SMEs Call For Lower Tax Rate
8th January 2018.
Small and medium-sized enterprises (SMES) could now be paying a higher rate of tax than bigger businesses, an accountancy firm has claimed.
Moore Stephens has found that SMEs paid a rate of corporation tax of 21.7 percent in 2016. This is higher than large firms with a turnover of more than £1 billion, which paid an effective rate of just 20.1 percent.
The study has said this reverses the position smaller businesses were in just a few years ago when they benefited from a corporation tax rate discount.
In 2010, SMES were paying the tax rate of 21 percent while larger businesses paid 28 percent. The rate paid by large companies has been progressively lowered to match the rate of small companies, despite their disparate turnover.
Moore Stephens partner Mike Cooper criticises previous tax reductions for focussing too much on larger businesses. Cooper encourages a corporation tax discount for the SME sector, which will further support the “dynamic enterprise culture” that the UK aspires to and support the sector’s drive for growth.
He further insisted that small businesses are better informed of the tax reliefs that are on offer, with larger businesses often better acquainted with what’s available.
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