added, as HMRC interest rates on late payments were generally lower than those offered on the high street.
“Some people are unaware of the service and thus are missing out on the opportunities to ease their tax burdens.” said Roy–Chowdhury.
Taxpayers should be aware of the reduced interest rates on their repayments, with some rates such as income tax down to as low as 4.5%. From 27 January 2009, the rate of interest will be reduced to 3.5%.
Financial Secretary to HM Treasury Stephen Timms said the scheme was helping businesses across the UK to stay afloat and retain staff.
“I urge any business facing financial difficulty in these challenging economic times to pick up the phone and speak to an HMRC adviser. A short phone call could save hard–working businesses time and money.” he said.
For more information about the Business Payment Support Service, visit the HMRC website or alternatively call the Business Payment Support Line on 0845 302 1435
Alternatively, read our advice on Tax and Insurance.