By Ellise Nicholls
Last week Philip Hammond, the UK chancellor, delivered the Spring Budget, “not a nice Budget for SMEs” according to Tim Davies, UK head of tax at Mazars.
Davies said that although Hammond pledged to make the UK “the best place in the world to start and grow a business”, raising national insurance contributions and the reduction in the dividend tax free allowance will result in increased tax burden for entrepeneurs and the self-employed.
Following a per-Budget survey that identified the top priority for UK businesses as income tax reduction, Moore Stephens said the Budget’s tax changes were “not in line with the priorities of small business.”
Timothy Fussell, partner at Mazars said that “the tax changes announced in the Budget do not match what businesses wanted to see.”
The Institute of Chartered Accountants of Scotland (ICAS) have said that the Budget reflects a “mixed bag” for small businesses, however they backed the chancellor’s decision to delay the introduction of digital tax for businesses with a turnover below the VAT threshold.
“ICAS supports the overall objectives of Making Tax Digital, but has long been concerned with the unrealistic timescale for the project. This shows a chancellor who has listened,” said Anton Colella, chief executive of ICAS.
Director at R&D tax credit consultancy ForrestBrown and member of HMRC’s R&D consultative committee, Jenny Tragner, welcomes the move to drive awareness of R&D tax credit incentives, however said that any previous measures to drive awareness had “not been fit for purpose”.
Tragner went on to mention the inconsistencies in the chancellor’s message. “ The government’s message also seems to be contradictory. The Spring Budget appears to prioritise the needs of big business over those of SMEs and start-ups, yet the chancellor stated it is the government’s ambition for the UK to be the best place to start and grow a business,” she said.
Dafyydd Llewellyn, director at Concur, said that commitments in helping SME’s with business rates rises was “vital” due to small businesses making up the majority of the private sector.
The lack of news concernning the appointment of the Small Business Commissioner has stirred disappointment.
“I was disappointed however, not to get a further update on the appointment of the Small Business Commissioner,” said Llewellyn.
“We’ve heard this position will be filled later this year, but who are the government interviewing? It would also have been good to have been provided with further details on the powers they will have, particularly when it comes to tackling the late payment epidemic that is crippling millions of organisations – an issue that should have been addressed as a stand-alone item in this Budget,” he added. The budget has been met with great criticism.