Press Release: Poppleton and Appleby issues time to pay warning

Business owners have been warned to keep on top of tax payments after tax bills were highlighted as one of the biggest killers of small to medium sized businesses.
Birmingham and Coventry-based insolvency firm Poppleton and Appleby has revealed that in the overwhelming majority of cases where businesses have become insolvent HM Revenue and Customs is listed as the main creditor.
The problem has been heightened by the fact HM Revenue and Customs is rejecting an increasing number of Time to Pay (TTP) arrangements – traditionally used to give businesses leeway if they fall behind on quarterly tax payments.
A total of 3,390 TTP requests were refused in the first three months of 2011, in comparison to 2,440 in the same period in 2009 and 2,360 in 2010. The number of requests agreed has dropped dramatically, with 32,900 agreed in the first quarter of this year, compared with 82,000 in 2009 and 57,800 in 2010.
Martin Coyne, partner at Poppleton and Appleby, believed the reason for the increased number of refusals was due to HM Revenue and Customs taking a tougher approach.
“These arrangements were initially promoted during the recession as a way of helping businesses through the tough economic times.
“However, HM Revenue and Customs is now taking a tougher stance with the view that businesses should pay their tax in full and on time.
“It appears the majority of businesses which are being turned down for TTP arrangements are organisations which have previously applied – so the warning is not to assume you will be granted a TTP arrangement just because you have had one in the past.”
Another factor leading to the demise of many businesses is the failure to react to potential problems with tax payments at the earliest opportunity.
“We have certainly had instances where people have come to us far too late in the day but if they had approached us earlier we would certainly have been able to help them avoid liquidation.
“There are a number of options available to companies struggling with tax payments including potential refinancing of the business and we have also found that organisations like ours are often in a better position to agree TTP arrangements on behalf of companies.
“Our advice would be to seek expert guidance and advice at the very first sign of trouble.”
ENDS

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