Policy and regulatory uncertainty a large problem for small business, says ACCA

A lack of certainty amongst small businesses around payment
practices, regulation and post-Brexit planning will have a knock-on
effect for the UK’s small businesses, says ACCA (the Association of
Chartered Certified Accountants).

Ben Baruch, Head of SME Policy at ACCA, said:

‘The UK’s 5.5 million small businesses will be one of our greatest
assets in maintaining a strong economy and growth prospects following
Brexit. It’s important that the government looks at the best way to
meet the needs of these businesses, allowing them to access finance,
invest, export and ultimately grow in the coming months and years.

‘Many small businesses rely on their accountant for business support
and advice, and our members are seeing a number of common issues
affecting the performance of the UK’s small business community.’

REGULATION, LAWS AND MAKING TAX DIGITAL

While the UK is generally viewed as a good place to do business, ACCA
notes that small businesses are feeling the burden of excessive, or
unclear, regulation.

‘Last week’s second-stage Finance Bill, for example, which was over
600 pages long, contained a number of retrospective tax measures which
businesses are required to adhere to from 1 April 2017, before they
have actually been enacted to law,’ added Baruch.

‘This has added to a general sense of confusion around current and
upcoming tax legislation, which has impacted the confidence and growth
ambitions of many smaller businesses.’

‘The initial proposals for implementation of HMRC’s Making Tax
Digital programme also proved problematic. While the objective to
digitise and modernise our tax administration is a worthy one, the
requirement for quarterly digital updates introduced in a relatively
short time period look more likely to drain the resources of small
businesses, rather than helping to improve efficiency and
productivity.

‘The subsequent delay to an incremental rollout is welcome, but we
must ensure that the process remains collaborative and responsive to
allay concerns and uncertainty.’

LATE PAYMENTS AND THE SMALL BUSINESS COMMISSIONER

Poor payment practice is a major problem for many small businesses.
About 30 per cent of payments in the UK are typically late, with 61
per cent of these coming from larger companies. When small businesses
don’t receive payments on time, they are forced to spend time chasing
debts rather than growing and investing in their business.

‘The appointment of a Small Business Commissioner next month may help
some businesses in resolving disputes and complaints over payment
matters, but in order to achieve this it’s essential that the process
of engaging with the Commissioner is made as simple as possible,’
concluded Baruch.

‘And if the following first few months prove successful, perhaps
there will be scope for the government to expand the remit of the
Commissioner in future. The development of a coherent approach to
business support under a single institution could bring much needed
benefits to small businesses and help stimulate wider productivity
gains across the UK economy.’

‘Small businesses are calling for more certainty, and it’s time for
the government to listen.’