A reduction in business rates as well as corporation tax are just some of the things that an accountancy firm owner is hoping to see from tomorrow’s Autumn Statement.
Dan Heelan runs Heelan Associates, an accounting firm that works with a range of businesses from across all industries, from startups to well established small businesses.
He is hoping that when Chancellor Jeremy Hunt delivers the Autumn Statement on Wednesday November 22 that he will promise several things to support small businesses and encourage more people to earn more.
One of the things that he believes is damaging to businesses at the moment is the current business rates. He says that smaller hospitality firms such as coffee shops and pubs are particularly feeling the pinch, due to rising costs caused by inflation.
Currently, businesses which operate outside of a domestic setting have to pay business rates if the property from which they operate is valued at more than £12,000.
These business rates represent a significant cost for many small businesses operating from a bricks and mortar venue. With rising utilities costs, and many other prices for items the business needs to operate increasing, the high level of business rates is being felt more than ever.
Dan is hoping to see a decrease in business rates, or at least more support for businesses which are struggling to pay.
He said: ‘Small independent businesses could be wiped out due to these costs. It won’t matter as much to multi-million pound companies who can more easily absorb the cost but to small bricks and mortar businesses like a small family-run coffee shop for example, it could result in them no longer being able to afford to trade.’
He is also hoping to see a reform in the way that child benefit is given. Currently, when a person earns more than £50,000, they begin to have to repay their child benefit – Dan believes this threshold is too low and discourages people from earning more.
He said: ‘There are certain things, such as the High Income Child Benefit Charge, which are not catching up with inflation. £50,000 isn’t a huge amount of money when you begin to factor in childcare costs and increasing prices across the board. At some earnings levels, it would make more sense for someone to work – and therefore earn – less to ensure they are staying below the threshold.
‘I’ve had employees turn down extra hours due to this. It seems backwards to discourage people from earning a higher income – and contributing to UK productivity.’
Overall, Dan is finding that the state of UK businesses is positive and he is optimistic about the future of trade.
He said: ‘Despite people holding back on the more inexpensive things, such as coffees and haircuts, we’re seeing a strange pattern in that people are saving their money for more high-ticket purchases, like new cars or holidays. It seems that spending habits are changing, which sadly means lower-ticket businesses are suffering. I’m hoping that in time things will level out and that people will be less reluctant to buy a take-away coffee or go out for dinner.’
