According to Bishop Fleming, the accountancy firm with the widest spread of offices throughout the South West, yesterday’s Autumn statement contained good news for the region.
Andrew Browne, senior tax partner at Bishop Fleming, said: “The region’s business owners should welcome the delayed 1% increase in small company rate of Corporation Tax, and the new ability for tax relief on £50,000 losses to be carried back 3 years, rather than one year at present.
“More helpful, perhaps, is the new Business Payment Support Service, enabling businesses with cash flow difficulties to spread their business tax payments for PAYE, NI, VAT, and corporation tax. Until recently, the taxman’s demands for instant payment were the cause of too many business collapses.
“But the best news for small companies, is that Mr Darling made no mention of the proposals to outlaw spouse-payment, that were due to take effect next year. If that plan has been ‘shelved’, it could be of benefit to 418,000 SMEs in the South West.
“Today’s announcement of relief from the planned new tax on owners of empty properties with rateable values below £15,000 will be of real benefit to more than three quarters (77%) of empty properties in the South West region.
He added, however: “Unfortunately, however, there is a downside for all businesses. The 0.5% NI increase for both employees and employers from April 2011 will put an extra strain on costs and employment.
“While Mr Darling reiterated the Government’s expectation that banks should now return to their 2007 level of lending to businesses, and announced a panel to monitor performance, there was no mention of how the banks can be forced to deliver.
“It was also interesting that the tax increases announced today take effect in 2011, when the economy is expected to begin its rise from recession – and after an election!” said Mr Browne.