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Budget 12: Tax for small firms set for ‘radical change’

The Chancellor has revealed he is aiming to simplify the tax administration system for small firms with turnover of up to £77,000.

Delivering his Budget statement in the House of Commons this afternoon, Chancellor George Osborne said he wants to bring in a system which will “radically change the administration of tax for small firms”.

The idea, which will be consulted on, will be centred around basing small firms’ tax calculation on the amount of cash that passes through the business.

Osborne says approximately three million small firms will benefit from what he says will be “simpler” tax calculations.

The Chancellor also hinted at further plans to merge national insurance and income tax, with a consultation paper to be published next month.

For Money Marketing’s full coverage of the Budget click here.

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  1. What a really bad idea so you are effectively taxed on your turnover rather than your profit.

    As anybody knows you can have turnover but still not make a profit at the end of the year. This could be a real mistake a real punitive tax on small businesses particularly start-ups.

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