Clock Ticks on HMRC Time to Pay Scheme
January is all about making resolutions and getting the decks clear to make a good start to the year. However, businesses making use of HM Revenue and Customs’ (HMRC) Time to Pay scheme could be faced with more than they’d bargained for, warns cashflow specialist Bibby Financial Services.
Time to Pay, which launched a year ago, has helped more than 150,000 businesses delay their tax payments. However, with the Government’s tax deficit increasing by the minute, the HMRC is, understandably, looking for ways to recoup some of these unpaid taxes.
Edward Rimmer, Bibby Financial Services chief executive, UK and Ireland, said:
“It comes as little surprise that the HMRC is looking to take a tougher line with businesses to claw back some of these unpaid taxes and, even if the scheme does not completely come to an end – as has been reported in some circles – business owners should be prepared to have their finances and tax payments scrutinised much more rigorously.”
“But the last thing businesses need at the moment is to have the rug swept from beneath their feet so we urge all businesses owners to check as soon as possible they will be able to meet any payments and, more generally, that their finances are in order.”
“Indeed, many believe that the scheme has only delayed the inevitable failure of some businesses – the removal of the scheme now will mean its impacts are felt in the first quarter of next year, traditionally the toughest time for many businesses following the Christmas rush. With predictions from Begbies Traynor showing that the first quarter will see an increased number of insolvencies, and with time running out to make the most of other Government credit schemes, many businesses could be facing a very challenging start to 2010.”
Bibby Financial Services can help small and medium sized businesses who think they might be faced with a big tax bill come January, can work with business owners to look at all cash flow options and put together a remedial plan.
Edward Rimmer added:
“January is always a crucial month for businesses and it can often be make or break. With large amounts of excess stock from Christmas often left over, financial liquidity can take a big hit as cash flow is tied up in unsold stock, and many customer invoices are left outstanding.”
“We would urge businesses to ensure they do all they can – including keeping stock to a minimum – to ease pressure on their cash flow and allow them to flourish, rather than fail, this coming new year.”