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Businesses still deferring tax payments

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A scheme designed to provide firms facing short-term financial problems with more time to pay their tax bills is still attracting applications.

The latest figures from HM Revenue and Customs (HMRC) revealed that, as of 20 December 2009, some 249,000 businesses had come to agreements under the Business Payment Support Service.

The scheme, which allows firms struggling with cashflow to negotiate an extended timetable for settling PAYE, corporation and income tax bills, was extended by the Chancellor in his pre-Budget Report.

The total amount of deferred tax has now reached £4.37 billion of which £3.33 billion has been repaid.

The majority of rescheduled payment agreements (60 per cent) are for three months or less.