The Chancellor recently announced changes to the taxation of dividends. These changes will have a significant impact on the small and micro business community. The Pension Review Service helps many hard working business owners with Automatic enrolment, pension and other financial issues.
The Federation of Small Businesses statistics show small businesses employed over 15m people in 2014. The owners of these businesses perhaps contrary to popular myth, do not take home significant salaries and the Government seem constantly intent on making their life more difficult. We suggest it may be time to give them a break (join the campaign).
We have noted the dramatic increase in small business costs over recent months including the cost of automatic enrolment, and a 10% increase in the minimum wage. The Dividend Tax announced by the Chancellor in the summer of 2015 is, we suggest, a step too far.
The reasons behind the change may be understandable as the Chancellor tries to reduce the complexity of the tax system but the resulting effective extra 7.5% tax on earnings has stunned the owner manager community.
Serena Humphrey, owner of Nottingham based financial training company The F Word has set up a campaign to halt the new tax. She said ‘There is massive interest in scrapping the tax on dividends and helping small and medium sized enterprises have a better chance of surviving. We’re asking the Government to reconsider the tax’.