Here, Emily Coltman, chief accountant to cloud accounting provider FreeAgent, looks at the experiences of micro business owners in Britain to find out what it was like to run a small company in 2016.
it’s pretty common to read about small businesses, but it’s a lot rarer to hear aboutmicro businesses, the smallest type who either have no employees or only employ up to ten people.
In reality, micro businesses make up a staggering 95 per cent of all businesses in the UK that’s over five million people whose unique challenges arent often talked about in the media.
In 2016, FreeAgent, asked freelancers and micro business owners what it was really like to run the smallest kind of businesses in the UK. Over 500 people replied, weighing in on everything from Brexit and funding to work/life balance and the government’s digital tax proposals.
Here is a reflection on some of the findings:
The majority of micro business owners were against Brexit
Back in June before the referendum even took place FreeAgent discovered that nearly three-quarters of survey respondents were not in favour of the UK leaving the EU.
In addition, 72 per cent said that they thought Brexit would have a negative impact on the UK economy, while just five per cent said that it would be beneficial for their business.
However, this clearly had little effect on the result of the referendum itself, with a slender majority of voters opting for the UK to leave the EU.
Many micro business owners didnt know about Making Tax Digital
Making Tax Digital is a flagship proposal by the government to fully digitise tax by 2020 and essentially put an end to the traditional tax return (there was a consultation about the plans in the second half of 2016 -?read FreeAgent’s take here).
However, while those who were aware of the plans were generally positive about them, nearly half of those surveyed said they didnt actually know what Making Tax Digital was.
Most micro businesses don’t start up with government funding
Although the government revealed figures earlier this year showing that the Start Up Loans Company had reached total lending levels of 250m, FreeAgent’s survey showed that the overwhelming majority of small business owners do not rely on any kind of government funding to help cover their startup costs.
Emily Coltman is chief accountant to FreeAgent, provider of cloud accounting software for freelancers, micro businesses and accountants. She is passionate about helping the owners of small and growing businesses to escape their ?fear of the numbers? and she translates small business finance and tax into practical common sense speak.
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