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The IPSE has called on the government to increase the VAT threshold in order to stimulate small business growth and encourage innovation.

In its official submission to the government’s VAT call for evidence, IPSE warned against decreasing the current £85,000-threshold, as they believe that this would actively discourage the self-employed and many small businesses from growing beyond the threshold and provide EU businesses with an economic advantage.

Instead, it is calling on the government to raise the threshold in line with RPI. This would follow a trend which saw the threshold pegged to the RPI from 1980 until it was frozen in 2017.

Andy Chamberlain, IPSE’s Deputy Director of Policy, commented, “Lowering the VAT threshold would be disastrous for the UK economy, particularly during the uncertainty posed by Brexit. It would be an inhibiting move that would serve only to impede business growth and drag more people into red tape. The cash-flow problems caused by such a move would mean people would face the stark choice of either raising their prices – causing them to lose customers – or absorbing the cost themselves, which would do significant damage to their businesses.”

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“Increasing the VAT threshold in line with RPI would provide businesses with that much needed certainty as our imminent withdrawal from the EU approaches. Presently, the self-employed contribute £271 billion to the UK economy every year – that’s enough to find the NHS, twice. Increasing the VAT threshold would create a nurturing environment for our smallest business to thrive, expand and further increase the overwhelming value they provide.”

To find out more about contracting please contact Sophie on 01442 795 100 or email sophie.lewis@dolanaccountancy.com

Why Thousands of Contractors Choose Dolan Accountancy

With over 25 years experience in contractor accountancy helping thousands of contractors, freelancers and the self employed, Dolan Accountancy has the specialist skills, reputation and credibility you can trust.

Working closely with our sister company, Contractor Umbrella, it means we can offer one low cost, fixed fee package at £105 + VAT. This gives you the flexibility of using both our Limited Company Accountancy Services and our award winning Umbrella Service, for one inclusive cost.

If you’d like to find out more about how Dolan Accountancy can help you and your business, please give us a call on 01442 795 100 or email sophie.lewis@dolanaccountancy.com or jaime.thorpe@dolanaccountancy.com.

We don’t believe in tiered packages or hidden extra fees, instead we aim to give you everything you need, including:

  • Free Company Formation – This is where it all begins. Once you have decided on an available name, we will form your company free of charge (if using our accountancy services) and it will be ready for you to use in as little as three hours
  • Free use of Contractor Umbrella – With IR35 Legislation changes we understand that sometimes you are required to contract via an umbrella company. We will keep your limited company ticking over, while you work margin free via our sister company, Contractor Umbrella
  • A Dedicated Accountant – Your accountant will be there for any company or personal tax advice that you require. We will never outsource work, even to internal teams
  • Free Access to FreeAgent – We offer all of our clients access to FreeAgent, free of charge
  • Free Business Banking – We have decided to waive our commission so our clients can use Tide free of charge for the first year
  • Unlimited IR35 Status Reviews – We will review all of your contracts for IR35 purposes and provide you with our professional opinion as to its status
  • Free Registered and Director’s Service Office Address – Sometimes you just don’t want your home address on display at Companies House. When you sign up to our accountancy services, we will offer the use of our address as an alternative
  • Your Business and Personal Taxation Needs – This includes Company Accounts, Director’s Personal Tax Return, VAT Returns, Payroll, Corporation Tax and Dividend advice, to name just a few
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