Thousands of businesses in the UK are being hit by cash-flow problems as the credit crunch bites deeper.
And as a result they face the prospect of being “fined” if they are unable to pay their quarterly VAT bills on time.
The taxman often forgives firms for first-time offences but can impose hefty surcharges of up to 15 per cent on those who persist
ently miss payment deadlines.
Now city accountancy firm Rawlinsons is urging companies affected by the current economic slow-down to urgently contact HM Revenue & Customs and negotiate a late payment agreement.
Firms can achieve concessions, especially in cases where the cash flow problem is likely to be short-lived.
Rawlinsons advise: “The first time you are late making a payment of VAT it is possible that no surcharge penalty will be payable. But after that any further late payments will trigger surcharges rising from two per cent to 15 per cent of the VAT outstanding.
It adds: “The key is to let HM Revenue & Customs know what your situation is. You mustn’t bury your head in the sand waiting for the bailiffs. Also, you could consider one of the special schemes offered, like cash accounting or the flat rate scheme.
“All businesses are different. A little research into the options available to you may go a long way to help you ride out the current cash crunch.”
n Rawlinsons is happy to discuss any difficulties your company may be experiencing due to cash flow issues. If you have a query, call Ken Craig on 01733 568321.
The full article contains 268 words and appears in Peterborough ET newspaper.
