Small companies relying on the Revenue to defer their tax payments could be in for a nasty shock amid concern the bar to qualify for the respite from HMRC has been raised.
Although the scheme’s criteria for cash-strapped firms yet to contact the taxman remains the same, firms making repeat requests for more time to pay will see it has tightened.
Admitting as much, tax officials told the Financial Times that they were asking tougher questions of companies that had requested to defer their tax bill more than once.
The more rigorous assessment should please experts at P&A Partnership, who have criticised HMRC for giving firms 'tax holidays' without checking they can return from them in due course.
Suppliers’ exposure is now being minimised, however, where HMRC are asking directors to get the agreement of all their creditors before they enter into 'Time to Pay' arrangements.
These disclosures should allow parties other than the directors who have requested the tax breather to deduce whether or not the company is merely putting off its demise because of severe financial problems.
Addressing firms who wish to defer their tax bill, again, HMRC said: “If you already have a payment arrangement with us but have additional concerns about what you can pay, the office you've been dealing with will be able to discuss further options with you.”
Aug 4, 2009
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