Small businesses are likely to find the new Pay As You Earn (PAYE) system difficult to work with and time-consuming, according to a national accountancy body.
The Institute of Chartered Accountants in England and Wales (ICAEW) has suggested that new requirements, such as Real Time Information (RTI), will create an additional burden on small businesses that are already snowed under due to high levels of bureaucracy.
Currently, businesses deduct tax and national insurance from wages and settle payments with HMRC on a monthly or quarterly basis. However, the new system means an electronic payment will have to be made to HMRC ‘on or before’ payments are made to employees.
The head of the ICAEW’s Tax Faculty, Frank Haskew, expressed his concern on the impact the changes will have on the UK’s small businesses, which play a vital part in supporting the UK economy.
“It (the ‘on or before’ rule) will add significantly to compliance costs and burdens for many small and medium sized businesses,” he suggested.
A helping hand for small businesses
With small businesses continuing to face numerous pressures from the macro environment, it can be hard for owners and directors to prioritise growing their business and increasing levels of profit whilst having to jump through various regulatory hoops.
However, small businesses that issue invoices can benefit from invoice finance facilities, designed to help such businesses free up their time and cashflow.
Invoice factoring is a type of invoice finance facility that provides a cashflow boost by funding invoices upfront. It is also able to free up your staff from time-consuming credit control activities.
Why not browse our website to find out more about how invoice factoring works, or give our team of experts a call on 01756 694933 for a no-obligation quote.
"We have a very friendly relationship with Skipton Business Finance, their staff are always ready to answer any queries we have with our invoice finance facility" - Chris at a herbal medicines supplier in Lincolnshire