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The Governemnt has announced that it's scrapping the Audit Reform and Corporate Governance Bill. The reason given is to reduce costs on firms. This programme of refrom has been in the pipeline and kicked into the long grass several times, since the collapse of the big construction company Carillion in 2018. It took thousands of small construction firms with it and the ripples reached out as far as small micro businesses on the sidelines like cafes. This isn't good news and leaves gaps which could mean that future corporate failures have a similar impact. Cutting red tape to boost the growth agenda has consequences and there will be losers.

Have you tried to find money to fund your business? If so did you need working capital or money to invest for growth. If the banks are persuaded by Government to lend more to small businesses that could be positive but only if businesses get the right typr of funding for the stage their business is at. Just getting a loan isn't the answer if the business will have problems, or get into deeped problems, trying to repay that loan or if it comes with the worn strings attached. I know of businesses where lending was dependent on personal guarantees and those guarantees were called on when the repayments fell behind. I know of businesses that got loans but weren't able to grow the business and ended up worse off trying to create enough income to service the loans. We need support for businesses to make sure they are ready for the funding, are looking for the best kind of funding for the stage their business is at and have the right support to make sure they are using the funding in the right way. It's about more than just money. Please let me know your experience.

The UK’s payments on account system catches a lot of new sole traders by surprise. Payments on account are advance payments towards your next Self Assessment tax bill (in this case for the year 25/26). You pay them on top of any tax you owe for the previous (24/25) tax year. HMRC uses payments on account to help spread the cost of your tax across the year rather than collecting it all at once. They apply mainly to: • self employed people • landlords • anyone with untaxed income They are based on last year’s tax bill HMRC assumes your income next year will be similar to the previous year. So each payment on account is half of your previous year’s tax bill. You make two instalments • 31 January • 31 July You may also need a “balancing payment” If your actual tax bill ends up higher than the two instalments you’ve already paid, you pay the difference the following 31 January. If you paid too much HMRC will refund you. You won’t be asked to make payments on account if either: • your last tax bill was £1,000 or less, or • 80% or more of your tax was already collected at source (e.g., PAYE). If your tax bill last year was £3,000, HMRC will ask you to pay: • £1,500 on 31 January • £1,500 on 31 July towards next year’s bill. If your actual bill ends up higher, you pay the extra as a balancing payment the following January. It’s particularly tough to find the additional money to pay on account if you’re fairly recently self-employed and weren’t expecting it. You may have put aside money to cover tax on the amount you were earning but not to cover the additional amount. HMRC doesn’t automatically require new sole traders to pay tax on account in their first year. The rules above apply, You will have to make Payments on Account if both of these apply: Your tax bill for the year is more than £1,000, after subtracting any tax already deducted at source (e.g., PAYE). Less than 80% of your total tax was collected at source. If those conditions apply, HMRC will ask you to make: • First payment on account: 31 January • Second payment on account: 31 July Each is normally 50% of your previous year’s tax bill. You won’t have to make Payments on Account if: • Your tax bill is £1,000 or less, or • More than 80% of your tax was already deducted (e.g., you still have PAYE employment), or • HMRC decides your first year’s liability is too low to trigger the system. This is very common for brand new sole traders whose first year is part time, low income, or mixed with PAYE work. If: You start self employment in 2025/26 and owe £600 in tax. → No payments on account. You owe £2,500, but you also have PAYE employment that covered 85% of your total tax. → No payments on account. You owe £2,500, and PAYE only covered 20%. → Yes. You will have to make payments on account. If you’re unsure whether you’ll cross the £1,000 threshold, try to set aside 20–30% of your profits so you’re covered whether payments on account apply or not. This is an example where a qualified accountant can keep you right. You may worry that the fees will be too expensive but accountants will keep you safe and probably save you money in the long run. Check their qualifications. Unqualified people calling themselves accountants have been known to give poor advice.

A–Z of Starting a Small Business in 2026 Here are the basics. You’ll want more detail and perhaps assistance to get all the processes right. Business111’s search function will point you in the right direction. Accounting, Automation and AI Set up bookkeeping from day one. Use simple tools (FreeAgent, QuickBooks, Xero) and automate invoicing, reminders, and expenses. AI tools can draft proposals, chase payments, and analyse cash flow. Business Plan & Business Model You don’t need a 40 page plan. You need clarity on: • what you sell • who you serve • how you make money • how you deliver • what it costs A one pager is enough to start with and constantly review and revise it. Cash Flow All important. Cash flow is the No.1 reason micro businesses fail. Build a buffer, forecast monthly, and protect yourself from late payments. The figures in your business are what really tell you the story. Digital Presence Your online footprint is your shopwindow if your business is online only. That means: • a simple website • an online Business Profile • one social platform you show up on consistently Expenses & Efficiency Track every cost. Claim allowable expenses (keep the records) Streamline your processes from the start and avoid stress later. Funding & Finance Explore grants, start up loans, local authority schemes, and sector specific funds. January is a key reset point for many funding programmes. GDPR & Data Protection Even micro businesses must comply. Have a privacy notice, secure data storage, and clear consent processes. HMRC Registration Register as self employed or set up a limited company. Understand tax obligations, payments on account, and allowable deductions. Insurance Most businesses need at least: • public liability • professional indemnity • employer’s liability (if you hire anyone) • cyber cover is increasingly essential. Journey Mapping Map the customer journey from their first contact with your business to repeat purchase. This helps you design better experiences and reduces the chances of losing customers to your competition. KPIs (Key Performance Indicators) Track what matters: • leads • conversion rate • average order value • customer lifetime value • monthly recurring revenue (if relevant) Legal Structure Choose between: • sole trader • limited company • partnership • CIC or social enterprise Each has different tax and reporting requirements (see Business111 Resources) Marketing Strategy Pick one core channel and master it. Consistency beats complexity. Networking & Niche Communities Join local business groups, sector networks, relevant or specialist communities, and business forums. Businesses thrive through connections and sharing tips and best practice. Operations Document your processes early: • onboarding • delivery • invoicing • customer service • refunds This saves time and supports growth. Pricing Price for sustainability, not survival. Yopu won’t survive if you’re only breaking even or can’t pay yourself a salary. Review your prices regularly and make sure you aren’t undercharging, which is a very common business mistake. Quality Control Whether you sell products or services, create simple quality standards. Consistency builds trust. Risk Management Think about: • cyber security • compliance with the regulations such as tax and VAT • supply chain • financial risks • reputational risks A basic risk register is enough. Sales Strategy Know your offer, your value, and your ideal customer. Create a simple sales script or pitch. Tax Understand: • income tax • corporation tax (if Ltd) • VAT thresholds • payments on account • allowable expenses Set aside 20–30% of profits to stay safe. USP (Unique Selling Proposition) What makes you different? Your story, your values, your niche, your method, all contribute to your competitive edge. Visibility Show up regularly. People buy from businesses they recognise and trust. Website A simple, clean, accessible website is enough. Include: • what you do • who you help • prices (if possible) • how to contact you • testimonials eXpectation Management Set clear expectations with customers: • timelines • deliverables • boundaries • communication channels This reduces complaints and increases loyalty as long as you stick to your promises. Yearly Planning Set annual goals, quarterly priorities, and monthly actions. Review and adjust to make sure you can be agile enough to respond to changes. Agility is a superpower. Zero Burnout Your wellbeing is a business asset as is that of any people you take on. You need a zero tolerance approach to anything that undermines wellbeing. Set boundaries, take breaks, and build a support network to avoid the feeling of isolation. If you aren’t thriving the business won’t either.

It’s that time of year. Many of us are thinking about how we’ll do things differently over the next 12 months with the aim of making our businesses thrive. After all the disruption and uncertainty coupled with challenges like the rising cost of doing business and customers with less money to spend, a new year seems like the ideal time for new approaches. I’ve been looking for a list of 12 resolutions, one a month, to work on over the coming year and as my business friends tell me I have to be specific, make ambitions measurable and realistic or they will end up abandoned in January. Here's my list: Build a cash flow buffer of 3–6 months Businesses fail more from cash flow shocks than poor sales. A buffer gives stability, bargaining power, and breathing space and could mean you don’t have to borrow at huge expense during the year if you have an invoice that doesn’t get paid when you expect it to. Raise prices strategically rather than emotionally Many small businesses undercharge because they’re scared of losing work or sales. Review your prices regularly, benchmark against your competitors, and increase prices realistically, adding value if you can. Automate the things you can automate Get the tech tools to do the jobs that drain your time: invoicing, chasing payments, onboarding, scheduling, stock checks. Yes they cost but they’re a real investment freeing you up to spend on the business rather than in the business. Time is better spent thinking and planning than filling in forms. Diversify income streams 2026 is the year of multiple revenue channels: • digital products • subscription add-ons • partnerships • B2B services • seasonal bundles Even one new revenue stream can make a business more resilient. Get paid fairly Many businesses lose money to unfair payments like overdue invoices or unfair terms in a contract. Change that: • Check the payment terms offered and negotiate better ones • automate reminders • ask for deposits, up front payments to cover stuff you have to pay for before work starts, or payment in stages as work is completed • charge interest and compensation if the payments are overdue (this is set out in legislation) la • use invoice chasing tools Getting money in when you expect it to come in can save you the expense of borrowing just to stay afloat. Invest in keeping your customers rather than having to find new ones Returning customers cost less and spend more. Think about: • loyalty perks • follow up support • personalised check ins • feedback loops Gather your data Even the smallest businesses can track: • cost per lead • conversion rates • top performing products • busiest days • customer lifetime value When you collect useful data you can review them regularly and use them to decide next steps. Build you story and spread it Businesses win on authenticity. Refresh your brand story, update your website, and show up consistently on one chosen platform to increase trust. Create a 12 Month Content Plan • 4 themes • 12 monthly focuses • weekly posts A plan helps reduce stress and builds authority. Factor in your own wellbeing and boundaries Burnout is real: • set working hours • take breaks • delegate • protect weekends If you are healthier the business will be too. Review your compliance and risk management All the following need regular auditing: • data protection • cyber security • employment practices • accessibility Build your support network Businesses thrive with the help of mentors and business advisers as well as groups of people who all want to help each: • local business groups or groups in your sector • sector networks • minority led communities • disability inclusive business forums • peer groups You may think you don’t have time for networking but networking with the right supportive groups can save you time and save you stress, isolation and money, perhaps even save your business. Here’s wishing all businesses a prosperous and thriving 2026.

The new Employment Rights coming in 2026 and 2027 The UK Government’s Employment Rights Bill has been passed by Parliament and is expected to receive Royal Assent before the end of 2025. This Bill is a major shift in the UK employment landscape. The reforms included in the Bill will be phased in over 2026 and 2027 and cover unfair dismissal, sick pay, parental leave, zero hours contracts, fire and rehire, trade union rights, harassment protections, and more. Unfair Dismissal • The length of time an employee has to work for an employer (the qualifying period) in order to make a claim for unfair dismissal will be reduced from 2 years to 6 months. • The cap on compensation will be removed, meaning claims could be uncapped. • These changes are expected to come into force in January 2027. Employment Tribunal Claims • The time limit for bringing employment tribunal claims will be extended from 3 months to 6 months for most claims. • That change is expected to come into force in October 2026. Fire and Rehire • Dismissing and rehiring on worse terms becomes automatically unfair dismissal, except in cases where the employer can prove that it was genuinely financially necessary. • That change is also expected to come into force from October 2026. Trade Union Rights from April 2026 • Industrial action ballots: Minimum 50% turnout required will be required and if that’s the case a simple majority will be sufficient to allow strike action. • Union recognition: The thresholds will be lowered, meaning easier access to workplaces (physical and digital). Parental Leave & Sick Pay • Employees will have rights to paternity leave, unpaid parental leave, and statutory sick pay from day one of their employment. • Statutory Sickpay will be payable from day one and the lower earnings limit will be removed. • These changes will come in from April 2026. Zero-Hours Contracts • Employers must offer contracts with guaranteed minimum hours. • Compensation will be required for shifts cancelled at short notice. • These changes are expected from 2027. Harassment • Employers must take all reasonable steps to prevent sexual harassment and that will include harassment by third parties. This duty was Strengthened from October 2024, and will be expanded in 2026. Collective Redundancy • An employer who is making roles redundant and doesn’t consult the workforce following the regulations will face higher penalties of 180 days’ gross pay per affected employee from April 2026 Fair Work Agency • From April 2026 there will be a new enforcement body to oversee employment rights. What do employers need to do to prepare for the changes? • Update policies on sick pay, parental leave, and redundancy by April 2026. • Review dismissal procedures ahead of 2027 to manage risk of uncapped claims. • Prepare contracts for zero-hours staff to include guaranteed hours. • Train managers on the changes and on harassment prevention and union access rights. We'll be following the detials as they emerge and thinking about the unintented consequences for small and micro businesses.

The Employment Rights Bill passed by Parliament yesterday evening 16th Dec. There have been amendments since the proposals were first announced. There will be day one rights to sick pay and bereavement leave but there will be a 6 month period before an employee can claim for unfair dismissal. More detail coming in my blog soon.

Unemployment hit 5.1%, the highest since January 2021 and wage growth slowed in the 3 months to October. Those figures were for the period before the budget, with all the uncertainty the various rumours and the speculation caused for businesses. Is that behind us now. Will business respond to the budget by getting on with the plans they had before uncertainty paused activity or will the quiet quitting we've been seeing especially in the retial and hospitality sectors continue. Let us know in the forum discussions what you're seeing in your sector.

Unemployment hit 5.1%, the highest since January 2021 and wage growth slowed in the 3 months to October. Those figures were for the period before the budget, with all the uncertainty the various rumours and the speculation caused for businesses. Is that behind us now. Will business respond to the budget by getting on with the plans they had before uncertainty paused activity or will the quiet quitting we've been seeing especially in the retail and hospitality sectors continue. Let us know in the forum discussions what you're seeing in your sector.

Government announces £2 million funding boost to help more small and medium sized businesses cut costs The funding is part of a range of new measures to support small business growth. Two thirds of small and medium businesses that adopted sustainable practices like installing solar panels reported reduced costs Small businesses across the UK will benefit from the Government funding and support to help them invest in sustainability, to cut their operating costs and boost their business. More detail to come.

The UK economy shrank by 0.1 per cent in October according to the Office for National Statistics (ONS). That’s on top of the 0.1% decline in September. There was no growth in August. The economy hasn’t grown since June. For a Government that put so much emphasis on the need for the economy to grow so that there’s money to spend of public services that’s not a good look. However, the word that’s been exercising me in the headlines is ‘unexpectedly’. Apparently, the fall was unexpected. Most economists were expecting to see a rise of 0.1 per cent for October, driven by Jaguar Land Rover’s recovery after the cyber attack on it in August which hit the manufacturing sector hard. I’m not an economist but as a business journalist I could often be heard to remark that if you asked 40 economists for their forecasts, you’d get 40 different assessments. So why then were economists apparently agreeing on the likelihood of growth? I think it’s because they are fixated on, and talking to, the wrong companies. The small and micro firms in the UK are the bellwether. What’s happening on the high streets, the industrial estates and on the other sector frontlines is where forecasts would be more accurately based. We’re in an economic mess with quiet quitting of small businesses going on all over the UK. Small business owners when asked are fairly optimistic about their own prospects next year but not about the wider economic picture or about the ecosystems they’re working in. The budget didn’t help, piling on the agony after the wages and NIC rises in April 2025. The shenanigans before the budget with the kite flying and leaks of supposed definite changes to be announced in the budget exacerbated the situation. Business owners kept their hands firmly in their pockets even if they did have money to spend, because of the uncertainty. I’d love to see the counter factual calculation that could show what the growth figure would have looked like had the seeds of uncertainly not been so widely and so frequently spread around the business community. The budget itself was a damp squib in terms of encouragement for businesses to get their hands out of their pockets and invest to grow. Small and micro owners, despite all the derogatory talk about lack of ambition for growth and productivity would love to adopt technology, hire talented people, reskill and upskill and grow. They need to feed families who are facing a cost of living crisis that’s been hanging around for years and they need to tackle their own cost to doing business crisis that’s been holding them back since 2008. We need support, radical solutions and a real voice at the table when the economists and politicians are musing about their forecasts and policies. The smallest businesses get the least air time but that’s the place to start. Given that there was next to nothing in the budget for the biggest business sector, the 0-50 employee businesses that provide 47% of the employment in the private sector, contribute £1,8trillion of our UK income and are the biggest innovators and job creators in good times, the budget needed to be radical, growth-focused and ambitious. Even the crumbs of good news, like more money for the British Business Bank to lend, weren’t new. We’re not growing, investing creating jobs and fewer of us are exporting. If you make it this hard for the small business owners, who are renowned for getting going when the going gets tough then you should be expecting the economy to reduce rather than grow. We need the government to understand the needs of small business, entrepreneurs, the risk-takers and reward them, encourage them, incentivise them and get their help to build a clear plan for growth. Only then, and of course I’m not an economist so what would I know, will we get 3 or 4% growth and that growth will lead to further growth. I do know that you have to build from the bottom up rather than the top down. Trickle down has been shown not to work. Trickle up can, with the will and the power, experience and innovation of our smallest businesses.

More than a quarter of small businesses are having problems recruiting because of a shortage of qualified applicants and although the shortages of skilled people are fairly stable, they're persistent. The figures are from the Office of National Statistics for November. The unemployment figures are going up but if the people looking for work don't have the skills you're looking for you've got recruitment problems. We need the right people in our businesses to help us grow and the costs of recruitment and wages, including National Insurance Contributions are so high that it's leaving small businesses unable to compete with their bigger competitors even if they have decided to hire. How do we resolve this situation?

I’ve seen a flurry of questions over the weekend on the rules around selling your personal belongings that you no longer want. If you are simply selling stuff to get rid of it and declutter you aren’t running a business. If you’re selling things that you’ve made for the purpose of selling and making an income as a business, you’re trading. The rules are different in these cases. If you’re just selling your own unwanted personal belongings online, you usually don’t have to pay tax. However, if you sell items for £6,000 or more you may owe Capital Gains Tax, and if you’re regularly buying or making items to sell for profit, you may owe Income Tax once your earnings exceed the £1,000 trading allowance. Selling Personal Possessions No Income Tax if you’re simply selling unwanted possessions like clothes, furniture, phones, jewellery, or household goods Capital Gains Tax (CGT) may apply if a single item sells for £6,000 or more or a set of items (e.g., matching ornaments, book collections) sells for £6,000 or more in total. HMRC treats collections as one item for CGT purposes Trading vs Selling personal items: If you buy or make items to sell for profit (e.g., crafts, vintage resale, upcycling), HMRC considers this trading. You get a £1,000 trading allowance per tax year so if your total trading income is £1,000 or less, you don’t need to declare it. If it’s above £1,000, you must register with HMRC and submit a Self Assessment form every year on which you put the detail of you earnings from all sources and you may owe tax depending on your total income. Platform Reporting Rules (from 2025) Online platforms (e.g., eBay, Vinted, Etsy, Depop) must report sellers’ earnings to HMRC if: o You sell more than 30 items, or o Earn more then £1,735 in a year. This doesn’t automatically mean you owe tax, but HMRC will check if your selling counts as trading and will take your total income from all sources into consideration. Personal Tax Allowance Even if you have more income than the £1,000 trading allowance, you only pay tax once your total income (job + side sales or pension income or income from some other source) is more than the personal allowance (£12,570). However be carfeul. Even if items are second-hand, frequent resale for profit can leave you having to pay tax. Keep receipts and records of sales to prove whether items were personal possessions or trading stock. If you don’t declare trading income above £1,000 you could face fines.

If you are one of the people to lose your job and are looking for employment you'll know that unemployment is rising too. If you're thinking of working for yourself in any way: freelance, sole trader or running a small business you'll find information at Business111

Businesses cut jobs by 1.8% on average in November according to the Bank of England and it’s expected that there will be a further fall of 0.7% in the next year. Unemployment is already at 5% according to the latest ONS figures. When firms cut jobs and unemployment is growing people looking for work and finding that hard, often decide to take the big step into self-employment, setting up as a sole traders, working freelance or perhaps starting up a small business. The bills still have to be paid. People may not start out those ventures with the ambition to grow but that could become a possibility in future. For many though the question is ‘where do I find the information to help me get started’. We’ve set up www.business111.com for precisely that reason. People constantly tell me that they know the information is out there somewhere but they don’t know where or how to find it. Business111 is the tool to help you navigate to the sources of information you need. We’re not adding to the over-information. We know it’s already available. We want to help you find the right information for you at the right stage of your business. We’re at the start too and want to build from here. Register with us. It’s free. Then tell us what’s working and what isn’t, what you need that isn’t there, and add reliable sources you’ve found that have helped you. Share your experiences and reliable sources of help in our forum too. Let’s aggregate, curate and share to help each other and others thrive.

Small Business Saturday is the first Saturday every December. Look out for the signs in shop windows. The idea is to get shoppers to do their shopping from small businesses especially at this point in the year when Christmas is approaching. Are you taking aprt this year and if so what difference does the campaign make to the volume of sales in your business? How could we encourage more small business shopping all year round to help keep our high streets and small businesses alive?

There are plans to make e-invoicing the way to do business from 2029. There's lots of time to get ready but many firms are using e-invoicing already. If your customers require you to use their e-invoicing platforms what's your experience? Please share.

As a small business what are the digital tools that you use most in your business and do you have a feel for how much time they save on admin? If you do have that extra time how does that help you to work on your business? Would liove to hear from you.