David Jetuah, Accountancy Age, Friday 9 July 2010 at 16:06:00

Cases of firms coming cap in hand for help to meet their tax liabilities hasrocketed says leading finance provider Syscap


Syscap, a leading independent finance provider has reported a 442% surge inaccountancy firms agreeing loans to pay their tax bills.

The company, which is the appointed practice funding partner for ICAEW memberfirms, recorded the rise during the first six months of 2010 compared to thesame period in 2009.

Tax funding now accounts for 47% of all the deals Syscap secured for theaccountancy sector in that period. In the first six months of 2009 just 17% ofSyscap?s financing solutions for the sector were for tax funding.

Philip White, chief executive of Syscap said: "These firms are perfectlyviable and creditworthy, yet the demand we have witnessed so far this year fortax funding from accountancy firms is indicative of the ongoing cashflowproblems the profession is facing."

White added that firms were finding sources of tax funding or deferral, suchas HMRC?s Time to Pay scheme, were being scaled back.

"Many firms that have already received one payment deferral from HMRC arefinding that they are much less amenable the second time round.?

HMRC has maintained previously that the criteria for the scheme has notchanged.

The taxman added Time To Pay has always been an option to those experiencingtemporary financial difficulty, but only for those with "realistic proposals topay off their tax debts over a relatively short period."