After the election brought about another hung parliament, the incoming Government, however that is ultimately made up, will have a number of issues to address from an accountants’ point of view. Various bodies and individuals have been quick to express their views on what the profession wants to see from its new government.
On everyone’s wish list is tax. The UK tax system has for some time been viewed sceptically and negatively by the public, with corporate evasion or avoidance via loop holes a particular bone of contention. So after simplifying and restoring faith in the system, Making Tax Digital is high on the agenda for accountants, particularly with Brexit looming. There is some concern that there has been no official update on the initiative in a while and that the proposed 2019 deadline for its launch will now not be achievable.
IR35 is another area that needs simplifying or rethinking, many accountants believe. The latest amends were poorly received and may potentially spell the end for many contractors in the public sector due to the inequality with the current legislation, with the chief executive of the Association of Independent Professionals and the Self Employed saying that “damage control” is required. Given the number of self-employed individuals across the UK, it’s a huge area of consideration.
The lifeblood of the UK economy, SME’s need more support from a new government, according to many, including the ICAEW. Given more than 40% of SME’s in the capital would rather reverse the Brexit decision, in order to help them succeed, small businesses will need incentivising to start exporting. Easier access to finance and a simplified tax system will also help.
Another area to address that would support both SME’s and the self-employed (as well as make life easier for accountants) are late payments. With only half of invoices paid on time, businesses can be crippled and go under due to late payments. The government is planning to address this with a newly created position, which will hopefully make a difference.
And finally, the new government itself needs to be fit for purpose with the requisite financial management expertise and systems in-house. With the UK deficit growing and the complicated Brexit package to set out, it’s crucial that the government itself is ready for the task in hand.