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Budget 09: Government extends credit insurance

Simon Quicke

The chancellor has delivered the credit lifeline that the industry has been calling for as part of numerous moves made to try and help companies weather the recession.

Alistair Darling said the government had recognised the impact on companies as a result of the reduction in the amount of credit insurance available.

He said it would top up its credit insurance scheme to cover the reductions that have been made by insurers.

In addition he said it would make it easier for companies that are on the brink to claim back taxes on profits made in the last three years, which could help keep them trading.

"Many viable companies face temporary difficulties because of a shortage of credit," said Darling, "so today I am extending the help which allows loss-making companies to reclaim taxes on profits made in the last three years.

"This help, which will lead on overage to repayments worth £4000 each year, will now be available for two years until November 2010," he added.

"Well over 100,000 businesses will have full current losses entirely wiped out," he added

He added that 800,000 small companies would benefit from the delay in the corporations tax payments.

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