BusinessBusiness RecoveryOnly a “handful” of businesses use taxman’s new review system

Only a "handful" of businesses use taxman's new review system

Company reviews conducted by insolvency practitioners sees just a handful of submissions since its introduction

JUST A “HANDFUL” of businesses have asked insolvency practitioners to review their books ahead of asking the taxman to delay their bills. HM Revenue & Customs had launched the review service last year, which it expected would be used by several hundred businesses.

From 6 April 2010 large organisations requesting its tax to be deferred under the Time to Pay scheme would have to commission an insolvency practitioner to write up an Independent Business Review.

The taxman said in a consultation at the end of 2009 it expected 300 to 400 businesses to use the new review system.

However a senior level insolvency practitioner told Accountancy Age there had been just four IBRs in the past ten months.

Large companies with a turnover of more than £1m need to submit an IBR to HMRC if it is requesting to defer its tax payments. The taxman published a list of approved insolvency firms to conduct the IBR including, the Big Four, Baker Tilly, Begbies Traynor, Smith & Williamson, and PKF.

A spokesman for the taxman said: “HMRC will not always require an IBR in £1m+ cases, this is because each Time to Pay request is considered on its own merits and the specific facts in the individual case.

“HMRC has only required an IBR in a handful of cases since the initial announcement in the last pre-budget report that HMRC would consider seeking such a review in those cases where additional “time to pay” was being sought and the tax involved exceeded £1m.”

 

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