Thousands of businesses struggling to cope with the credit crunch and general economic turmoil face a midsummer nightmare this week as key payment dates loom.

A triple whammy of rent, bank interest and VAT bills could sink weaker companies, particularly retailers.
'There are three sucker punches coming towards struggling businesses this quarter-end,' said Peter Sargent, vice-president of the insolvency practitioners' professional body R3.

Tuesday is one of the four 'quarter days' on which commercial rents fall due, and one week tomorrow, quarterly bank interest payments are due from businesses.

In many cases, firms will be working out quarterly VAT payments on the same day - and whether they can afford them.

'I know of certain cases where people are going to see their landlords this week and next week to get terms for extended payment,' said Keith Goodman of insolvency practitioner Leonard Curtis. 'This is going to be a difficult midsummer for some.'

Sargent said: 'If a firm has had a bad quarter - if it is in the retail or leisure sectors, for example - this could be the moment of truth.'

Despite buoyant figures last week for retail sales in May, major uncertainty hangs over retailers. Furniture group Land of Leather is raising fresh capital and rival ScS hopes to do the same.

The British Retail Consortium's next monthly sales monitor, due on July 15, may give a clearer indication of conditions on the High Street. 'We advise members to stay in with their bank manager and landlord,' said Stephen Alambritis, head of public affairs at the Federation of Small Businesses.

'Most landlords would be aware of the economic situation and be fairly understanding. But some could be looking for an opportunity to foreclose and sell the property.'

Company liquidations are rising in England and Wales. They stood at 3,210 in the first quarter of this year, a 4% increase on the first quarter of 2007.

Tuesday's midsummer quarter rent day and the quarterly bank interest due on June 30 affect all businesses, while quarterly VAT payments are due depending on when the firm registered for VAT. Firms then have 31 days to pay.


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