Tax returns - Small firms set to suffer again

Starting in 2018, many small businesses may be required to submit tax returns four times a year, as opposed to the single return currently required.

The idea behind it is to bring small businesses in line with the practices that large companies and corporations have to adhere to, but, as with so many initiatives from the Government, there has been little thought given to the problems that will be experienced by small businesses in complying with this.

Most small businesses are sole-traders and micro-entities without any internal accountancy capability in their companies. This means they have to contract out their financial needs to firms which charge for their services.

This will impose an enormous additional administrative cost on small businesses.

The last thing these businesses need is another blow to their competitiveness and profitability through heavy-handed legislation.

There is still time for the Government to change its mind about this, but my suspicion is that this is all part of a drive towards more automation of our tax system to cover up the cracks caused by budgets cuts to Her Majesty’s Revenue and Customs – and, as usual, it is normal people and small business owners who will suffer for.

Margot Parker

UKIP MEP for the East Midlands