Business rates are crippling UK businesses. The government expects to rake in almost £27bn in taxes from British-based businesses this year, more than council tax and fuel duty. The pressure imposed on small businesses is crushing local markets and paving the way for multi-million pound international brands to pick up the pieces.
The Treasury’s tax is nothing more than the growing burden of property tax British businesses are forced to pay. In the next two years, there will be tax increases of 11 per cent, making it the government´s fifth biggest levy after, National Insurance, income tax, VAT, and corporation tax.
The hardship however is that the tax rates are based on property values before the Lehman Brothers scandal collapsed the housing market. In many cases, the annual inflation increase will be more than the company´s financial performance and eats into the budget stunting business growth.
The impact business rates have a small local businesses severely contributes to the destruction of local industry. With the increase in rent and utility bills many UK firms are struggling to stay open, especially in retail. Meanwhile, the government is funding plans to build enterprise zones to attract international restaurant and clothes chains.
Saving money on taxes
Despite imposing taxes on small businesses the government does allow some breaks. UK businesses are entitled to tax relief on numerous areas of the business depending on your type of business and the amount of profits you receive in revenue. To discover the tax breaks you are entitled to it is advised to contact a qualified chartered accountant.
An accountant will also assist you in filing your Self Assessment Tax Return Form, which could prove to be a blessing in disguise. In 2012, HMRC introduced a rule that if you file your tax return after the deadline (31st October by post, 31 January online) or make an error on your tax form you will incur a fine of £100.
The pressure that tax forms put on the tax payer can be intimidating and confusing, easily causing you to misunderstand the requirements and subsequently give a false answer. The form is purposefully designed to catch out fraudulent claimants, but innocent bystanders unassumingly get trapped in the net.
It is a common misconception among small business owners, especially young start-ups, that accountants are costly and an unnecessary expense. However, having an in-depth knowledge of the tax rules can make you substantial savings and ensure you do not pay more taxes than you have to.
Some chartered accountants also offer business planning services that includes drafting a business plan, registering your company and developing a financial and accounting plan. Taxaccolega also offer our clients an easy-to-use accountancy system to keep your financial affairs in order.
If you are be crippled by business taxes and need to save money in any area of your business, give one of our friendly and knowledgeable experts a call on 08000 235 234 or email email@example.com. We specialise in the tax and accounting for small business, sole traders, entrepreneurs and charities.