HMRC business asset seizures jumps 45%
It is reported that the number of firms facing asset seizures by HMRC has jumped 45% from 2016/2017 and has increased more than fourfold since 2014/15.
This is yet more evidence of HMRC’s determination to collect the tax due and in doing so, ramping up the pressure on businesses that are already struggling.
This follows the Government’s consultation earlier this year where HMRC announced its intention to explore new legislation to assist in tackling the insolvency regime being used to avoid or evade tax. Our article posted earlier this year provides further details surrounding the consultation.
Matt Hardy, Insolvency Practitioner at Poppleton & Appleby said ‘Seizing assets of businesses, especially for business owners in the SME sector, means it is almost impossible to recover the situation and carry on trading. Once key assets have been removed, most businesses would be unable to continue trading and formal insolvency would follow swiftly.
In such scenarios those assets are unlikely to realise their full value and will likely leave the company still owing money to HMRC. Negotiating a payment plan in the first instance would allow for a better outcome for all stakeholders in the business; the key is making sure repayment plans are realistic and achievable and advice from a professional advisor can make the difference between survival and failure’.
Leaving payment of the tax bill until last is clearly no longer an option. We have come across many businesses in the past who have adopted this policy to gain breathing space, while struggling with cash flow issues.
How can Poppleton & Appleby help?
Our advice is for you to take advice early and talk to creditors; they are more likely to be sympathetic if it’s not too late. We can help negotiate on behalf of the business if the scenario has reached this stage.