January and July are common times when many of your business bills are due and in particular personal tax, we have seen a marked increase in HMRC enquiries and the taxman is certainly more active in the recovery of outstanding Taxes owed to the HMRC.
Recently, the HMRC have come under fire for asking tens and thousands of self-employed workers to consider mortgaging their homes or take out loans, to settle huge outstanding tax bills.
These letters, which were sent out by HMRC said: “It is expected that you use every means to meet your obligations and pay the tax and interest liabilities that are due. This may include raising a loan or selling other assets.”
So, the question is, are you doing the right thing by borrowing money to pay HMRC and other creditors?
It is a familiar feeling for many business owners, discovering a tax bill is due and realising you don’t have enough working capital set aside to pay for it. Lack of working capital is a good reason to borrow money, but only if it can help you grow your business.
Many online/alternative finance providers are lending money, but most of these will require company directors to provide ‘Personal Guarantees’, which means that if things go wrong in your business, you will personally be liable for any outstanding debts to these lenders!
Before borrowing money to repay HMRC and/or other creditors, you can discuss it with us. We can talk to HMRC and will almost always get a better, affordable, payment plan than you would be able to negotiate on your own.
So don’t hesitate in contacting us today for a free no obligation meeting, should you find yourself in this situation.