No more Time to Pay threatens self-employed

HM Revenue & Customs’ decision to no longer publish figures relating to Time to Pay agreements could signal the beginning of the end of the tax deferral scheme.

Issuing the warning, enterprise group UK Business Advisors said any withdrawal of the HMRC initiative, run by the Business Payment Support Service, would threaten the very survival of “many” smaller traders.

Although HMRC has indicated Time to Pay (TTP) will stay “as long as there is [a] need” for it, the business experts pointed to three developments which each suggest to them that the respite from the taxman is being wound up.

Firstly, the number of agreements to spread tax payments has fallen to a third of the level it was - partly due to the second development - that HMRC have “made it clear that they will not allow repeat applications,” or applications from dividend-paying companies.

More recently, the tax authority announced it would no longer disclose statistics from TTP, “further threatening the survival of this [important] scheme,” added UK Business Advisors’ Chris Scanlon.

“No longer publishing figures for those seeking time to pay is another effort at cost reduction,” he said.

“However, the government’s dislike of key performance indicators seems to throw the baby out with the bath water. It may cost a little to produce them, but they are an important benchmark to measure performance improvements and deterioration, from which further actions can be made.”

More importantly than its use as a yard stick, he said Time to Pay should be kept in place so the smallest of businesses can continue to be helped through periods of economic turbulence.

 

22nd August 2011

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