Mark Snee, managing director, Technoprint
On the face of it, yes, the new rules will ensure that potentially insolvent companies are dealt with earlier. Recent figures reported that 200,000 businesses had been helped with £5.2bn of debt to HMRC since November 2008 when the scheme started. Many financiers always believed that a substantial percentage of that would never be collected as much of it was in companies that were effectively insolvent. It sounds as though HMRC has come round to the same view – hardly surprising when it has been stung for £5m from a single print company. If earlier intervention saves other creditors, then it’s the right thing to do.
Tony Pond, managing director, First Choice Business Systems
I think at present the scheme is too easy for companies to register for and an Independent Business Review (IBR) will help in the sense that it will give a better understanding of a business’s cashflow and orders. I believe the scheme can greatly help companies that have short-term cashflow problems, but where the future pipeline of the business looks healthy, and I think an IBR will help to establish if this is the case. A company with long-term problems is likely to become insolvent anyway.
John Gilmore, managing director, Autobond
I don’t think so. When a company is in trouble it will say anything it can to anyone to keep trading – including to the HMRC. It may be that they simply don’t tell HMRC they need more time. Very few companies actually stick their hands in the air and admit that they have a problem. In those kinds of situations they aren’t thinking about suppliers they are thinking about themselves, it is human nature. Whenever people get to a certain stage they aren’t planning anything too far ahead, they become horrendous liars. Nothing that the government do will change that.
Steven Brown, managing director, Your Print Solution
Why is HMRC allowed to gamble with this kind of money? It goes against everything I believe. We don’t factor our invoices and we won’t defer our tax liabilities. It’s a slippery slope; once you start deferring tax, there’s nothing left after that. We are a small company; last year we lost nearly £20,000 and when we look at the creditor’s listings, HMRC are always owed a lot of money. Tighten up the rules, make companies responsible, make individuals responsible and stop losing all of this money. On a controversial note, when a phoenix company starts up, slap them with the tax bill for the collapsed firm’s debts.
