Loans taken out by small businesses will be offered from one week to a year, with repayments on a weekly basis. According to research carried out in November 2011 by the Federation of Small Businesses, 57 percent of companies were paid late by clients. The number of successful business loan applications between 2007 – 2010 fell by almost a quarter. Over half the amount of small businesses which applied for an overdraft were refused in 2011, while 43 percent of companies applying for the first time for a business loan were rejected.

Chuka Umunna, the shadow business secretary, was critical of the government as it hadn’t secured more lending from banks to SMEs. He said:

“That SMEs are being driven into the hands of Wonga is a damning indictment of the government’s failure to get finance to successful SMEs.”

The founder and chief executive of Wonga, Errol Damelin said:

“Young, entrepreneurial companies represent our best hope of a recovery, yet many are struggling because they can’t get quick access to the credit that they need to cope with everyday challenges, such as late payment by partners or customers.”

Thorough financial planning with a small business accountancy will prepare for tougher times, including late payments, without the need for short term finance.

Electricians are classified as anyone who tests, maintains and installs electrical systems, appliances or equipment. A standard penalty charge may be any amount up to 100 percent of the tax which is owed. Under the tax amnesty scheme, the standard penalty will be 10 percent with a maximum penalty of 20 percent. Once registered, electricians have until 14th August 2012 to pay the tax owed to HMRC. If an electrician decides not to register for the scheme and is later found to have undisclosed income, the higher penalty rate will apply, with possible criminal prosecution proceedings.

This tax amnesty for electricians is the second phase of a campaign launched by HMRC to target tradespeople. Plumbers and heating engineers were among the first to be targeted by the campaign, with 14 arrests being made and one plumber jailed for tax evasion. More than £500 million has been collected through the voluntary disclosure campaigns, with another £110 million from follow up investigations.

Outsourcing to low cost accountants will ensure that you pay the correct amount of tax in a timely manner, while legitimately minimising your tax bill.

The BSA survey revealed that eight percent of the UK GDP was attributed to outsourcing, while it was also responsible for business taxes of £14 billion and £21 billion of income tax paid by the outsourcers. Only 19 percent of the UK public believe that outsourcing will help the country out of recession, according to the ‘Public Perception of Outsourcing’ report. The research also revealed that the public associated outsourcing with cutting jobs, cost cutting and India. The NOA considers the misunderstanding of what outsourcing is to be responsible for the negative outlook on outsourcing.

When asked for examples of outsourcing, customers gave a factory being opened in China by a sports brand to manufacture trainers. People also gave the example of a call centre in India being opened by a bank. As no outsourcing is involved in either of these projects, the level of misunderstanding appears to be high.

Outsourcing is particularly useful to businesses, especially in times of economic uncertainty, which is why a number of companies will include outsourcing in their business strategy discussions with their small business accountancy.

An initial penalty of £100 was charged to those who missed the filing deadline, but since 1st May a daily £10 penalty is being added to the amount. In addition to these charges, interest is being charged daily for any tax due which remains unpaid. A large number of individuals may not owe any tax but a self assessment tax return still has to be completed to show income for the year 2010-11. The daily fines will eventually reach £900 at the end of July if the tax return still hasn’t been submitted. At this time another instant penalty will be charged, although it will increase to £300.

Anyone who employs a low cost accountant to deal with their self assessment tax return on their behalf will have avoided the penalties, as the return will have been filed in a timely manner. However, anyone who still has to file their return is advised to consult an accountant firm which will submit the form on their behalf, limiting penalties and interest payments. HMRC will show lenience to anyone with a genuine reason for failing to file on time.

The CBI director-general John Cridland pointed out that the rest of the year would still face difficulties, including the high price of oil, Eurozone concerns and low confidence from the public. He said:

“We have always said that the path back to sustainable economic growth will be a long and difficult one, with many bumps along the way. To re-balance our economy towards exports and investment will take time and patience.”

According to the CBI, borrowing for the public sector will be higher than the Office for Budget Responsibility forecast and interest rates will remain static until the last quarter of 2013. The chief economic advisor for CBI, Ian McCafferty, forecast growth for April to June would remain static as a result of the additional bank holiday for the Queen’s Diamond Jubilee.

Consultation with a small business accountancy will prepare businesses for any effects caused as a result of the additional bank holiday, avoiding unforeseen circumstances.

A spokeswoman for HMRC disagreed with the minister, saying that the customer service centre was improving, with 60 million calls each year being handled by HMRC staff in contact centres. She also made it clear that peak times would be much busier and therefore it would be harder to get through to an advisor. The spokeswoman said that extra staff would be deployed during particularly demanding periods.

The long waiting times are a particular problem for small business owners, who may need to speak to an advisor but are short of time. Outsourcing to a small business accountancy can solve that problem, especially if the accountant deals with HMRC on behalf of the business.

The phone lines for the contact centre are open from eight in the morning until eight at night, Monday to Friday. On Saturdays, the contact centre is open from eight until four. The busiest time to call is between 11am and 3pm, the times best avoided if possible. The figures were released after the start of the daily penalty notices were issued on Tuesday 1st May, with 12,000 being issued in error.

It is believed that the increase in higher rate tax payers is due to the threshold for higher rates being cut, so that taxpayers are charged at 40 percent at a much lower rate than previously.

The Chartered Institute of Taxation’s John Whiting said:

“The combination of that happy couple, fiscal drag and cuts in the higher rate threshold, is pushing more people into the higher rates where they can contribute more to cutting the deficit.”

As personal allowances are due to be increased again in the new tax year, the amount of taxpayers will diminish as more low earners are below the threshold for paying tax. In 2010-2011, 27.1 million taxpayers paid tax at the basic rate, compared to this year which expects only 24.8 million to be basic rate taxpayers.

The additional rate of tax which was introduced in 2010-2011 proved to be ineffective and unpopular. The Chancellor made the decision to cut the additional rate down to 45 percent in 2013-2014. Outsourcing financial affairs to low cost accountants will minimise your tax bill legitimately.

Late payments have become a serious problem for 23 percent of the companies which acknowledged an issue with late payments, while 16 percent had come close to losing their business. Late payments are a huge threat to the survival of a company, its profits and future growth. The late payments culture can also affect other companies further down the chain, as 56 percent of businesses had to defer a payment themselves as a direct result of being paid late. Almost a quarter of businesses hadn’t been able to invest in growth as a result of late payments.

The external spokesperson for Graydon UK, Gordon Skaljak said:

“The current economic climate makes it more important than ever that companies clearly understand the risks and opportunities associated with their operations. This includes identifying the cash flow and other risks triggered by the late payment of trade invoices by customers.”

A business which has implemented procedures for credit control is more likely to become victim to late payments, according to the survey results. Discussing options with a small business accountancy will ensure that procedures are in place to counter late payments made or payments which are withheld by customers.

A spokesperson for HMRC has said:

“Anyone who gets a penalty warning notice and knows they have spoken to us and we agreed that they don’t need to complete a return can simply ignore it. We are writing to them to apologise and explain.”

Following an extended filing deadline of 2nd February 2012, the daily penalties of £10 will start to build up from 1st May 2012. Taxpayers who were expected to file but didn’t submit a self assessment tax return by the deadline will have been contacted by HMRC during February and March. According to HMRC there are 650,000 taxpayers who still haven’t submitted their self assessment tax return, but need to immediately. Daily penalties will be incurred by these taxpayers from Tuesday 1st May legitimately. Over 130,000 taxpayers have been removed from the self assessment system and HMRC offer assurances that they won’t receive penalties.

The completion and submission of a self assessment tax return has to be dealt with in a timely manner to avoid unnecessary penalties and fines, which is why a number of small businesses outsource to low cost accountants.

Employers have to comply with a huge number of employment checks and obligations prior to hiring an employee. The website provides information on topics such as obtaining the correct insurance, setting the rate of pay, making sure an employee is allowed to work within the UK and compliance with tax obligations. Failure to comply with the employment regulations can result in huge penalties.

Norman Lamb, the Minister for Employment Relations, admits that the employment process can be daunting for new employers without access to simple guidance. The toolkit has been designed to encourage sole traders and small businesses to employ a workforce, making it easier to comply with the regulations. However, sole traders and one man businesses that outsource to a small business accountancy won’t have to refer to the website, as they can obtain advice and support directly from their accountant.

The toolkit was launched following evidence that employers found the employment process too complicated. The national chairman of the Federation of Small Businesses, John Walker said:

“Taking on an employee can be a daunting, expensive and risky process and 13 percent of FSB members have said one-to-one support would help them take on staff. Having a one-stop-shop to get quick access to all the information needed to recruit will help firms that want to grow.”