| The number of companies
being refused more time to pay tax bills
has doubled, new figures have revealed.
Data obtained under the Freedom of
Information (FOI) Act shows that officials
at HM Revenue & Customs (HMRC) are taking
an increasingly hard line on businesses
requesting ‘time to pay’ their taxes.
HMRC’s Time to Pay scheme is designed
to enable viable businesses to defer tax
bill payments during the recession if they
are experiencing cashflow difficulties.
However, the FOI figures reveal that
more than 11 per cent of applications were
rejected by HMRC during the first quarter
of the year, compared to just 5.3 per cent
for the same period in 2009.
Struggling businesses are increasingly
having to take bank loans to pay HMRC VAT,
although experts have warned that SMEs are
still finding it difficult to do this,
meaning they are more likely to be hit by
HMRC’s increase in Time to Pay rejections.
Analysts have also argued that it is
too early in the economic recovery for
HMRC to start withdrawing help for
businesses struggling as a result of the
recession.
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