No expense aired: why SMEs are missing out on tax rebates

A survey suggests a fifth of businesses don't know how much they pay out in expenses each month. Duck islands all round, then...

by Emma Haslett
Last Updated: 06 Sep 2011
After all the hoo-ha about them in Parliament, you’d have thought that by now, the upper echelons of most businesses would be pretty hot when it comes to the expenses their employees claim. But not enough, apparently: a survey by Concur (admittedly a ‘provider of expense management solutions’ so, y’know, keen to prove this sort of thing) has found that a fifth of businesses aren’t aware of how much they’re paying in expenses every month. But that doesn’t just mean their workers could be sneaking all manner of mallard shelters and moat maintenance bills past them – it could also mean they’re missing out on tax reductions – aka. cold, hard cash…

Yep – as the survey of 400 small business owners points out, firms are entitled to reductions on tax for certain expenses. But, rather disappointingly, the survey also suggested that 40% of entrepreneurs aren’t entirely convinced the records they’re keeping of their employees’ expenses are comprehensive enough for them to be able to claim any tax reductions they’re entitled to, while just over a quarter ‘aren’t sure’. Which doesn’t bode particularly well.

It’s not just tax rebates businesses are missing out on, though. Apparently, only 11.7% known how much they’re paying out ‘to the penny’, while a third of businesses say that only their accountant knows how much they’re paying out every month. They’re missing a trick there: businesses which know how much they’re paying in expenses, and to whom, can negotiate deals with suppliers their employees frequent the most (like this one, perhaps).  

Still: the good news is that almost 84% of businesses say they have a ‘written policy’ on the sorts of things employees are allowed to claim as expenses. If only someone had suggested that to our esteemed leaders a few years ago, Westminster might have avoided an awful lot of embarrassment…

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