Amidst an uncertain economic climate and the withdrawal of the final elements of government financial support, Leonard Curtis has seen an increase in enquiries about debt repayment plans available with HMRC.
Many businesses are still dealing with the economic fallout of COVID-19 and the war in Ukraine, and with ongoing supply chain issues across a variety of sectors and the continuing cost-of-living crisis, it is anticipated that there will be more tough times ahead.
For businesses in arrears with HMRC, there is a solution to ease cashflow pressures: Time to Pay (TTP).
How does Time to Pay work?
TTP allows struggling businesses to repay their outstanding Corporation Tax, PAYE/ NI or VAT liabilities in installments, rather than in one go. The business must be able to demonstrate how the amount owed can be repaid in the proposed timeframe with the available funds.
Our team has an exceptional reputation with HMRC and can help even if the business is further down the collection chain. We can even assist if the business has already had a Time to Pay proposal rejected, either from themselves or their accountant. In 2021, Leonard Curtis achieved a 100% acceptance rate with Time to Pay arrangements, totalling £9.5m in arears. Thus far in 2022, the team has had an acceptance rate of 97%, securing TTP arrangements with arrears totalling £18m.
There is no limit to the size of business we work with. So far this year, we have assisted businesses with turnover ranging from £150k to £30m, and arrears stretching from £35k to £2.3m.
Prior to March 2020, HMRC were only willing to accept deals ranging up to 12 months. However, given the extreme circumstances that have affected businesses globally, HMRC are willing to consider longer term deals.
This support is not anticipated to continue indefinitely, and we has seen a definite change in stance during 2022, with HMRC reducing the length of arrangements permitted and increasing their recovery action. This trend is expected to continue, so it is important that businesses address HMRC arrears as soon as possible.
A recent example of a longer-term deal that Corporate Strategies were able to secure for a client is detailed below.
Recent Example Engineering Company
- Precision engineering company t/o £2.5m.
- Directors agreed their own TTP due to difficulties arising during COVID but defaulted on current payments. Unable to agree a new arrangement themselves.
- Cashflow issues worsened due to increasing raw material costs and shipping delays arising from the conflict in Ukraine.
- PAYE and VAT arrears built up over three years (including post-TTP) of £192k.
- Corporate Strategies secured HMRC Time to Pay arrangement over 3 years.
HMRC are reducing their appetite for longer-term deals, therefore it is recommended that businesses secure arrangements as soon as possible.
For more information get in touch with the team on 0800 002 9969.
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Reach Commercial Finance Limited. Registered in England no 09056450. Leonard Curtis is a trading style of Reach Commercial Finance Limited. Leonard Curtis is a broker not a lender and is independent with access to the whole of market. We may receive commissions that will vary depending on the lender, product or other permissible factors. The nature of any commission model will be confirmed to you before you proceed. Authorised and regulated by the Financial Conduct Authority FCA no. 753686. Registered with the Information Commissioner’s Office reference ZA069234
Leonard Curtis Legal Limited is a limited company, registered in England and Wales with registered number 09820186. Registered office: Riverside House, Irwell Street, Manchester M3 5EN. Leonard Curtis Legal Limited is registered with the Solicitors Regulation Authority with number 626004.