The Federation of Small Businesses (FSB) recently called on the government to make drastic reforms for struggling businesses who have been hit the hardest by the energy and living crisis. This comes after the organisation stated that 53% of SMEs in the UK are projected to stagnate, decline or close in the next year. The FSB also estimated that a typical business in London, with a 30kWh annual consumption, would see the cost of its annual electricity bill increase from £4,700 to £21,200 – with their gas bill jumping from £1,350 to £7,050.
In addition to this, their latest data revealed that 1,800 companies across England and Wales registered for insolvency in July, with many being forced to close their doors due to simply not being able to keep up with rising costs. Whilst businesses across the board are currently navigating a significant loss in capital, research shows that over £20 billion of tax benefits still remains unclaimed every year, and could act as a lifeline for flailing businesses, as well as those who have taken this opportunity to prepare for the challenging times ahead.
Amidst an economic recession that’s bedding in, combined with an energy crisis so severe it’s set to plunge millions of families into fuel poverty, Brits are looking for any means necessary to assist with soaring costs. That is why Tommy Mcnally, leading tax expert and CEO of Tommys Tax, has provided his top tips for business owners who are looking for any means necessary to cope with the current economic climate.
Claim a tax refund on the more costly expenses:
“Many business owners may not be aware of the extent to which tax refunds could assist with the current financial pressures they’re facing. For instance, you can generally claim back 100% of the tax on office spaces, any technology such as laptops, phones, antivirus and office software, printing, and even bank, overdraft and credit card fees (if you’re using cash, you can claim only up to £500).”
Claim a flat £1000, or more:
“Currently, you can only claim £6 a week for home utilities such as any energy, phone or internet bills, for example – however, if you consider the overall amount you can claim back on all of the previous things combined, you could be left with a significant amount in your pocket. You can either claim a flat £1000 using the trading allowance, or claim every single business expense if this exceeds £1000.”
Prepay any upcoming expenses:
“From experience, I recommend that business owners prepay any upcoming expenses they may have such as any memberships or insurance plans because ultimately, you’ll likely be able to claim everything back.”
Be on top of things and record everything:
“Be diligent with keeping all your receipts and bank statements, and it will make the entire process a lot easier when the time comes. Record every transaction into your business account and make sure that you’re on top of reviewing your credit card statements.”
Start an emergency fund:
“The current economic climate has also highlighted the importance of maintaining an emergency fund for your business. This could reduce the need to borrow money, and prevent business owners from having to make touch financial decisions to keep the business alive. Some banks recommend having at least three months’ worth of your business expense in this fund – however, the more you can store away, the better.”
Claim back your payroll admin fees:
“Business owners and those who are self-employed can claim a tax-refund on payroll admin fees if the company is charged after requesting a payroll firm to overtake all their admin and payroll duties.”
Tommy Mcnally, leading tax expert and CEO of Tommys Tax, comments:
“For the majority of people, taxes can be boring, confusing and anxiety-inducing, which is why millions of tax rebates are left unclaimed. Knowing what you can and can’t claim for isn’t easy to understand, however with our service, it becomes so simple and allows people to claim what’s rightfully theirs. With nearly everyone impacted by the increase of cost of living across the board, there are ways in which people can inject a much needed-boost into their bank accounts.”
