HMRC’s business support service overwhelmed by queries

HMRC’s Business Payment Support Service (BPSS) has reportedly been “overwhelmed” by enquiries from businesses and self-employed individuals impacted by the coronavirus outbreak, according to UHY Hacker Young. 

The accountancy firm claimed there was “little evidence” that extra resources have helped the BPSS, despite the chancellor promising that 2,000 extra staff would be made available to it in his budget. 

According to UHY Hacker Young, those calling the BPSS have been kept on hold for up to 60 minutes, while others have been transferred to the wrong HMRC team. 

The firm said the BPSS is “crucial” businesses facing “significant reductions” in earnings due to the coronavirus pandemic.

If businesses are not able to defer tax payments such as VAT, they could face being wound up by HMRC or spending cash reserves to pay tax bills instead of wages or suppliers.

The firm said that businesses in the hospitality, travel and retail sectors are “likely to become very reliant on the BPSS”, as they are being “hit hard” amid government calls for social distancing. 

John Sheehan, partner at UHY Hacker Young, said: “Businesses are in urgent need of support, with many potentially teetering on the brink of insolvency due to Coronavirus. 

“The Government has done the right thing in making the BPSS central to dealing with this. But we have to get the logistics right.” 

He added: “The BPSS will not have seen this volume of calls since the financial crisis of 2008 and demand for deferring tax may be higher. 

“Rushing sufficient resources to BPSS and extending Time to Pay Arrangements will buy extra time.”