HM Revenue and Customs completed 42% more investigations into tax issues on businesses in the 2010-2011 tax year, signalling a ‘tougher, more aggressive’ approach to full compliance, Pinsents Masons have suggested.
2010-2011 was the highest-yielding year for VAT compliance in the last five years as investigations have resulted in large amounts of cash being paid out by some of the UK’s largest companies.
HMRC has been subject to pressure from the government in a bid to increase collect-outs, with VAT and other business taxes likely to be important battlegrounds over the next few years, Steven Porter, an associate from the law firm indicated.
VAT inquiries often take more than a year to conclude, which could add to SME and small businesses’ red tape burden and also hamper growth plans and the ability to plan long-term.
Cashflow Assistance through Invoice Finance
If your owner-managed business has been struggling to find available cash to settle important tax bills, have you considered external finance solutions?
Invoice finance solutions such as invoice factoring and invoice discounting work to release cash you may have tied up in unpaid invoices, money that is rightfully yours but you may not see for between 30 – 90 days.
Ingrained late payment culture has really hit many businesses hard who need to keep their cashflow high.