SMEs continually disappointed by HMRC

The services offered by HM Revenue & Customs (HMRC) are either ‘bad’ or ‘very bad’, according to a survey of Small and Medium-sized Enterprises (SMEs).

Earlier this week, a study carried out by Simply Business found that more than half of small business owners across Britain were ‘dissatisfied’ with HMRC’s services.

The news comes shortly after six consultation documents into HMRC’s ongoing systems overhaul, Making Tax Digital (MTD), revealed that small firms and self-employed taxpayers are soon to be burdened by increased tax reporting requirements – unless their income is less than a measly £10,000 a year.

Under new proposals, businesses and self-employed individuals will need to submit tax information to HMRC four times a year, according to consultations.

35 per cent of British SME owners told Simply Business that they thought HMRC’s offerings were ‘very bad’, while a further 21 per cent described the Revenue’s facilities as ‘bad’.

The cynicism follows controversial reports surrounding the tax authority’s poor telephone services, which are fast-diminishing in the wake of MTD.

In 2015, HMRC reportedly cost tax payers some £97 million by keeping business owners on hold when they ‘could have been attending to business’, the National Audit Office (NAO) reported.

The NAO adapted the Revenue’s own criteria to calculate the average value of each caller’s time spent on hold – which it said was approximately £17 per hour.

Calls to increase apprenticeship support and incentives for SMEs

A report published by the National Federation of Self Employed & Small Businesses (FSB) has suggested that, under increased Government support, UK businesses could deliver approximately 1 million more apprenticeships.

According to the FSB, approximately one in four Small and Medium-sized Enterprises (SMEs) in the UK currently employ apprentices – and a further one in four have their sights set on employing apprentices in the near future.

FSB chairman Mike Cherry said that the UK was facing a “make-or-break moment,” after a report suggested that, amongst Britain’s 4.7 million SMEs, there was potential to ‘double’ the number of apprenticeships on offer – should the Government successfully deliver increased support.

He said: “While many small firms are committed to apprenticeships, many more continue to be worried about the time and personal commitment required.

“Smaller businesses are taking on more apprentices than ever before. What’s more, a quarter of our members say they are considering employing an apprentice in the future.

“This presents a huge opportunity and is great news for vocational training, which has become an increasingly attractive option for young people put off by the rising cost and uncertain returns of a university degree.

“We need the Government to hit the right balance between incentives and support,” he said.

SMEs could save cash by better engaging with UK banking market, says study

Small and Medium-sized Enterprises (SMEs) are “not engaged enough in the banking market” and could be paying more than necessary for their account, according to a new report examining the current and future state of UK banking.

The report, published by the Competition and Markets Authority (CMA), found that UK SMEs wrongly believe that “remaining loyal to a bank will be beneficial, in particular in relation to future lending decisions”.

It said: “There is also a perception among SMEs that potential gains from switching are not high, and that there is limited differentiation between banks”.

However, contrary to common beliefs, the report pointed out that SMEs could be more likely to benefit financially from switching their bank account, based on their business needs.

“[Common] perceptions are not borne out by our business current account (BCA) pricing analysis, which found significant differences between the highest and lowest monthly costs of a BCA for almost all our customer profiles,” the CMA’s report read.

“Whilst our estimates should be interpreted carefully, our BCA pricing analysis suggests that, in Great Britain, SMEs could save around £80 per year on average by switching to the bank that was cheapest based on their transaction behaviour,” it added.

Intelligent spending, profitability and tax-efficiency are crucial to SME success. Businesses are advised to consult tax experts and business advisors for tailored advice, before making important decisions.