Good and bad news for small business
Trawling through the small business news, two items in particular caught this writer’s eye. And in the best traditions of news reporting although the two items aren’t directly related there is some good news and some not so good.
Starting with the good news, HM Treasury have announced that they are delaying the introduction of the Making Tax Digital initiative for smaller businesses. Quarterly tax reporting was originally due to start from April 2018 for all businesses although the most recent budget delayed reporting for businesses under the VAT threshold for twelve months.
Now it seems as though a combination of the snap general election, delays in developing effective software, and representations from accountants and business alike has resulted in HM Treasury pushing back the introduction of the initiative. Businesses over the VAT threshold will now be looking at a commencement date of April 2019, and then only for VAT purposes with quarterly reporting for other taxes not been required until at least April 2020. Quarterly reporting for businesses which fall below the VAT threshold will not come in until at least April 2020, and then only on a voluntary basis.
The change in timetable has been hailed as a benefit for small businesses, saving them from having to source and transfer to new accounting systems and from the administrative burden of preparing quarterly returns. And administration time is certainly something which small businesses need, particularly when it comes to chasing debts and managing cash flow.
A survey by BACS has revealed that late payments continue to be a problem for SMEs. Although the size of the problem has halved over the last five years, SMEs are still owed a total of £14 billion with a third of SMEs commenting that payments are received more than a month late. This has a knock-on effect with businesses relying on overdrafts, struggling to pay staff on time and even facing bankruptcy. Ironically, when late payments cause cash flow difficulties, 12% of SMEs find themselves having to employ someone specifically to chase overdue monies. As a result late payments are costing SMEs more than £2 billion every year.
It’s hardly surprising therefore that concession on making tax digital has been widely welcomed. Any measure which helps to reduce the burden for small businesses is good news. But there are also measures which businesses can take in order to reduce their own day-to-day burdens. Take something simple such as managing the telephone system for example. Thanks to technology, telephone systems are far more flexible than they were in the past; bringing businesses the ability to design systems which work for them rather than the other way around.
For example virtual switchboards enable businesses to manage calls and call transfers as they wish, being programmed and reprogrammed in response to changing business patterns. And when your staff may be working flexibly from the office, from home or from any other location, the ability to direct and redirect calls seamlessly not only reduces administration time, it helps your business to stay in touch with your customers.
Add in other features such as answerphone, information lines and a range of national and international phone numbers chosen to meet your customers needs and even the smallest of businesses can present a professional and cost-effective telephony face to the world.