SMEs urge government to simplify UK business rates system

SMEs urge government to simplify UK business rates system

A report published by banking group Close Brothers has revealed that 71% of UK small and medium-sized enterprises (SMEs) would like the UK’s business rates system to be made ‘simpler and more flexible’.

The report also suggested that 49% of SMEs believe that the government is ‘not doing enough’ to help businesses with business rates relief. Just 36% believe that they receive adequate support from the government in regard to their business rates.

Image result for UK business rates system

In addition, Close Brothers revealed that 56% of UK small firms have experienced increases in their business rates over the past two years. London, South West England, Yorkshire and Scotland in particular have been adversely affected by rate rises ‘above the UK average’, the report suggested.

Commenting on the matter, Neil Davies, CEO of Close Brothers, stated: ‘Steps are being taken, as demonstrated by an initiative that’s been in place from 1 April 2017 that saw 100% relief, doubled from the usual rate of 50%, for properties with a rateable value of £12,000 or less.

‘That said, the message from SMEs is clear that more needs to be done.’

In the 2017 Autumn Budget, Chancellor Philip Hammond announced that future business rates revaluations will occur more frequently. Revaluations will now take place every three years rather than every five years, beginning after the next revaluation, which is currently due in 2021.

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UK businesses ‘targeting international trade’ as part of growth plans, survey suggests

A survey carried out by distribution group CitySprint has suggested that UK firms are considering trading internationally in order to grow and expand their business.

The survey, which polled over 1,000 business owners and directors, revealed that around 1.3 million small and medium-sized enterprises (SMEs) are focusing on international trade in their plans to expand their business.

78% of those seeking to trade overseas indicated that they would like to do business in Europe, CitySprint found.

A further 55% are considering trading in North America, whilst an additional 36% expressed an interest in trading in Asia.

Businesses in the retail, manufacturing, arts, IT and utilities industries are most likely to consider trading internationally, CitySprint suggested.

Meanwhile, the survey also revealed that 52% of firms have plans to expand their business within the UK.

Commenting on the findings, Patrick Gallagher, Group CEO at CitySprint, said: ‘The UK’s smaller enterprises show no shortage of ambition when it comes to exploring new markets.

‘Whether it’s going global or taking trade nationwide for the first time, scaling up is a huge milestone in any organisation’s history. It needs to be done thoughtfully and with care – but it doesn’t have to be done in isolation. SMEs must work together to realise their goals.’

Survey suggests many SMEs ‘opting to self-fund’

Survey suggests many SMEs ‘opting to self-fund’

A survey carried out by market research group BDRC has suggested that many UK small and medium-sized enterprises (SMEs) are choosing to fund their expansion and growth plans using their own finances.

The survey, which quizzed over 130,000 SMEs, revealed that UK businesses are ‘more likely to be self-reliant’ when it comes to sourcing finance for their expansion plans, with many self-funding via retained profits, trade credit and credit balances.

Of those firms who did seek to secure a loan during 2017, 41% were confident that a bank would lend to them, the survey revealed.

Some 38% of SMEs made use of external finance last year, with 31% using ‘core finance’, including loans, overdrafts and credit cards.

Commenting on the findings, Stephen Pegge, Director of Commercial Finance at UK Finance, said: ‘It is encouraging that increasing numbers of small firms are looking to use finance to grow their business in the year ahead.

‘However, most SMEs are still self-funding, with the vast majority not seeking any new external finance in the past year.’

‘Immediate action’ required to stop business rates increases, BCC warns government

‘Immediate action’ required to stop business rates increases, BCC warns government

In its Autumn Budget submission, the British Chambers of Commerce (BCC) has warned the Chancellor that ‘immediate action’ is required to ensure that UK businesses aren’t hit with further business rates increases.

Image result for british chambers of commerce brexitThe BCC has urged the government to abandon the annual uprating of business rates for the next two years. It also called for the government to exclude plant and machinery from business rates valuations.

Echoing the call made by the Institute of Directors (IoD), the BCC urged the government to temporarily increase the Annual Investment Allowance (AIA) from its current rate of £200,000 per annum to £1 million, in order to ‘incentivise business investment during the Brexit process’.

In addition, the business group called for the government to refrain from imposing ‘more input taxes or other significant costs’ on firms, and urged the Chancellor to commit to ensuring adequate mobile coverage across the UK by 2020.

Commenting on the wishlist, Dr Adam Marshall, Director General of the BCC, said: ‘At a critical moment for the UK economy, the Chancellor must be bold – and deliver a big Budget that prioritises economic confidence and investment.

‘The best possible Brexit deal won’t be worth the paper it’s written on if conditions for growth aren’t right here at home. The Chancellor has a unique chance to move the dial on growth and productivity now, leaving the UK in a position to succeed over the long-term.

‘Action to slash the upfront costs faced by business, to incentivise investment and to improve mobile coverage and infrastructure would lead to a real boost to productivity, wages and trade.’

The Chancellor will deliver the Autumn Budget on Wednesday 22 November. Make sure you keep an eye on our website for coverage of the key announcements.

Brexit ‘could increase number of business insolvencies’, ICAEW suggests

Brexit ‘could increase number of business insolvencies’, ICAEW suggests

A survey carried out by the Institute of Chartered Accountants in England and Wales (ICAEW) has suggested that the number of businesses declaring insolvency could potentially rise as a result of the impact of Brexit on the UK economy.

Image result for insolvencyThe survey revealed that 73% of individuals working in the insolvency and business restructuring industry believe that Brexit poses the ‘biggest threat’ to businesses over the coming years. Meanwhile, 56% of those surveyed also believe that a rise in interest rates presents a risk to UK businesses.

The survey suggested that the retail sector could be the worst affected by insolvency, with 77% of respondents believing that it would be the sector most likely to experience ‘increased financial difficulty’.

Affected firms should seek early help in a bid to restructure their finances, business processes or management, the ICAEW stated.

Reflecting on the issue, Bob Pinder, Regional Director at the ICAEW, said: ‘We are in no doubt that businesses in the UK face difficult times ahead. A sharp and unexpected rise in the cost of doing business can make managing liquidity tough.

‘We believe that a change in attitudes is critical in order to successfully avoid substantially increased corporate insolvencies – confronting business issues, rather than being ashamed of them.’

Significant number of UK workers ‘considering setting up a side business’

Significant number of UK workers ‘considering setting up a side business’

Research carried out by domain registrar GoDaddy has suggested that a significant number of UK workers are considering setting up a business in addition to working their usual day job.

Nearly a fifth of those surveyed have contemplated starting up a business on the side, GoDaddy revealed.

The survey found that ‘side businesses’ help individuals to top up their income, with some entrepreneurs reportedly earning between £500 and £5,000 on top of the salary from their day job.

48% of those who start up a side business do so to make money from a passion or a hobby, the research revealed.

However, some experts have warned that many have set up side businesses in order to make ends meet. Annie Quick, Subject Lead in Inequality and Wellbeing at think tank the New Economics Foundation, commented: ‘For many more people, this is something they’re being forced to do.

‘We’ve had a decade now of stagnating wages, benefit cuts and increasing prices, so many people are finding that a full-time job is no longer enough to put food on the table and are often having to turn to often poorly paid, insecure employment to top up their income.’