There was a 45 per cent rise in the number of businesses which had their assets seized by HM Revenue & Customs (HMRC) in the year to March 2018, according to new research.
In an attempt to clampdown on businesses not paying tax on time, HMRC seized assets from 2,833 business in 2017–18, up from 1,953 the year before. Under current rules, the Revenue can take business-critical assets, including IT systems equipment, which are then sold onwards.
The “increasingly aggressive debt collection policy” is putting businesses at risk, as the stringent approach is hampering their ability to operate, leading to calls for a review of the approach.
A spokesperson for the report comments: “HMRC is jeopardising the future of these businesses by removing their assets. There may be a better way for HMRC to recover the tax than removing a business’s vital assets. Cashflow difficulties that mean a business cannot settle its tax bills should not spell the end for them.”
Speaking to City AM, an HMRC spokesperson says: “Taking control of assets from a debtor is never our first choice – we always look for payment in full or a satisfactory time to pay arrangement before proceeding to remove goods.”
Brexit uncertainty, fluctuating exchange rates, and rising costs are all causing cashflow concerns for UK SMEs. It is therefore essential that business owners maintain effective management of their company’s working capital and put processes in place to survive and thrive in challenging times.
Whether you are in business as an individual or as a corporate, you will want to ensure that you pay no more tax than you are legally bound to do. Our experts at Beavis Morgan can ensure your tax affairs are as efficient as possible to fit your circumstances, and we can look ahead to retirement and inheritance tax planning.
In addition, if you are concerned about a tax enquiry into your affairs, worried that you may have possibly under declared or, worse still, you are already under enquiry, our tax specialists, some of whom are former HMRC Inspector of Taxes, are well versed in dealing with all types of tax issues.
We are also readily available to oversee HMRC disputes on your behalf, as well as to represent clients in appeal proceedings before the Tax Tribunal. In some situations, we can also offer professional fee protection insurance, so the costs are covered in whole or in part.
For more information and to discuss your tax affairs in further detail, contact your usual Beavis Morgan Partner.
Through our partner businesses, BM Structured Finance and BM Advisory, we are able to help with sourcing and restructuring debt finance for SME businesses, as well as assisting with resolving issues which can impact on business performance and success, and finding innovative solutions for businesses and individuals in distress.