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UK Offers Concessions To Riot-Hit Businesses

August 2011 - Tax & Private Client. Legal Developments by Hassans.

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In an effort to help those businesses affected by the recent riots, the UK's government and revenue agency have unveiled a series of support measures, including government funding of business rates and the negotiation of tax payment schedules.

The riots which began on August 6 caused widespread damage, with businesses now beginning to count the cost. Vince Cable, the Business Secretary, has announced that his department, together with local enterprise partnerships, local authorities and business organisations, is working to ensure affected businesses have access to practical advice, information and support to get back on their feet as quickly as possible.

As part of this effort, the government has launched a High Street Support Scheme, worth GBP20m (USD32.5m). The scheme will fund the proportion of hardship relief from business rates that would otherwise fall to local authorities, and offers assistance where needed for business clear-up, replacement of equipment, or costs of temporary accommodation. Seriously damaged business properties will be taken off valuation lists, removing any liability for council tax or business rates.

The government has also begun work with the British Bankers Association to secure access to finance and ensure that emergency enquiries from affected customers can be dealt with simply and quickly. Additional financial support will be available should it be required - for example, where necessary, short to medium term finance arrangements will be made for repairs and to replace stock, and repayment holidays will be offered, until insurance claims are settled.

HM Revenue and Customs (HMRC) has also announced its determination to do all it can to help. It has launched a Civil Disorder helpline, designed to provide comprehensive advice and deal sympathetically with problems. HMRC is prepared to agree payment schedules with those who are unable to pay their tax bills due to short-term financial difficulties. It will also discuss practical solutions where businesses and individuals cannot meet their other obligations to HMRC for instance, where their records have been lost or destroyed in the disturbances.

In addition, whenever possible, HMRC will review any penalties imposed and withhold additional surcharges that would normally be triggered by missed deadlines. Companies House will follow a similar system, and will agree extensions and ensure that companies do not incur the usual penalties which apply for late filings, where they are unable to file accounts or additional documents on time.

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