HMRC rejects 6000 time-to-pay pleas

The taxman has knocked back more than 6,000 time-to-pay appeals since its olive branch to struggling companies began last year, Accountancy Age has learned.

Between 24 November 2008 and 25 October 2009, 6119 requests have been refused under the Business Payments Support Service, HMRC said.

The number is a fraction of the 220,000 arrangements the taxman has endorsed, but both statistics taken together put the treacherous conditions facing UK businesses into sharp relief.

As of 25 October, £2.81bn of the £3.87bn total has been repaid. This represents 90% of what HMRC had expected to receive by this point, meaning a shortfall of £300m.

The taxman said it was "acutely aware of the pressures people face when they are in financial difficulty – especially in the present situation," taking a sympathetic approach to businesses that have temporary difficulties in paying the tax they owe.

"Our customers have been very grateful for the breathing space. HMRC is finding that the large majority of time to pay agreements are being repaid."

However, the tax collection agency warned action would be taken of those who defaulted after being granted a time-to-pay arrangement.

"There is no ’clamp down’ as such on those who breach the terms of a time to pay agreement."

"But HMRC takes a very dim view of debtors who reach agreement with us to pay their tax debts over an extended period and then fail to comply. In such cases they should expect HMRC to take firm action to recover the debt."

Further reading:

HMRC risks £2.4bn on deferred tax bill