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Small Firms Facing Meltdown In Tax Time Bomb

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Small firms facing meltdown in tax time bomb

Thousands of firms are facing disaster because of a ticking tax timebomb.

That's the warning by an expert who says a Government scheme has simply postponed a wave of company failures.

The Business Payment Support Service was launched last November to help firms with cash-flow problems. It lets them to ask the inland revenue to defer or spread looming tax, VAT or national insurance payments.

Almost 150,000 firms owing £2.6billion have done just that. But Steve Clancy, of tax arrears specialists MCR, warns many bosses are storing up problems by not using the time to resolve the problems that got them into trouble in the first place.

Mr Clancy said: "Deferring payment can simply mean deferment of a problem. Yes, valuable time can be secured to put restructuring measures in place but companies are not taking advantage of this valuable time to put their houses in order.

"We may experience a surge of corporate failures."

An HM Revenue and Customs spokesman said: "We look at each case on its merits but we wouldn't agree to help a company which is obviously on its last legs.

"The vast majority of cases are helped and we are happy that most stick to the arrangements."

So how many businesses are operating like this? Will next wave of repossessions will be accompanied by a rout of small businesses?

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So how many businesses are operating like this? Will next wave of repossessions will be accompanied by a rout of small businesses?

This is another perfect example of the scorched earth economic policy currently being pursued by Gordon Brown. It's quite terrifying to watch them poison the well like this, with scant regard for the country or the public.

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This is another example of the govt walking on air like the wilde coyote and allowing people not to pay their way.

mortgage support

debt support

tax support

whats the point in paying? I pay and it hurts, but why should i pay when others can deffer for, er, ever? When will it end?

Its the same at all levels, better off on the dole, better of bankrupt.

better off in the folds of our evil government

If you offer defferment a huge percentage of companies will take it regardless!!! Its just another word for a loan, and, er, is it interest free these 'defferments'?

makes me sick.

whilst i support small business, i dont support business that should be dead. This is just a huge boost for fraudulent business people that start up companies, and dont pay tax and then vanish. Another free year please Gordon, please thankyou guv, your a star!!!

wish i could have some free money!!!

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mrblobbylb1.jpg

Excellent policy, we need more radical ideas like this to ensure economic stability.

Vote Brown.

Wibble

edit: correction: McWibble

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Guest sillybear2

If you cannot meet your future commitments, especially nonnegotiable one's like taxes, then you're essentially insolvent. Trading whilst insolvent is illegal, so Labour are essentially propping up thousands of zombie businesses and destroying the tax base, not to mention undermining genuinely solvent firms.

Edited by sillybear2

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If you cannot meet your future commitments, especially nonnegotiable one's like taxes, then you're essentially insolvent. Trading whilst insolvent is illegal, so Labour are essentially propping up thousands of zombie businesses and destroying the tax base, not to mention undermining genuinely solvent firms.

exactly

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Interesting that HMRC "wouldn't help firms on their last legs".

I took advantage of this recently for my company, mainly because it's good cashflow management and I thought we might as well (we're growing fast actually - internet based).

I was appalled how easy it was to get approval - about 15 seconds, based on a pretty flimsy story. I know someone else locally who found the same thing. HMRC had no meaningful way in either case of knowing whether they'd ever get a penny back. Clearly the hands of Gordon are guiding the "decision making" process.

As it happens, on the funnier side, it all went wrong! We agreed on a series of monthly post dated cheques and discussed the practicalities of that. I duly sent them in but was upset to find a few days later that the useless twits had banked the lot immediately. It caused us no problem really but what goes round comes round, I guess...

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If you cannot meet your future commitments, especially nonnegotiable one's like taxes, then you're essentially insolvent. Trading whilst insolvent is illegal, so Labour are essentially propping up thousands of zombie businesses and destroying the tax base, not to mention undermining genuinely solvent firms.

Don't worry we can borrow some more money from future new businesses to prop up these businesses.

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We need the businesses more than we need the Government, I say let the Government go to the wall, not the small firms.

The trouble is 'We' are not in charge even if no one votes because they are sick of them all.

We are the sheep that don't have the balls to stand up and say NO.

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Company failures = Higher unemployment = Higher house prices.

Oh doo doo :(

Slight error there, should read....

Company failures = Higher unemployment != Higher house prices.

:P

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A lot of businesses operate on very small margins. Tesco on some 2%.

Thus if their costs increase 2% they go from a profit to a loss.

For tesco it isnt a big deal as they can pass the increase onto customers but a lot of small businesses cannot.

Edited by cells

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This is another perfect example of the scorched earth economic policy currently being pursued by Gordon Brown. It's quite terrifying to watch them poison the well like this, with scant regard for the country or the public.

<pedantry>

Scorching the earth doesn't actually affect wells.

Because they're below the surface.

</pedantry>

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Slight error there, should read....

Company failures = Higher unemployment != Higher house prices.

:P

Yes, I know this, you know this, and 99% of us on this forum know this, but Rinoa has convinced me otherwise :P

For future reference, so you don't make the same stupid mistake I've been making all these years:

The third law of bull(sh1t) economics: Unemployment up = House prices up

Edited by RajD

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The trouble is 'We' are not in charge even if no one votes because they are sick of them all.

We are the sheep that don't have the balls to stand up and say NO.

But eventually either the parties themselves will work out not to destroy the country or a new party will replace them who have worked it out, which people will vote for.

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