Having been HMRC’s preferred method of payment for a while, it will soon be the only method to pay for a number of reasons. HMRC has stated the move will be more cost and time effective, ensuring a smoother process of payment. It will prevent customers paying late or missing payments and will avoid any wrong allocations. Direct Debit also provides a guarantee to customers, which protects and monitors security of payments. If errors are made, the guarantee can ensure you receive a full and immediate refund.
Existing customers who do not pay with direct debit can continue to pay HMRC with their previously agreed method and do not need to switch. New customers will need to have their bank details available to HMRC when arranging the TTP. It is also likely that if a company has to start a new TTP if the old one failed then they will be forced to pay by direct debit.
If your clients are falling behind with VAT or PAYE, it’s worth considering an informal Time to Pay deal with HMRC. We can talk to HMRC on your behalf to set up an affordable and realistic payment plan.
He is managing director of Company Rescue Ltd and KSA Group Ltd - a specialist firm of turnaround practitioners. Keith has been featured in Mike Southon's column in the Financial Times and his book - This is How Yoodoo on entrepreneurs.
More than 5,000 people have contacted KSA Group since Keith launched this...