Corporation Tax Refunds Rise

According to top twenty accountancy firm, UHY Hacker Young, the amount of corporation tax refunds issued by HMRC has doubled over five years from £4.7 billion to £9 billion, representing a hike of 91% in the five years to 31st March 2010.

In the year to 31st March 2010, the average repayment claim rose from £17,683 in the previous year to £25,259, representing an increase of 43%.

The rise in tax refunds is due to companies sustaining and accumulating losses during the recession and then claiming tax relief for those losses against earlier years profits.

UHY attest that a typical repayment claim takes two to three months to process but in extreme cases can take two years, causing huge problems for businesses requiring much needed cash input.