Group News
UK Budget Announcement: What HMRC’s strengthened debt recovery powers mean for businesses
Every Budget brings change, and this year’s announcements include a shift in HMRC’s debt recovery powers that could have real implications for SMEs.
Commenting on the changes, Joe Douglas, Associate Director - Business Advisory, said:
“Extending HMRC’s powers to recover lower-value tax debts directly from bank accounts, through regular instalments and without a court order, marks a significant shift in how tax debts are recovered. For many small businesses, cash flow is already tight. Money being taken from an account could leave them unable to pay wages, suppliers or rent, turning a short-term problem into a much more serious one.
“HMRC needs to collect the tax it is owed, and there is a clear case for tackling those who can afford to pay but repeatedly ignore their debts. But there is a difference between a business that refuses to pay and one that is struggling to keep up. Many otherwise viable businesses have fallen behind with their tax after several difficult years of rising costs, and sensible and affordable Time to Pay arrangements have played an important role in helping them recover rather than fail.
“Allowing lower-value tax debts to be repaid in smaller, more regular instalments could help businesses manage their cash flow, provided repayments are genuinely affordable and appropriate safeguards are in place. The real test will be how these powers are used in practice. If they are applied too bluntly, there is a risk of pushing businesses that could have been saved into insolvency.”
Supporting businesses with HMRC arrears
Our Business Advisory team has more than 25 years’ experience negotiating HMRC Time to Pay (TTP) arrangements for clients across the country. Over the past decade alone, that expertise has secured more than 970 arrangements, restructured £327 million of HMRC arrears and helped protect more than 60,000 jobs.
We champion proactive debt management because the earlier a business seeks support, the more options remain available. Early engagement gives our specialists the best chance of negotiating affordable repayment terms with HMRC, protecting businesses from unnecessary strain and keeping more doors open.
Get in touch
If arrears are building, the sooner that conversation happens, the more options available.
For more information about how Leonard Curtis can support you or your clients with HMRC arrears, get in touch on 0161 835 1900 or email hello@leonardcurtis.co.uk.
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Leonard Curtis is a trading style of Reach Commercial Finance Limited, registered at Leonard Curtis House, Elms Square, Bury New Road, Whitefield, M45 7TA. Company Register number is 09056450. Reach Commercial Finance Limited is authorised and regulated by the Financial Conduct Authority, FRN: 753686. Reach Commercial Finance Limited is an authorised credit broker and not a lender. We work with an unrestricted number of lenders to find a potentially suitable arrangement for your consideration. ICO registration ZA069234 and you can check via www.ico.org.uk. We will receive commission from lenders. Different lenders pay different amounts depending on different commission models. For transparency we work with the following commission models: fixed fee, fixed rate of commission, percentage of the amount you borrow and rate for risk (this is based on the risk profile of the business). Further details of the commission model, calculation and amount will be disclosed to you throughout your customer journey. Privacy notice.
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