Small firms 'missing out' on tax relief

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Many UK firms could be missing out on tax relief they could rightly claim (image credit: iStockphoto/AndreyPopov)

A significant proportion of the nation's small to medium-sized enterprises (SMEs) could be missing out on potential tax relief due to a lack understanding of the existing system.

This is the conclusion of new research from insurer Direct Line, after the company published a new study showing how almost half (46 per cent) of UK SME owners rate their current knowledge regarding UK tax structures as 'very poor'.

Overall, this equates to approximately 3.5 million SMEs across the UK and means that they are not currently benefiting from potential savings on their tax bills.

Other interesting results from the survey included the fact that almost one-fifth (18 per cent) of respondents would class their current tax knowledge as 'below average', while just six per cent said they felt they have a 'very good' understanding.

Finally, 36 per cent of respondents stated they were not aware of being eligible for any form of tax relief, although this may not be the actual case.

Nick Breton, head of Direct Line for Business, commented: "This research highlights that there is a lack of awareness of the benefits available to small business owners which can ultimately impact the development and growth of their business.

"The research shows SME owners do not know whether they are eligible for any tax relief measures, so we would encourage them to do some research and seek help if necessary to make sure they are taking full advantage of the benefits."