why would bookmakers pay early?

Publicity.

And also that when you are considering an Ante Post Bet, you might remember that Paddy Power could well pay you out on a loser, so you might bet with them even if they are offering slightly worse odds.

Powder Puff's usual tactics are to go shorter on something than everyone else so he takes no money then when that something is looking good he "pays out" early on them. Often gets thousands of pounds of publicity for an early payout of 36 pence. HTH.

publicity is good and they've not taken much money on the selection anyway.

PP notably go shorter on Irish fancies all the time

Rugby is my game and I have had loads of bets on the HC outright throughout the season. 

Interestingly my outright book shows not a single bet on Leinster with PP at any stage, so they were never a decent price on them at the times I fancied them.......so therein helps to tell the story as to why PP feel happy to pay out early.

I read in the Sunday Times yesterday that (The Andrew Davidson with Betfred's Fred Done) he paid out early once to gain a tax benefit.

So if a bookie has profit of, say £100m this will be subject to tax at year end.  If they pay out on some losing bets then the £100m profit will be reduced and they will pay less tax in that year. 

Admittedly this action will they only really avoided paying some tax in the current year and will result in more tax in the next year, but companies would generally pay tax later than sooner.