Firms hit by refund delays

Thousands of small businesses are suffering financially due to chronic delays in issuing tax refunds.

Delays in handing out refunds — valuable cashflow for many struggling firms — are so bad that HM Revenue and Customs (HMRC) has been forced to publish an apology to accountants and their clients as part of its regular guidance.

HMRC insists the delays are down to more rigorous security checks, which has resulted in many more self-assessment refund claims being sent for review to a specialist team that has been set up in Bristol.

These claims have been rubbished by the Institute of Certified Practising Accountants, the membership body representing general practice accountants in the UK.

Chairman Tony Margaritelli said: “Refunds are taking an interminable amount of time. Many accountants are pretty unimpressed by the excuses — the general consensus is that the Government wants to hang on to the money as long as possible and has asked HMRC to drag its feet.

“What is most galling is that HMRC has been encouraging accountants to file self-assessment for clients because refunds are automated and should come through within days.

“Last year the system worked smoothly, but this year payments are months overdue.”


Manufacturing gets a boost

Recovering car production pushed the manufacturing sector to its strongest growth in more than three years during July, official figures showed today.

Output grew by 0.9 per cent over the month — well ahead of forecasts and the best performance since May, 2006 — the Office for National Statistics (ONS) said.

Car manufacturing grew by 10.4 per cent during the month as experts seized on the latest signs that the ailing UK economy is emerging from recession.

Howard Archer, of IHS Global Insight, said the figures were a “really nice positive surprise”.

Car manufacturing has been boosted by initiatives such as the scrappage scheme as well as factories restarting production after shutdowns at the height of the recession.

The second successive month of growth overall was helped by a strong performance from the chemicals, rubber and plastics industries — although the electrical, printing and publishing sectors were stuck in the doldrums.

Manufacturers have been helped by the huge stimulus to the economy given by record low interest rates of 0.5 per cent as well as efforts to boost the money supply.


Free advice on debts

A FREE debt advisory service to help businesses hit by the downturn has been launched by Greater Manchester Chamber.

Available to all businesses with fewer than 250 employees, the service is aimed specifically at viable businesses that are beginning to experience financial issues as a result of the recession.

Andy Nichols, who is running the service with Dave Martin, said: “The key objectives are to prevent businesses closing and secure jobs.

“Our early involvement is crucial, as this will maximise the number of options that are available and increase the chances of a successful outcome.”

Businesses using the service will be given a confidential review, which will look at issues such as income, cash flow and creditors.

An action plan will then be agreed with the client.

The debt advisory service, provided by Business Support Solutions, is funded by the Northwest Development Agency.

For more information call 0845-608 3388.