MP blasts HMRC over interest rate swaps

HMRC's attitude toward business mis-sold interest rate swap products is "disappointing" according to MP Guto Bebb. 

While banks have taken a more relaxed view toward affected businesses, Bebb, chairman of the All Party Group on Interest Rate Mis-selling which 50 MPs have now joined, said HMRC have been "less than sympathetic". 

In a letter to Mike Eland, director general of enforcement and compliance at HMRC, Bebb expressed MPs concerns about  HMRC's attitude. 

"These products have resulted in significant financial consequences for the businesses in question," he said. "Actions taken by HMRC actually threaten the ability of individual businesses to survive. It is very concerning to see that HRMC appears intent on pushing businesses that might well be eligible for redress into administration." 

An HMRC spokesman responded: “HMRC offers a range of support to businesses in temporary financial difficulties, to help them manage their cashflow problems. Where businesses are facing genuine short term cash flow difficulties for whatever reason it is important they approach us as soon as they realise, so that we can consider early on whether time to pay is appropriate.”

In response to this, the FSA set up a redress scheme for businesses, which is almost finished its pilot review process. 

Eleven high street banks are involved with the scheme, including HSBC and Barclays, who have suspended swap payments for businesses seen as particularly vulnerable. Bebb said the redress scheme is expected to be rolled out in the New Year. 

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Comments

Unfair to blame HMRC for this    4 thanks

Oppco | | Permalink

Unfair to blame HMRC for this one, surely. Presumably they are only trying to collect what is owed in tax. Is that not what HMRC are for?

The government should look to the light touch regulation they initiated, allowing all these mis- selling schemes to flourish.

Since when were banks 'trusted advisers'?  Not in my working lifetime

 

Who is advising the "victims?"    1 thanks

andrewwatling | | Permalink

All well and good to blame HMRC for this, but they are just doing their job, which is to try to collect taxes

In my experience, when provided with proper evidence that a debtor is addressing a particular issue that is causing issues for the business as a whole, they will generally be supportive and listen to what is being said.  However, all too often business owners think that they can simply make a telephone call and their problems will all go away

HMRC can't therefore be blamed for appearing to ignore the long line of businesses that are using the excuse that they have been missold a swap or hedge to disguise other underlying issues within the business and in many cases, they will discover they are by far the largest, oldest creditor - they don't have the option to turn of the supply tap that other creditors do so their arsenal is limited to enforcing through execution and winding-up

And if the only reason the business is on the precipice is the delay in receiving recompense, HMRC and other creditors will surely consider a CVA proposal if the MP is so averse to the Administration route, as long as it is set out properly