Dealing with tax problems should always be prioritised. Interest, penalties and surcharges will be added and charged by HMRC if payments are not made by the due dates.
In the event of arrears accumulating, always take professional advice in order to agree a payment plan with HMRC. Communication is key. Always keep them fully updated on the Company’s financial situation so that you can continue to trade without the pressure from demanding letters.
There are various reasons why your Company may be experiencing tax issues. The lack of cashflow and the ability to pay the Company’s tax debs in a timely manner may be a sign that the Company is Insolvent.
Here are a few of the problems which can contribute to tax arrears with HMRC:
- Lack of accurate financial advice
- Delays in accurately registering with HMRC and obtaining the relevant tax reference number
- Not having procedures in place
- Lack of information in relation to regulatory requirements for Company Directors
- Managing the internal or external accounting systems
- Mistakes in recording accounting transactions which can lead to the way in which the tax figures are calculated
- Insufficient support in understanding the different types of taxes which may apply to your business
If all the above is reasonably under control and you have the required systems in place for your Company to trade efficiently then there could be other issues. Some of these can be difficult to solve and pinpoint and, in some cases, can lead to some serious problems with the Company. Here are a few causes to explore: –
- Poor credit management
- No hierarchy with the management team
- Trading conditions are difficult
- Lack of Capital investment
- Inability to make affective business decisions
- No business plan
- Lack of financial projections and forecasts
Next Step
If you want to find out anything further about this topic then please feel free to call on 0330 236 9930, 0330 236 9938 or 07961 116321. All conversations will be in strict confidence. You can also email me vee@navigatebr.com
This article is for information and interest only. It is not a substitute for full professional advice, which will take in to account the specific and individual circumstances. Navigate Business Recovery Limited cannot accept any responsibility for any loss arising as a result of any person or organisation acting or refraining from acting on any information
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