Accountants plead for end to red tape barrier

Mar 1 2010 by Karen Dent, The Journal

BARRIERS that stop small and medium-sized business from succeeding must be removed by the next Government, according to the Association of Accounting Technicians (AAT).

The organisation is demanding a reduction in the red tape which is holding back SMEs. It said Britain’s 4.8 million smaller firms are being put off from recruiting staff by bureaucracy, despite the national unemployment figure heading towards 1.64 million.

Rob Alder, AAT’s business development manager, said: “Even a recession is not discouraging people from starting up a business. However, statistics show that 25% will fail in their first year and for many, the reasons boil down to excessive rules and regulations imposed upon them.

“If these barriers are reduced, not only will SMEs be likely to employ more people but they will have better odds of survival.”

The Federation of Small Business (FSB) estimates that around 500,000 people start up a new business annually and the AAT pointed to a daunting list of regulations they must abide by. It said that in the pressure of running a business meant deadlines for Income Tax, National Insurance, VAT, PAYE and Corporation Tax could easily be missed, leaving entrepreneurs facing crippling penalties for late submissions.