News

Optimism among the UK’s entrepreneurs has risen to its highest level in five years according to a report by Deloitte. More than 80% of entrepreneurs believe that their businesses will grow by at least 10% over the next year. This is the highest number since the survey began in 2008. In addition, 56% of business owners said that they were confident enough to start dipping into their cash reserves to finance growth.

HM Revenue & Customs’s online services are to be suspended for three days from Friday 11 October as the department performs maintenance and upgrades on the site.

The work will mean many of the sites’ services will be unavailable during the time, although PAYE and RTI services will be unaffected.

The downtime will begin at 6am on Friday 11 October and run until 6am on Monday 14 October.

Interest rates will remain at 0.5 per cent until the employment rate has dropped to seven per cent, Mark Carney, the new Governor of the Bank of England has said.

He also said that the bank will not be reducing its £375bn asset purchase programme until that level is reached. The unemployment rate is currently at 7.8 per cent. Around 750,000 jobs will need to be created in order for the jobless rate to reach seven per cent, something which could take about three years, Carney suggested.

John Longworth, director-general of the British Chambers of Commerce (BCC), said that the governor’s decision to keep interest rates on hold will reassure business.

He suggested a fail in the unemployment rate to seven per cent is unlikely to happen in the next few years, so it looks as though interest rates will remain low for quite sometime.

Self-assessment taxpayers who have failed to submit tax returns are being offered the opportunity to settle their arrears in an HMRC campaign.

From this week, the campaign is aimed at people who have received a self-assessment tax return or notice to complete a tax return for any year up to 2011/12, but are yet to take action.

The scheme will see HMRC writing directly to several thousand people it has identified using intelligence-gathering software, before following up with calls to many of them.

This latest drive follows a similar initiative undertaken last year, which covered higher-rate taxpayers who had failed to submit 2008/09 or 2009/10 returns. That campaign yielded more than £30m when over 3000 people came forward filing more than 5500 returns.

Once participants have told HMRC they wish to take part in the campaign, they have until 15 October 2013 to complete and submit a return, and pay the tax and National Insurance Contributions (NICs) that they owe.

After 15 October, if they have not submitted their returns and paid the tax due, penalties of up to 100% of the tax, or even criminal investigation, could follow.

HMRC head of campaigns Marian Wilson said “This is definitely the best time to catch up, on the best possible terms. While some penalties will apply, it is likely to cost people more if we have to find them rather than them coming to us. We have made it easy to take part.

“We know this approach works because campaigns launched so far have produced more than &547m through people coming forward voluntarily. And evidence shows that people who change their behaviour voluntarily are more likely to remain compliant for longer. We will continue to analyse information using connect, our state-of-the-art risking engine, and will be looking more closely at people who have gaps in their tax records.”

Research has found that administration is one of the most time-consuming activities for small business owners in the UK.

According to the American Express Small Business Barometer, 55% of SME leaders listed admin as one of the three activities they spend most time doing. In addition, 48% listed strategy and planning, whilst 43% put customer relations in their top three.

The results suggest that many SME leaders are spending too much time with administering their businesses rather than utilising their creativity and dynamism to drive their business forward.

The research also found that SME leaders UK are happy with their jobs and optimistic about their business. Around 93% of small business owners are either “very” or “quite” happy with their business.

The main factors that promoted this job satisfaction were cited as “being master of my own destiny” (70%) “doing something i like or believe in” (66%) and “reaping the benefits of my own efforts” (42%).

Commenting on their performance for the first five months of this year, 40% of those interviewed said they had achieved growth, with 43% saying business had remained flat.

Looking ahead to the future, the barometer found that 56% of small business owners expected their business to grow over the coming year, with only 12% believing their business would contract.

The temporary relaxation of real-time PAYE reporting rules has been extended to April 2014, HM Revenue & Customs has announced.

Real-time information sees PAYE reported on or before the date payment is made, while changes will be reported as and when they occur, rather than at the end of the financial year.

Although the system commenced in April, following criticism from stakeholders and institutes, allowances were made for businesses with fewer than 50 employees, allowing them to continue reporting their payrolls monthly until the 5 October while they prepare.

That deadline has now been pushed back until April next year, meaning businesses will not be required to change their approach halfway through the tax year, HMRC said.

As with the current relaxation, businesses are still required to report through the new system, but are able to do so once a month, rather than each time they pay their employees.

HMRC has published the advisory fuel rates to operate from 1 June 2013.

Advisory fuel rates are HMRC-approved rates which apply where employers reimburse for business travel in their company cars, and where employees reimburse the cost of fuel for private travel in a company car. Using the advisory rates will mean that there is no fuel benefit charge. HMRC will also accept the figures in the table for VAT purposes, though employers will need to retain receipts.

Engine Size

Petrol

LPG

1400cc or less

15p

10p

1401cc to 2000cc

17p

12p

Over 2000cc

25p

18p

Engine Size

Diesel

1600cc or less

12p

1601cc to 2000cc

14p

Over 2000cc

18p

The new rates apply to all journeys on or after 1 June 2013 until further notice. For one month from the date of change, employers may use either the previous or new current rates, as they choose.

One in four people in the UK would consider loaning money to SMEs by joining a peer-to-peer (P2P) lending scheme in 2014 when the sector will be fully regulated by the Financial Conduct Authority, according to a new study peer-to-peer lending website rebuildingsociety.com.

The research also shows that 17 per cent would consider P2P lending over the next 12 months without the need for additional regulatory protection. However, the added security should reinforce the sector given money lent through P2P is currently not covered by the Financial Services Compensation Scheme (FSCS) and lenders could lose cash if borrowers default.

Peer-to-peer lending – also known as person-to-person lending, peer-to-peer investing and social lending – is the practice of lending money to businesses or individuals online.

The study also underlines the attraction of P2P schemes to small firms as around 24 per cent believe they will struggle to access finance in the next 12 months. Given this, 16 per cent of small businesses would consider applying for a P2P loan over the next year. The research suggests the biggest obstacle to the growth of P2P lending is low awareness with six in ten (59 per cent) consumers not understanding what the term meant. Furthermore, more than half (54 per cent) highlighted a lack of knowledge as the principle reason reason as to why they wouldn’t invest in a P2P scheme, followed by the fear of borrowers not repaying the loan (46%).

Daniel Rajkumar, managing director at rebuildingsociety.com, said “This research shows P2P lending is well on its way to entering the financial mainstream with strong levels of interest from consumers and SMEs alike.

“The FCA’s regulatory oversight from next year will provide consumers with an additional layer of protection and our study shows this is very likely to boost take-up.”