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Firms being forced to wait for tax repayments

By December 12, 2014June 13th, 2017No Comments

According to a leading accountancy firm, struggling businesses have to wait almost twice as long as they should for repayments of corporation tax from HM Revenue and Customs.

It was reported that many of the firm’s clients are now waiting longer than a month for repayments with some even waiting two months or more.

At the beginning of 2009 businesses had to wait just seven to fourteen days.

According to UHY Hacker Young, the recession has resulted in an increasing number of businesses making losses and such businesses are permitted to offset the losses against previous years and therefore claim back corporation tax previously paid.

In this year’s Budget, the Government announced that any business that reported a loss would be entitled to claim up to an extra £50,000 of tax relied in earlier years to help ease financial stress during the recession.

This however, is merely a temporary measure.

A spokesman at UHY Hacker Young said:-

“The last thing businesses need is delays waiting for corporation tax refunds – refunds to which they are fully entitled.

The financial distress caused by such delays will only add to the woes of companies already facing a struggle for survival.

Unlike the self-assessment system for individuals where repayments are largely automated, subject to security checks, all corporation tax repayments have to be processed manually by HMRC staff.”