It is expected that a package of measures for small businesses will be announced in next week’s Autumn Statement, including controversial proposals to give employees tax-free shares in their employer’s company in return for surrendering their workplace rights.
Despite opposition to the so-called “employee owner” scheme from unions, on the grounds that employees could lose out on unfair dismissal and other rights, it is expected that the Government will fast track the scheme through Parliament next year.
Although it could cost the Government £100m through the loss of capital gains on profits made from the shares over the next five years, the Government is keen for the plan to go ahead.
Small business owners are also hoping that changes will be made to the new real-time information (RTI) reporting on PAYE that comes in next year.
Described as the biggest changes since payroll taxes began in 1944, the RTI scheme is causing concern amongst business owners because of the radical changes it will bring.
In addition, recent surveys have shown that few small businesses are aware of the changes or of its implications in terms of time and money, although HM Revenue & Customs (HMRC) says that RTI will simplify the PAYE process and reduce the burden on employers.
However, most business owners remain unconvinced and are looking to the Chancellor to make the system more flexible and to cut the red tape surrounding the scheme when he speaks on December 5.
Concerns about RTI centre on the taking on of casual labour and what to do if employers have limited access to technology, as the system hinges on payroll software.
Other measures that may be announced in the budget regarding small businesses include making it easier for firms with a turnover below the VAT threshold to switch to cash accounting.
As an accountant, Sarah Jenkins, specialises in management accounting, business development and financial reporting.