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- December 1, 2011 - Ghost of Christmas Past - Have you... More →
- October 12, 2011 - Real Time Information - summary of responses - HMRC have... More →
- October 10, 2011 - Removing red tape – I don’t think - In August... More →
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(about 18 hours ago) - Around 900,000 taxpayers who filed their 2010/11 Self Assessment returns late will start getting penalty notices from HMRC this week.
(about 2 days ago)
Removing red tape – I don’t think
Posted by Niki on October 10th 2011 @ 1:28 pm
In August 2011, the Department for Business Innovation and Skills (BIS) issued a discussion paper entitled Simpler Reporting for the Smallest Businesses. The BIS argues that small companies suffer from over-complex and burdensome reporting requirements that need simplification. The simplification proposals remain vague at the moment and are currently alongside the Office of Tax Simplification’s consultations on small business taxation.
The proposals are based around the concept that a profit and loss account with accompanying balance sheet are somehow burdensome to produce. So instead, small limited companies would file a simplified trading statement put together on a cash (not accruals) basis. This would be accompanied by a statement of position – which we think will basically be a list of assets and liabilities – and a simplified annual return. In order to make this system work however, there would be a requirement for returns to be filed within 12 weeks of the year-end (currently you get 9 months) and that all such entities will have to have the same year-end (date not yet determined).
Surely, this so called reduction in red tape only increases the burden on a whole host of small businesses – namely accountants who will have to introduce new procedures for cash reporting and no doubt buy more software add ons not to mention doing 12 months of work in 3. Like every other accountant out there, my training was based around certain principles; double entry book-keeping, balance sheets that fitted together with a P& L account and the accruals concept – cash reporting means nothing to anyone. You may as well do away with any reporting requirement as introduced this.
Incorporating a business comes with a bundle of burdens and responsibilities – another core plank of my training – if small entities feel this is too burdensome then don’t incorporate.
If the Government really want to help small businesses reduce red tape they should look at Money Laundering Regs, Data Protection, employment regulation and health and safety requirements. And don’t get me started on the new PAYE burdens – online filing, and coming soon NEST and real-time information. Clueless.
Post filed under Comment and tagged BIS, Red tape, smallest businesses.