Business Bank to be operational in April

The Government’s new Business Bank becomes operational in April 2013 and will manage a £300 million investment programme aimed at  encouraging the growth of smaller lenders and a £75 million capital fund for early stage firms, in plans announced by BIS. The Business Bank will also manage existing government finance schemes including the Enterprise Finance Guarantee (EFG), the Start Up Loans programme and Enterprise Capital Funds. The bank will remain part of BIS until autumn 2014 when it will become a new institution.
To read more about the Business Bank, go to:
https://www.gov.uk/government/publications/building-the-business-bank-strategy-update

RTI to be relaxed for small businesses

Real Time Information (RTI) reporting requirements are set to be eased for small firms HMRC has announced. Until 5 October, HMRC has agreed that firms with less than 50 employees that pay their staff weekly or more frequently can send information monthly or by the date of their regular payroll run but no later than the end of the tax month. The announcement follows calls from the Federation of Small Businesses (FSB) for the Government to replace RTI with a ‘Regular Time Information’ system. HMRC said they will assess the impact of RTI on the smallest firms during the summer and consider improvements to the current system if needed.
Read more on the new requirements at:
http://www.hmrc.gov.uk/news/rti-small-businesses.htm

Free intellectual property clinics for small firms

A series of free clinics offering advice and support on intellectual property for small and start up businesses have been launched by the Chartered Institute of Patent Attorneys (CIPA) and the Institute of Trade Mark Attorneys (ITMA). Small business owners who attend the clinics will receive a 30-minute consultation covering what intellectual property assets businesses have (including patents, trade marks, designs and copyright), how they can be protected and the best next steps to take. The clinics will be held at the Intellectual Property Office (IPO) in London on dates throughout 2013.
There is more on the clinics at:
http://www.cipa.org.uk/pages/whatsnew/article?CF1255F0-9952-4398-82C2-C520D59F2538

Budget 2013

Welcome to this budget edition of our news page, with a summary of the most relevant and important measures announced by the Chancellor in his 2013 Budget.
Key points affecting small and medium-sized businesses include:
Taxation
•    The main rate of corporation tax will be reduced to 20% from April 2015.
•    The VAT registration threshold will be increased to £79,000 from April 2013 and the deregistration threshold increased to £77,000.
•    The income tax personal allowance will be increased to £10,000 from April 2014.
•    The Government is to consult on plans to simplify and reduce administration for self-employed people, by using Self Assessment to collect Class 2 National Insurance Contributions (NICs) alongside income tax and Class 4 NICs.
•    From April 2014, all businesses will be eligible for an Employment Allowance of £2,000 to offset against their NICs.
•    The Government will extend capital gains tax relief to encourage investors to take up the Seed Enterprise Investment Scheme (SEIS). Investors making capital gains in tax year 2013-14 will receive 50% capital gains tax relief when they reinvest those gains into seed companies during tax year 2013-14 and 2014-15.
•    A consultation will take place in Summer 2013 on plans to introduce tax relief to encourage private investment in social enterprise.
Growth and support
•    £1.6 billion of funding will be provided to support the life sciences and aerospace sectors, and will be allocated by the end of 2013.
•    Several strategies for supporting the creative industries has been announced, including a competition of £15 million launched by the Technology Strategy Board for digital content production by specialist small businesses, educational research facilities and training providers; increasing funding for the Skills Investment Fund to £8 million each year for the next two years; and launching a public consultation on plans to provide support to the visual effects industry.
•    The Government will launch a £30 million Growth Vouchers programme for small and medium-sized enterprises in England, to help them overcome barriers to growth, such as limited access to external advice.
•    The Government has accepted the majority of the recommendations made in the Heseltine Review on economic growth, for example creating a Single Local Growth Fund allocated to Local Enterprise Partnerships (LEPs) to support local economic growth. The Single Local Growth Fund will be operational from April 2015.
•    The new Business Bank will introduce a £300 million investment scheme to help diversify sources of funding for small and medium-sized businesses; provide £75 million of funding for venture capital; and increase funding of the Enterprise Finance Guarantee (EFG) scheme to encourage lenders to provide finance to small firms.
•    The Small Business Research Initiative (SBRI) will increase the value of government contracts available to smaller firms from £40 million to over £100 million in 2013-14, and rising to over £200 million in 2014-15.

The full Budget report and associated notices are available from HM Treasury at:
http://www.hm-treasury.gov.uk/budget2013.htm

Small firms unaware of available export support

Small and medium-sized firms are not aware of available export support from organisations such as UK Trade and Investment (UKTI) and UK Export Finance (UKEF), according to a report published by the House of Lords Select Committee on Small and Medium-Sized Enterprises. The report revealed only 21 firms received help from UKEF between March 2011 and August 2012, and stated that more needed to be done to get the word out to businesses and promote export support through business support organisations, banks, accountants and Local Enterprise Partnerships (LEPs). Chairman of the Committee Lord Cope said “help is there but not enough small and medium-sized enterprises know where to find it.”
There is more on the report at:
http://www.parliament.uk/business/committees/committees-a-z/lords-select/
small-medium-enterprises-committee/news/house-of-lords-committee-welcome-
benefits-of-increased-exporting-by-smes-but-says-government-must-do-more-
to-ensure-smes-know-where-to-find-export-help/

Small business owners fail to claim back expenses

Only one in four business owners claim back all of their personal business expenses, according to a survey by YouGov on behalf of accounting software firm FreeAgent. The main reasons business owners gave for not claiming back expenses included worries about being challenged by HMRC, forgetting or losing receipts and the amount of admin required. The research also found that three quarters of small business owners and freelancers were concerned about their taxes, with some saying they felt anxious about the current tax system. Ed Molyneux of FreeAgent said: “It’s clear that expenses and tax are big issues for people who run small businesses.”
Read more on the survey at:
http://yougov.co.uk/news/2013/03/05/expenses-small-business-owners/

Top ten most burdensome laws for small firms revealed

EU legislation surrounding VAT, product safety, waste disposal and data protection are among the most burdensome for small and medium-sized enterprises, a consultation by the European Commission (EC) has revealed. The idea behind the consultation was to identify where EU regulation is becoming restrictive to jobs and growth and to reduce any unnecessary red tape for small firms. The EC said it would introduce a range of measures to lessen the burden on smaller firms, such as conducting impact assessments of new laws affecting small firms, simplifying and updating legislation and making it simpler and more efficient to comply with.
Read more on the consultation at:
http://www.eubusiness.com/topics/sme/law-burdens

Early competition boosts survival rate of firms, survey finds

Firms faced with high levels of competition in the early stages of starting up have a better chance of long-term survival, according to a study by the Bettany Centre for Entrepreneurship. The study found that, although firms starting up in a competitive marketplace had a lower survival rate after one year, by the third year, their survival rate was higher than those launched in a less competitive market. Study author Professor Andrew Burke said: “A challenging environment causes start ups to be tightly focused on satisfying customer needs along with lowering and containing costs, both of which boost firm performance.”
Read more on the study at:
http://www.som.cranfield.ac.uk/som/som_applications/somapps/
oepcontent.aspx?pageid=14249&apptype=newsrelease&id=4771

Small firms ‘secure more Government contracts’

The value of Government contracts secured by SMEs increased from £3.2 billion in 2010/11 to £4.4 billion in 2011/12, according to figures published by the Cabinet Office. In addition, the Government’s major suppliers increased spending with these firms in their supply chain by 6%. Cabinet Office minister Chloe Smith said the Government had improved procurement procedures and reduced bureaucracy to make it easier for smaller suppliers to win contracts.
Read more on the figures at:
http://www.publicservice.co.uk/news_story.asp?id=22306