It has emerged that HMRC have shut down a staggering 12% more businesses than this time last year. This information correlates with their trend of ramping up investigations into unpaid tax. This, of course, has resulted in far more small businesses seeking expert help in the form of chartered accountants in North Wales and further across the field.
Not everyone evades tax in a criminal manner. Running a business is time-consuming and extremely stressful, and even the most honest of business owners may struggle to get to grips with HMRC’s Making Tax Digital system – something, which most believe, only really gives a benefit for HMRC and no real, tangible benefit for the small business owner.
When it comes to perusing small businesses and issuing wind up orders, HMRC have never filed as many as they did in 2016 – a total of 3,906 in the calendar year of 2016. Should your business receive a winding up order, the business will be forced to close and will have its assets liquidated to pay outstanding tax bills. The increase was somewhat expected by accountants across North Wales and beyond – following a vast amount of sustained pressure from all around for the HMRC to pursue and clamp down upon those perceived to not be paying their way.
The importance of getting it right first time has never been so high. For a small business in particular, it’s absolutely vital, as unlike gigantic companies, your average “ma and pop” high street independent business can struggle to meet cash flow issues, and find that traditional loans and overdrafts are closed to them because of their status. Without this cushion, a small business can often become unstuck very quickly, even if it is going through a period of relative security.
The assistance of a chartered accountant in North Wales can help smaller businesses approach banks and other lenders with services such as due diligence and bank negotiations, and can often be the factor that allows a bank or other lending provider to assist with cash flow challenges around major tax deadlines and due dates for VAT, or corporation tax bills.
It’s absolutely vital that a small business doesn’t stick its head in the sand when it comes to paying tax.
A good accountant is there to get it right, and there to help a small business allocate funds in order to do so, but any business experiencing difficulty should work with the HMRC to prevent arrears from becoming far too much to bear.
Furthermore, proactive steps are needed to make sure that funding is available when needed, so don’t neglect your dues!