Time to pay scheme extension ‘will protect firms from insolvency’

Posted 10/12/2009

The government’s decision to extend its tax relief system for small businesses has been praised for the role it will play in protecting companies against the threat of insolvency.

John Whiting, tax policy director of the Chartered Institute of Taxation (CIOT), welcomed the agreement to prolong the HM Revenue & Customs (HMRC) time to pay scheme for “as long as needed”.

The charity highlighted the fact that 160,000 companies have already used the initiative to defer their tax charges in order to stave off insolvency and that most have since upheld the terms of their payment agreements with HMRC.

Mr Whiting stated that the lengthening of the scheme will therefore bring further aid to “businesses of all sizes”.

He said: “The extension of the scheme will help those businesses that need help to continue into the upturn.”

This extra time given to the initiative has also been welcomed by professional services provider KPMG, which stated that the scheme will give struggling businesses “vital time” to manage their various financial commitments.