It seems that despite offering to have 2,000 experienced call handlers on the HMRC Time to Pay help line, the system has fallen at the first hurdle with staff shortages, reduced hours and long waiting times.
I should act surprised but I’ve been an accountant for too long and have seen too many HMRC failures.
So in my usual chin(s) up, we won’t be defeated style here’s my advice.
At this time any and all business owners and the self employed need to be all over their cash flow.
What’s coming in and what’s going out.
Do this for both your business and your personal finances making ruthless cuts to costs and outgoings where you can.
This is a crisis. You will have to make sacrifices.
Do the cash flow by month (incomings and outgoings) for the next 6 months at least showing each month separately.
Add in any payments that you know you have to make such as taxes due.
If you do have any, add your “rainy day” money and savings into your personal cashflow. If you’re self employed then add in your Tax Pot into your cash flow; you should have one!
What’s the result
So what do your business and personal cash flows look like?
It might be gloomy or perhaps, with ruthless cost cutting, not as bad as you thought.
Whatever it is, having it written down makes it easier to manage.
If the result needs some work i.e. it’s showing negative cash flow all the way through, then you need to act.
Start with the two things that we do know about.
If you have taxes due that you can’t pay then work out what you will be able to pay and when. Start making those payments. I should be advising you to call the HMRC “Help To Pay” helpline to make an arrangement but HMRC are on their knees.
So I’m advising that if you make a time to pay plan you should document this in a letter telling HMRC what you intend to pay and when. Send the letter to them using a signed for post option so that you have proof of delivery.
Tell them in the letter that you would have arranged a plan with them but know that they were having problems answering their special helpline and, given that you’ve made sensible efforts to pay the taxes you expect them to waive any penalties and fines.
If they do come back at a later time and there are any issues then contact us and we will try to help.
If you’ve a mortgage then take advantage of the three month payment holiday on your loan.
Contact other lenders that you may be using to see if you can secure payment holidays.
If you rent then there have been assurances that no one can be evicted for three months. So there’s no need to panic.
Help provided by the bank
The Times has summarised what the banks are doing to help during this crisis. CLICK HERE to read the article.
Whilst appreciating that things are hard there are work opportunities out there not least a plethora of temporary jobs. Of course these may not be in your chosen field. However don’t dismiss any income generating opportunity that helps to make your cash flow more positive.
If your self-employed, never has there been a time to be creative and inventive with your offering. There are some fabulous examples out there of businesses hit by the crisis who are doing things differently to keep income coming in. It’s worth a shot. Keep any outlays low and see what happens.
The Government should help
Yes the Government should help and I’m sure they will. We’ve got to be a little patient and give them a bit of time to get financial help plans in place with the appropriate process and procedures so that scammers can’t take advantage. Things take time and we are only a week in, at the time of writing this. I hope I’m not in the minority when I say I’ve been impressed with progress so far. Whilst many may be frustrated I do think a little bit of realism needs to be injected into expectations.
Keep calm and carry on
That old slogan is really coming into its own now. There is not one person who is untouched by this. The heightened level of panic and anxiety will pass. Worry about the things that you can change. The rest can and will resolve itself.