SME news in brief: taxes, HMRC, digital safety, finance, sharing economy

News in brief
News in brief

HMRC quarterly tax returns criticised

Independent HMRC oversight body, the Administrative Burdens Advisory Board (ABAB), has refused to support the Government’s plans to force small businesses to submit quarterly digital tax returns saying: “compulsory digital record keeping and quarterly online updates is not an approach we can endorse.”

The ABAB has used its annual report to underline “significant concerns” shared by the Federation of Small Businesses (FSB) that, “the proposals for quarterly updates will be more burdensome than they currently are with increased record keeping and compliance costs.”

FSB National Chairman Mike Cherry said: “The writing is on the wall as more and more small businesses are making clear their concerns about this poorly thought out plan. Forcing small firms to pay for expensive digital accounting software so they must submit extra tax returns is not going to help anyone. It will simply add to the cost of doing business in the UK. These proposals will also substantially increase administrative burdens – particularly for the smallest businesses.”

Fairer tax for farmers

Under new rules, initially announced in the 2015 Budget, farmers will be able to average their profits for Income Tax purposes from two years to five years.

The latest move will help farmers with fluctuating profits better manage risk and the impact of global volatility which has become an inherent feature of the agricultural industry.

Environment Secretary Elizabeth Truss said: “Food and farming is already a vital part of the UK economy, generating £100 billion and supporting one in eight jobs. Our ambition is to make the industry a world leader, turbo-charged by talent, skills and innovation so it can capitalise on the growing demand for, and excellent reputation of, British produce.”

Internet Matters’ Digital Safety Awards

The final countdown has begun for entries to Internet Matters’ Digital Safety Awards - a ceremony dedicated to child safety on the internet.

The awards, sponsored by EY, will celebrate the best and most innovative products, services and initiatives designed to encourage children to be protected in their digital worlds.

Companies from a wide variety of sectors - from corporations to start-ups and SMEs - have so far entered. Others have until April 15 to get their nominations in and entries can be made online.

Innovative Finance Isa welcomed by alternative finance industry

The Innovative Finance Isa (IF Isa) has now been introduced, with many P2P firms looking to offer this new product to small businesses once authorised by the FCA.

Funding Invoice CEO Aamar Aslam, an online invoice trading platform, believes that it is certainly a positive step for the alternative finance industry as it will provide SMEs with increased awareness of their options.

Aslam said: “For small business owners looking to borrow money using an IF Isa, it will most certainly help to boost their finances. This new product is not only likely to make P2P finance more affordable, but will also allow a greater pool of potential investment in these alternative platforms, which will result in more investment for more small businesses.”

SMEs can’t ignore the sharing economy

The sharing economy refers to digital platforms which enable businesses to share property, resources, time and skills. The sharing economy in the UK is estimated to be worth around £0.5bn in 2014 and is a growing market, expected to be worth around £9bn by 2015, according to the latest figures from the Office for National Statistics.

Provider of accounting software for SMEs and entrepreneurs Intuit QuickBooks Europe VP and MD Rich Preece warns businesses against ignoring the sharing economy’s impact on the British economy.

Preece said: “Through providing a clear definition of the sector we can start measuring its growth, not only to quantify the tremendous opportunities that it brings to the UK economy and its workers, but also to create a better environment for those working within it. Formalising it as an industry will allow the creation of an improved infrastructure for people ‘sharing services’ since many things like taxes, retirement and insurance are based on a more traditional employment model. This will encourage more workers to get involved, boosting the industry and helping the growing ranks of sharing economy ‘entrepreneurs’ flourish.”