Government proposals to make it simpler for small businesses to deal with
VAT could save IFAs up to £1,000 a year, according to Treasury
minister Paul Boateng.
The proposals are for businesses with a taxable turnover of up to
£100,000 a year to have their bookkeeping requirements simplified by
Customs & Excise's flat rate scheme.
As part of the scheme, IFA firms are urged to reply to the proposals in
the Government's consultation document by September 7.
Small businesses are currently required to keep detailed records of every
sale and purchase and complete a VAT return usually every three months.
This has been criticised by small businesses as too heavy a compliance
burden. Under the flat rate proposals, businesses will simply calculate
their net VAT liability as a percentage of their total turnover and will no
longer have to keep records of every sale or purchase.
Boateng says: “We need small businesses to look at these proposals to
ensure they are as practical and simple as possible.”
Sofa spokeswoman Jo Smith says: “For the small IFA practice dealing with
all sorts of new regulation and legislation, any move that simplifies
backroom compliance must be good.”