Insolvency practitioners will receive an estimated £11m in extra work after
the taxman announced plans to more strictly monitor requests for large
businesses to defer their tax bill.
HM Revenue & Customs
wants businesses requesting a Time to Pay arrangement for tax deferral of more
than £1m to pay for an independent assessment of their financial strength.
The taxman has struggled to cope with gauging the worthiness of large complex
businesses’ requests for a tax deferral.
An independent business review (IBR) will be undertaken by a qualified
professional adviser, expected to be an insolvency professional, of their
company’s financial strength. Around 250 businesses are expected to require an
The likely cost for a business will range from £10,000 to £75,000. The £11m
estimate is based on an average cost of £42,500 per business.
A panel of practitioners will be set up by HMRC to provide an IBR, and
guidance for them will published on its website. The new rules come into effect
from 6 April.
While HMRC acknowledges that the request for an IBR might discourage
businesses in genuine need of help, it expects this to be “minimal”.
R3 president Peter Sargent welcomed HMRC plans: “The panel of insolvency
practitioners will be well placed to conduct the IBRs and provide guidance
regarding the firm’s ability to pay the money back to HMRC.
“We are still concerned by the number of repeat deferrals, which have doubled
in the last six months and it would make sense to introduce some sort of control
for these businesses too.”
Making Tax Digital will impose significant additional tax compliance costs on small businesses for little or no medium term benefit, tax and small business experts told MPs
MHA MacIntyre Hudson has partnered with cloud accounting software provider Xero ahead of the government’s requirement for digital records
The drive towards a fully digital tax regime is an admirable one, but mandation is simply wrong, according to one of the UK's most senior tax technology practitioners - Paul Aplin
The second largest improvement in ‘significant’ levels of financial distress since the EU Referendum was in professional services, found research from Begbies Traynor