HMRC Tax Debt

There are a number of options that can help a business that is struggling to meet its tax obligations. Certain corporate debt solutions may be more suitable than others depending on your circumstances, so it is best to get in touch with us to discuss your financial position and receive practical advice on how you can proceed. This will help you to plan the way forward for your business.

Time to Pay Arrangements

If you owe money to HMRC, you may be able to secure a Time To Pay Arrangement. This allows businesses to pay their debts in instalments over an agreed period of time, and is often suitable for organisations that have temporary cash flow problems, but are still fundamentally viable.

A business must propose payment terms to HMRC in its application for a Time to Pay Arrangement, and demonstrate to the tax authority that it has the ability to pay within the established time frame. It is important to seek expert support when making a proposal to have the best chance of securing the agreement. Thanks to our experience and our excellent relationship with HMRC, we can support your proposal, reduce pressure and help you pay your tax debt.

Business Finance

There are a number of business finance options that can help to release funds from your organisation and enable you to pay taxes on time. For example, with invoice factoring, a third party will pay you a percentage of the value of your outstanding invoices, and then collect the payments from your customers. If your business is experiencing cash flow challenges due to lengthy invoice payment terms, this may be a viable solution.

Other options include asset financing, which allows you to borrow money that is secured against the value of company assets like machinery or property.

The viability of any business finance mechanisms depends on your business’ individual circumstances, so you should speak to us about which course of action is most suitable for you.

Company Voluntary Arrangements

A Company Voluntary Arrangement (CVA) is an agreement between your company and its creditors (including suppliers, banks, HMRC and other institutions) that allows you to pay off business debts over a period of time while your company continues trading. You must apply through an insolvency practitioner, who will negotiate the agreement and encourage creditors and company directors to agree to fair payment terms.

CVAs can relieve HMRC pressure, lower monthly payments and centralise your debt, which can improve cash flow and allow your company time to recover. As with any company rescue solutions, it is important to act as soon as you notice a problem to ensure that you have as many other options available as possible.

Company Administration

If you have not worked proactively with creditors to negotiate terms and resolve your organisation’s debts, company administration may be the best possible option to rescue your business. We will only advise this path in the most serious cases – for example, if HMRC or other creditors are looking to close down your company to recover the money you owe.

In administration, you appoint an insolvency practitioner to take control of your company. They will make decisions with the aims of recovering the business and paying off outstanding debts. This may involve a continuation of trading, a sale of assets, a company restructure, or a sale of all or part of the company to a new owner.

While this route can relieve the stress and pressure of managing a tough financial situation, handing over control of your company is never the ideal outcome. It is always best to seek advice as soon as you can, because other company rescue options may be available. We will always explain every option to help you understand the decisions you need to make and choose the most viable path to recovery for your company.

Pre-Pack Administration Sale

If the business is unlikely to recover, a pre-pack administration sale of the business may be the best course of action. The company is put into administration and then immediately sold (along with its assets) to a third party according to a prior arrangement. This means that the business is transferred seamlessly: it can continue trading, uphold contracts, protect jobs and recover from financial difficulties.

Under certain circumstances, current company directors can purchase the business under a newly established company, but it is important to seek expert guidance to understand your options before pursuing any company rescue procedures.