Budget2011: Time to Pay lives on

THE CHANCELLOR has announced that the government’s tax deferral scheme Time to Pay will continue unchanged.

In 2010, HMRC rejected 5.8% of Time to Pay requests compared to 2.7% in 2009.

Steven Law, president of insolvency trade body R3, said: “Many businesses with short-term, one off cash flow problems have benefited from the scheme and on that basis we support its continuation.

“However, with a relatively low rejection rate of 5.8% in 2010 and with some businesses repeatedly asking for Time to Pay arrangements, we are concerned that a number of zombie companies are simply using the scheme to delay the inevitable.”

The scheme, which was introduced by the Labour government, was extended to continue until 2015 in last year’s budget.

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