22 Aug 2023
Research carried out by finance provider Premium Credit has revealed that over 550,000 small and medium-sized enterprises (SMEs) in the UK are struggling to pay their corporation tax and VAT bills.
Around 10% of SMEs are currently struggling to pay their tax bills, according to the research, with the average bill value exceeding £45,000. An additional 10% said they have tax bills of £100,000 or more.
A quarter of business leaders admitted they will struggle to pay one or more tax bills in the next five years. 54% of SMEs polled said their main issue lies with corporation tax, whilst 35% have problems with their VAT bill.
Commenting on the research, Jennie Hill, Chief Commercial Officer at Premium Credit, said: 'SME finances are inevitably under pressure from the cost-of-living crisis and that has an impact on their ability to meet tax obligations but paying tax bills is a long-standing issue for companies and is certain to remain so.
'Failing to pay bills on time will lead to fines from HMRC so any company which is struggling should consider spreading the cost for up to a year to pay bills on time and improve cash flow when it is needed.'