If
you are looking to pay off oneous tax or vat
bills we have a great solution to suit your
individual circumstances.
Crown
Recovery - Tax Bill Solutions
Business
Bust to Business Boom -
Overcoming tax liabilities
Who
would have anticipated back in 2007 when businesses
were once flourishing and hitting their peak,
that they would now be facing such difficulties
that they are on the verge of being declared
bankrupt? With HMRC looming around issuing warnings
and threatening to take legal action for tax
arrears which are proving impossible to pay
in the current economic climate, businesses
are eagerly seeking a way out of the obstacles
created by the once reliable banking system.
The Inland Revenue’s launch of the ‘Business
Payment Support Service’ (BPSS) last November,
was hoped to be a ray of light through this
dark phase businesses are subsequently finding
themselves to be facing. But instead the BPSS
has proved to be more of a business tormenting
service than a supporting service whereby they
are inviting businesses to defer the looming
tax liability which in the interim continues
to build up by the day. A dangerous approach
when businesses are not using the deferred period
effectively, and are finding themselves in the
same or a worse predicament upon the expiry
of that period as they are finding the system
has not reduced the tax liability, but just
deferred the crisis it was previously facing.
A sector spokesman said that
“in many cases the fast track tax deferral
system is not an effective way to overcome the
tax burden…in fact it can make the problem
bigger than what it initially was. It is for
this reason our tax specialists and in house
legal team are able to effectively renegotiate
and agree terms directly with HMRC to set up
time to pay plans which are realistic and more
favorable to these struggling businesses to
enable them to rise from their falls”.
Of course businesses can attempt
to come to an arrangement themselves, but often
its back to square one soon after due to the
lack of support provided by HMRC. A sector spokesman
stated that “in order to help these businesses
overcome their tax liabilities it’s vital
for tax specialists to produce a viability report
of the business with a realistic view of their
ability to repay the outstanding debt. We often
find that around 40% of clients requiring our
service have been issued with legal proceedings
by HMRC as they have not been able to generate
the capital in the short deferment period which
has proved to serve no purpose, and require
a trained tax specialist to renegotiate the
arrangement with HMRC”.
For practical purposes a business
with outstanding tax arrears has 2 options to
avoid the possibility of becoming bankrupt.
Firstly, it can take the risk of entering the
BPPS scheme and put together a plan to repay
the tax often expected in a lump sum after the
deferred period to prevent any legal proceedings
being issued, or alternatively seek professional
advice from tax specialists who can assist businesses
in financial hardship clear their tax debts
while allowing them to continue trading and
once again head towards the boom.
Tax arrears are therefore a real and serious
problem effecting thousands of businesses nationally.
Whichever path a business takes it is important
to take action now as fundamentally HMRC do
have the power to wind any business up.
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