HMRC are getting tough on overdue tax

Understanding HM Revenue & Customs

There was a telling interview of Nick Lodge, director of the HMRC Debt Management and Banking Directorate in the October/November issue of Insolvency Today magazine.  In it he said the following:

• That in 2009/10, his department had £87 billion passed to him for collection, one fifth of the Revenue's take, and they had only written off £5 billion as a result of bad debts. 
  
  
• 'We are not here to provide ongoing support for businesses that aren't otherwise viable. 
  
  
• This is not a bank overdraft or a loan'.  'We don't come at it from the point of view let's let insolvent businesses not pay their tax because that will keep people employed'.  'We are tax collectors'. 
  
  
• A deferral agreement over a short-term period, to get over temporary cash flow problems, is fine. 'But over a long period? Sorry, no.  You're not viable if you can't pay your bills, including your tax bills'.  

He then goes on to give an idea as to what we can expect going forward: 'We are improving fast overall at debt collection anyway, therefore businesses will increasingly see us being more active, pursuing debt more vigorously'. 

So you might get one of these -  >>>>>

So what does this mean for businesses? You need to show the HMRC that your business is viable. So what is the best way to show that if you are in an insolvency scenario?   Come to an agreement with your creditors in a legally binding company voluntary arrangement. 

Don't wait too long to get professional turnaround help. Call the experts on 01289 309431 or 0800 9700539

If your business has tax problems, like arrears of PAYE and VAT then the company is probably insolvent! You must act to do something about these problems and this guide will show you how. See our guide to “Is our company Insolvent”.