R3 Conference: HMRC Time to Pay Scheme

challenges facing the legal sector

Our Director, David Johnstone, attended the R3 Annual Conference 2022. A number of industry leaders spoke at the event, members of the Judiciary and a number of representatives from HMRC. On day two of the event, HMRC spoke about their evolving approach to the restructuring and insolvency sector.

One of the topics discussed by HMRC was their approach to their Time to Pay scheme. Although this scheme is still being offered by HMRC, they highlighted the fact that they would be becoming more consistent in requiring payments as and when they are due.

What is the HMRC Time to Pay scheme?

If businesses are unable to pay their tax bill in full, HMRC usually allow them to pay in instalments, this is known as a Time to Pay arrangement.

During the R3 Annual Conference, HMRC highlighted the fact that, although they have provided this scheme to many businesses, they are facing issues with the arrangements being breached, and are therefore seeking to take a more consistent and potentially more aggressive approach where payment plans are not adhered to.

 

What can Recovery First do to help?

If you are working on behalf of a law firm that is struggling financially, they may have considered utilising the HMRC Time to Pay scheme to help spread their financial burdens. Recovery First can assist law firms (and professional advisers working with law firms) who are either considering requesting a Time to Pay arrangement from HMRC, or those who have a Time to Pay arrangement in place.

  • Before a Time to Pay arrangement has been put in place, Recovery First can assist with the restructuring of the law firm to help them realise value locked in their WIP. This may release the cash they require to pay the tax bill.
  • If a firm has a Time to Pay arrangement in place, and are struggling to keep up with payments, Recovery First can advise and assist on the best route to take in order to restructure the business and release payment from their work in progress to help them meet their repayments.
  • If a firm has breached their Time to Pay arrangement, it is likely that they are suffering from severe financial issues and need a way out. The Recovery First scheme can help the law firm by offering the best options available to help them restructure and exit an unprofitable market, whilst assisting cashflow by releasing the WIP built up in their client files.

How does the Recovery First scheme work?

Recovery First provides a solution for insolvency practitioners, accountants, restructuring and corporate recovery specialists helping law firms to withdraw from the market – even in very distressed situations where SRA intervention is a real and present threat.

As each project is unique; the flexibility of our model allows us to create a bespoke solution to ensure the best outcomes are achieved utilising the specialist expertise of a combination of our panel law firms to ensure maximum value is recovered for the WIP assets.

Due to the fact that our model aligns all parties’ interests at conclusion of cases, there is no need for any lengthy due diligence so we are able to act very quickly.

Our service provides a methodology which:

  • Is SRA compliant and ensures clients are protected
  • Provides compliant formal commercial contracts between all parties
  • Manages the transfer process of live matters from original firm to our panel firms
  • Provides financial management of the costs recovery process, including the allocation and distribution of funds
  • Give you access to a dedicated, experienced management team to oversee the process from investigation to conclusion

In addition, we can assist in the following areas:

  • Managing interaction with  existing funding and insurance arrangements
  • Provide Management Information monthly designed to reflect individual requirements
  • Financial reporting

 

Contact Recovery First today

If you are a solicitor, accountant, insolvency practitioner, or restructuring professional and would like to find out more about Recovery First’s process, feel free to get in touch today via email at david.johnstone@recoveryfirst.co.uk, or 07887796989, or contact Sally Dunscombe at sally.dunscombe@recoveryfirst.co.uk or 07774205870.

It's never too late to speak to Recovery First. Contact us now in the strictest confidence

Sally Dunscombe:

sally.dunscombe@recoveryfirst.co.uk

David Johnstone:

david.johnstone@recoveryfirst.co.uk

Telephone:

01357 440140

Manchester Address

106 Kennedy Building

Murray Street

Manchester

M4 6HS

Registered Address: 

North Torfoot

Drumclog

Strathaven

ML10 6QG