The economy of the UK depends on the financial health and well-being of the more than 5.5 million small and medium-sized businesses (SMBs) around the country. But SMBs aren’t always given a seat at the policymaking table.
Small businesses and accountants drive economic growth in the UK and need champions to help them power prosperity. That’s why Intuit asked small business owners and accountants about their wishes from policymakers regarding challenges they face, resources they need, and how policymakers can help them succeed.
Access to the innovative tools, data, and solutions that will help them compete with larger companies and on the global stage were top of mind. With the partnership of the private sector and government, small businesses and accountants can get the resources they need to thrive.
Small businesses and accountants are calling time on late payments.
Businesses of all sizes need to get paid on time to meet their payroll, hire workers, invest in new products or services, and grow their operations. Late payments can hinder these much-needed investments and are especially difficult for SMBs who may not have deep capital reserves.
According to Good Business Pays, it typically takes corporations 90+ days to pay SMBs, impacting their operational cash flow. Unfortunately, late payments are becoming more prevalent. In fact, 81% of UK accounting firms report late payments, hindering their ability to serve SMBs.
Kofi Ohene-Djan, Owner, Founder, and CMO at OSUNO Marketing in Liverpool wishes that policymakers understood the impact late payments have: ‘Late payments can cause issues and ruin cash flow. Timely payments are critical for a business to function properly. Policymakers should incentivise companies to pay on time or early.’
Helen Matthews, owner of the Kent-based SUP with Us, a paddleboarding company, noted: ‘Increased access to financial management software could really help with late payments so businesses can stay on top of what they’re owed. It automates reminders to clients, which is always the most awkward part!’
Intuit is proud to partner with Good Business Pays to raise awareness about the challenges that late payments create for small businesses. Creating a fair payment culture could boost economic growth and unlock financial confidence for the UK’s more than 5 million small businesses. Government can help by supporting the adoption of digital payment tracking tools, encouraging favourable invoice payment terms, and incentivising expedited payments.
AI can help small businesses and accountants grow and do more.
More than 400,000 UK SMBs have adopted at least one AI technology, and these tools help level the playing field against their larger competitors. In the last year, 59% of accountants have used AI to reduce errors and spend more time helping their clients. But many SMBs struggle to adopt AI tools because of the up-front investment costs and the lack of learning resources to help SMBs and accountants maximize the potential benefits of AI in their businesses.
Amy Hancock, Director of Hancock & Hastings Limited in Dunstable and Bedfordshire, touches on the need for incentivising innovation: ‘Expanding tax incentives for companies that invest in AI research and development will hopefully increase innovation. I’m hoping to use AI to streamline my operational processes.’
Aaron Patrick, head of Accounts at accounting firm Boffix agreed: ‘It would be beneficial for the government to incentivise companies to expedite the development of AI tools for accounting. Even with the current limited set of tools, I’ve seen significant positive impact.’
For over 5 years, Intuit has been driving AI innovation to help our customers solve their most important problems. Intuit QuickBooks AI tools help simplify business operations by automating, predicting, and personalising our customers’ experience. Intuit Mailchimp AI tools help businesses create engaging content quickly and easily, personalising customer experiences at scale. Intuit is committed to connecting UK small businesses and accountants with innovative, AI-powered tools to help them now and for years to come.
Government can help UK SMBs and accountants better leverage and access AI technologies by supporting risk-based regulation, prioritising consistent policies, and enabling AI education and apprenticeships.
There’s a clear correlation between the use of digital tools and growth.
Small businesses that adopt digital tools are more likely to grow and expand. In fact, according to the Intuit QuickBooks Small Business Index, 63% of UK SMBs surveyed using 8+ digital tools are more confident in their ability to secure financing.
Elaine and Peter Kinsella, Founders and Co-owners of Lunya and Lunyalita in Liverpool, talked about the impact of adopting digital tools: ‘Help more small businesses go digital. For us, digitisation improved how quickly we can access and share information, allowing us to streamline operations.’
Charlene Nevin, Director of H2B Toys in Tonbridge, believes that, ‘Being a highly digital business is critical to our success as a small business. Seeing how technology has grown and changed in the past years, policymakers must help small businesses evolve to meet those new digital standards.’
Digital tools like Intuit QuickBooks help SMBs increase VAT accuracy, efficiently communicate with HMRC, and improve their financial confidence. Policymakers can help by providing educational resources, modernising government programs for SMBs, and accelerating digital adoption through private-sector collaboration
Making Tax Digital will improve efficiency, increase accuracy, and boost business growth.
UK accountants believe that Making Tax Digital (MTD) improves efficiency, increases accuracy, and boosts business growth. MTD enables faster, more accurate tax procedures, with the potential to generate an additional £3.8B per year.
Eriona Bajrakurtaj, CEO at Major’s Accounts & Co in London, noted: ‘Getting more clients onto digital systems will enable them to send us their information in real time. With digital tools, we can provide HMRC what they need in a matter of seconds.’
Annette Pettitt, the founder of Leight Park Accountancy in Bradford-on-Avon, agreed: ‘MTD will give businesses the ability to operate with real-time data and drive digitalisation gains, accuracy, and efficiencies critical to the future growth of the economy.’
Intuit QuickBooks is proud to have become the first major provider recognised by HMRC for the MTD ITSA beta testing phase, furthering digitalisation for SMBs and accountants.
Government can help by providing educational resources about MTD and accelerating digital adoption through private-sector collaboration.
Building on Open Banking will continue to improve managing finances for accountants and small businesses.
Open Finance will be transformative for UK SMBs and the larger economy, potentially boosting GDP by £30.5B per year. The Open Banking framework has already made it easier for 73% of UK SMBs to share information and collaborate with their accountants.
Cliff Orme, MI, Cloud Accounting and Systems Manager at DSG Chartered Accountants in Liverpool, shared: ‘Open Banking has been a big-time saver in regards to data input. Previously, a big part of accounting work involved manually reconciling data. With Open Banking’s expansion, we could streamline more business operations.’
Abdul Nurujjaman of Taj Accountants in London, stated, ‘Open Banking helps prevent fraud. It gives us current data. The more we can continue to build on Open Banking, the better and easier it will get for us to manage our finances and our client’s finances.’
Most UK small businesses report that using Open Banking improves efficiency with their accountants. Allowing more data sets into an Open Finance framework will be transformative for accountants, SMBs, and the UK economy. Policymakers can further build on the success of Open Banking to help small businesses and accountants by allowing more datasets into an Open Finance framework, continuing to build upon Open Banking standards, and leveraging public- and private-sector partnerships.
Small businesses and accountants power the UK economy.
UK entrepreneurs are facing a changing market landscape that will influence their operations and ability to scale. It’s important that small businesses and accountant voices are represented in crucial policy conversations.
Investing in small businesses, entrepreneurs, and the accountants that serve them has the potential to spur job creation, increase innovation, and yield tax revenue to bolster the UK economy. Let’s help the UK’s small businesses unlock their full potential.
You can see all of the policy wishes of the SMBs and accountants surveyed below.