Mitchell Charlesworth calls on Chancellor to deliver pro-enterprise tax-package in Autumn Statement


North West accountancy firm Mitchell Charlesworth is calling on the Chancellor to deliver a package of pro-enterprise tax incentives in the upcoming Autumn Statement.

The firm is calling for clearer structures, broader relief and greater assurances across tax affairs to give businesses more power to thrust regional economic growth.

Mitchell Charlesworth has offices in Liverpool, Manchester, Chester, Warrington and Widnes.

Mitchell Charlesworth tax partner Tim Adcock said a number of measures can be taken to drive greater levels of investment, innovation and enterprise.

We believe that fundamental changes can be made to our current tax system to help businesses drive greater productivity and growth,” he said. “We have a series of recommendations which we have broken down into a seven-point plan.

“Firstly, we would like to see the incorporation of a dedicated HMRC department to deal specifically with international tax affairs. This will bring greater certainty to people whose tax affairs are not entirely UK based. It is currently anything but clear-cut.

“Secondly, we would like to see a change to the quarterly instalment regime for corporation tax. Certain businesses are required to forecast tax liability which inevitably leads to guesswork. A system based around retrospective payments would be quicker and clearer to manage and cutting back on administrative bureaucracy.

“Furthermore, Mitchell Charlesworth would like to see greater tax relief for corporate investors. A reintroduction of the corporate venturing scheme for example would encourage higher levels of equity investment and help a significant number of SMEs to raise funds for further development.

“A fixed position on the Annual Investment Allowance will also give businesses greater certainty to plan for the future. The allowance, which provides firms with a 100pc allowance for tools and equipment, has fluctuated greatly since being introduced in 2008. We understand that recent increases have been designed to bring forward capital expenditure. However, that is not always possible.

“A key tax area which we know really hurts SMEs is business rate increases. Based on the rate of RPI inflation recorded in September, business rates are due to rise by 2.3pc next April. We believe this tax disproportionally affects SMEs and propose a freeze on any increases.

“Mitchell Charlesworth is also calling for greater clarification on inheritance tax,” said Mr Adcock. “The current inheritance tax threshold per individual is £325,000. This has been fixed until 2017/18, although there are rumblings this rate may be increased earlier. People need to be given greater assurance on this point plan accordingly with tax legislation.

“A final area we would like action regards the VAT procedure for SMEs. It is widely acknowledged that the UK VAT system is one of the most complex. SMEs can be just as complex as large businesses from a VAT perspective. Yet many do not have a central contact within HMRC. This can lead to difficulty in getting VAT treatment of a supply correct, and result in penalties for ‘careless’ behaviour.

“We would welcome a shift from the “careless penalty” culture towards more support for SMEs. This should come in the form of experienced VAT staff on hand to provide technical advice, rather than limiting businesses to help lines and long-winded online enquiry forms.”

For more information on accounting, business advice and taxation matters contact Mitchell Charlesworth on 0151 2552300 or their marketing manager at  phillip.ward@mitchellcharlesworth.co.uk  

Ends

Mitchell Charlesworth seven-point “Autumn Statement” wish list

1.Certainty for companies/individuals with international tax affairs in the form of a dedicated HMRC department tasked with receiving and responding to International tax and residency clarification/clearance applications,

 2. A change to the corporation tax quarterly instalment regime so as to base it on the previous years’ corporation tax liability rather than forecasting next years,

 3. Tax reliefs akin to EIS for corporate investors

 4. Capital Allowances – a fixed position for the annual investment allowance going forwards rather than the forever changing limit

 5. A freeze on the proposed business rate increases – a tax that hurts SME’s significantly

 6. Clarification on the proposed nil rate band for inheritance tax post the current limit freeze

 7. A structured clearance procedure for VAT to provide business with certainty on VAT affairs

 

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