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London’s small firms hit with £8.2bn business rates bill

The business rates bill hitting London firms will rise to £8.2bn today, raising the prospect that firms could move out of central parts of the capital due to high property costs.

Both the national living wage and business rates increase across the UK today, and, according to the Federation of Small Businesses (FSB), London now pays 33.1 per cent of the country’s total business rates bill.

Meanwhile, the national living wage will rise by 4.4 per cent today, from £7.50 per hour to £7.83 per hour.

High property costs are threatening to push some businesses out of the centre of London. A recent survey from the FSB found that 60 per cent of Zone 1 firms fear they will not be able to afford their current premises in five years.

Sue Terpilowski, London policy chair at the FSB, said there should be a major review of the business rates system.

“Many small business in London will see their business rates increase upwards of 20 per cent on 1 April,” she said.

“The high cost of doing business is putting additional pressure on wages and inflation for London businesses. The cost of employing staff generally and the heavy burden of cripplingly high commercial space costs is having additional negative impacts on small businesses.”

Source: City A.M.

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New business rates changes to help Scots businesses to ‘thrive’

NEW business rates changes coming into force in April will help stimulate the economy and improve transparency, the Scottish Government has said.

From April 1, there will be no business rates for unoccupied new properties and tenants who take them on will be rates-free for the first year.

Where properties are improved, they will not pay any additional rates as a result of the improvement for 12 months.

Eligible childcare day nurseries will receive up to 100 per cent relief.

The changes were announced last September following the Barclay review of business rates.

Finance Secretary Derek Mackay marked the start of the new policies by visiting The Orchard Nursery in Edinburgh.

He said: “These changes – many of which are unique to Scotland – will help our businesses to continue to thrive while also ensuring they make an appropriate contribution to important local services. When I appointed Ken Barclay to review the rates system, I tasked him with updating it to better support business growth, encourage long-term investment and enable businesses to better navigate fast-changing marketplaces.

“The changes we put in place – in many ways going further than the Barclay recommendations – also allowed us to offer wider benefits, such as supporting the expansion in funded early learning and childcare entitlement with the relief for nurseries. I’ve been impressed with what I’ve seen at The Orchard Nursery and hearing how they intend to use the savings they will make next year.”

The Scottish Government said the relief for nurseries was designed to support nursery provision throughout Scotland by reducing overheads for nursery owners, saving the sector around £6 million next year.

Vicky Coia, owner of The Orchard Nursery, welcomed the changes.

She said: “We are pleased the Scottish Government has led the way by creating business rate relief for the nursery sector across Scotland. It will allow us to invest in more training, staffing and resources to enhance staff practice and the opportunities and experiences we offer the children and their families.”

Andy Willox, the Federation of Small Businesses (FSB) Scottish policy convenor, said: “These new measures from the Scottish Government take us a step closer to developing a fairer, smarter rates system. FSB made the case for these changes in our submission to the recent rates review, and we’re pleased to see ministers turn them into real help for local firms.

“Local nurseries are a prime example of smaller businesses that are fundamental to the success of their local community and economy. These new rates should ensure that they aren’t penalised because they operate from specialised premises.

“At FSB, we’re firmly of the belief that if a business makes an improvement to their property they should be given an opportunity to recoup their costs before facing a higher bill. The Scottish Government’s new business accelerator relief does exactly that.”

The Barclay review set out 30 recommendations for changes to the business rates system in Scotland.

Two of the report’s recommendations were rejected. Farms will not be placed on the Valuation Roll and they will continue to be exempt from rates. Large-scale food processing plants on agricultural land will also not become subject to business rates.

Source: The National

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FSB launches new FinTech platform to fund small business growth

A new FinTech platform regulated by the FSA launches today (10 January) aiming to help further the success of the UK’s small business and self-employed communities amid the findings of latest research that the cost of doing business in the capital is stifling small firms.

Access to finance is crucial to the small business sector which accounts for an annual turnover of £1.9 trillion a year – 51 per cent of all private sector turnover in the UK.

The FSB Funding Platform, developed by Finpoint, uses intelligent matching technology to match applicants with over 100 finance providers.

A pilot of the platform for FSB members in three UK regions shows that the average amount of finance a small business applies for from an alternative finance provider is £39,000 – half the amount sought from banks’. With 40 per cent of small businesses seeking alternative finance for equipment purchases and 40 per cent for working capital to fund short-term operations or cover late payments.

FSB’s London Chair, Michael Lassman said:

“We’re so pleased to be able to offer this exciting platform to our member base. Although it’s harnessing the latest innovations in tech it offers a very simple way to access finance, as well as access to human financial advisers. It will transform the business funding market and is a real step change for small businesses.”

Finpoint Managing Director Guy Bridge explained:

“We saw not enough transparency in the market, and we remain motivated by how we can use technology to provide an efficient service, but perhaps most importantly, we were keen on providing high quality customer service, which means any one of us may be on the phone when you call us up with a question about your funding needs. We quite like the label “FinTech”, because it is a mixture of Technology and Financial Services, with a heavy emphasis on “service.

“We’re thrilled to have been awarded the contract to provide FSB’s funding platform. As a small business ourselves – and a member of FSB – we get what’s needed, how small business would like to use the platform and we’re truly excited.”

Source: London Loves Business