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Fairlop tax accountant: ‘Government failing on major issue for small businesses’

PUBLISHED: 15:00 27 September 2014

Gerald Powell, of TaxAssist Accountants in Fairlop

Gerald Powell, of TaxAssist Accountants in Fairlop

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Government proposals aimed at cutting red tape for small business “go nowhere near” addressing the hefty £40billion they are owed by big business, according to a Fairlop tax specialist.

Gerald Powell, who runs TaxAssist Accountants in Fencepiece Road, Barkingside, said clarification on zero hours contracts and new rules on bank lending will benefit small companies, but the plans won’t stop them being saddled with debts because of late-paying clients.

He said: “It shows the government is at last recognising the vital importance of small businesses to the local economy.

“But on one of the major issues faced by small business owners today – late payment by large companies – the bill goes nowhere near addressing the estimated £40 billion of debt small businesses are carrying for their big clients across the UK.

“All it says is that those companies will have to go public in their annual report, on how long they take to pay suppliers. That’s hardly going to stem the tide.”

He added it would also tackle rogue business owners who move assets around to avoid losing them when their company goes under.

“There will be some positive developments for small business owners if the bill does become law,” he said.

“It will give them crucial clarification on zero hour contracts, cut red tape and make it much more difficult for company owners to take assets out of a failing business and carry on trading as a new company – often leaving major debts behind with the small businesses who supply them.”

Government minister for skills and enterprise, Matthew Hancock, said: “This bill will open up new opportunities for small companies to innovate, compete and get finance, to create jobs, to grow and export.

“It’ll make sure the UK continues to be recognised globally as a fair place in which to do business.”

Read more:

Budget is ‘neutral’ for businesses, says Redbridge Chamber of Commerce


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