We're here with practical information for your business. Learn about business planning, running a business and more.

For a successful business, you need a viable business idea, the skills to make it work and the funding. Discover whether your idea has what it takes.

Forming your business correctly is essential to ensure you are protected and you comply with the rules. Learn how to set up your business.

It is likely you will need funding to start your business unless you have your own money. Discover some of the main sources of start up funding.

Businesses and individuals must account for and pay various taxes. Understand your tax obligations and how to file, account and pay any taxes you owe.

Businesses are required to comply with a wide range of business laws. We introduce the main rules and regulations you must comply with.

Learn why business planning is an essential exercise if your business is to start and grow successfully, attract funding or target new markets.

Marketing matters. It drives sales and helps promote your brand and products. Discover how to market your business and reach your target customers.

Some businesses need a high street location whilst others can be run from home. Understand the key factors from cost to location, size to security.

Your employees can your biggest asset. They can also be your biggest challenge. We explain how to recruitment and manage staff successfully.

It is likely your business could not function without some form of IT. Learn how to specify, buy, maintain and secure your business IT.

Few businesses manage the leap from start up to high-growth business. Learn what it takes to scale up and take your business to the next level.

SME costs rise due to government policy

29 January 2019

SME costs rise due to government policySmall businesses are spending 15% more on taxes, rates, levies and employment obligations compared to 2011.

The increase amounts to an average surge of £60,000 in costs per year, according to the latest Impact of Government Policy Index, compiled by the Centre for Economics and Business Research (Cebr) for the Federation of Small Businesses (FSB).

The index - which analyses a range of policy-linked obligations, including business rates and auto-enrolment - has found that the average VAT-registered UK small business spends over £480,000 each year on these interventions, up from £420,000 six years ago.

Previous FSB research showed that small firms each lose an average of £5,000 and three working weeks a year to tax administration and paperwork.

Labour-intensive industries are being hit particularly hard by government interventions, according to the index. Smaller businesses in the construction sector have suffered a 28% increase in policy-linked costs.

Simply DocsStart up templates

Save £5 and pay £30 for a year's access to 740 templates including customisable company formation documents. Use code SLD7948.S

Find out more

Employment costs have soared since 2011. The minimum hourly pay rate for a member of staff over the age of 25 has risen by 29% in that time. The rate is set to increase by a further 5% in April.

Employers must also make national insurance contributions of more than £1,000 a year for qualifying employees and - from next year - their minimum contribution to auto-enrolment schemes will rise to 3% of eligible staff earnings.

The research comes as the UK falls from fourth to ninth place in the World Bank's Ease of Doing Business index and to 34th in the World Economic Forum's Burden of Government Regulation rankings.

"In 2011 the UK was ranked the fourth best place in the world to do business. Today, it's ranked ninth," said Mike Cherry, FSB national chairman.

"Despite some welcome announcements from the chancellor in October, small firms are still set to see costs spiral as the result of government policies in the months ahead. Come the beginning of April, small firms will not only have Brexit day to worry about but also Making Tax Digital, a higher living wage, rising employer auto-enrolment contributions and further business rates hikes. This will be a flashpoint for a lot of businesses, one which could threaten the futures of many."

Cherry added: "Government officials scratch their heads over why small UK firms don't expand at the same pace and frequency of small businesses elsewhere. Clearly, the burden placed on business owners as they grow their workforces needs to be looked at. The minute you start firing on all cylinders as a business owner - stepping up your hiring, investment and sales activity - you're struck with an avalanche of additional cost burdens. That has to change. Proactive efforts should be made to address the debilitating cumulative impact of these interventions on small firms."

News type:

Stay up-to-date with business advice and news

Sign up to this lively and colourful newsletter for new and more established small businesses.

Contact us

Make an enquiry