£210m relief on rates for small traders

BRITAIN’S hard-pressed small businesses were thrown a £210m lifeline when George Osborne extended a key tax relief.

The small business rate relief scheme, which had been due to expire in October next year, will run until April 2013.

Firms will also be given the chance to defer 60 per cent of the increase in 2012-13 rates, which they were facing as a result of the increase under the RPI measure of inflation. They will have to repay what is owed over the next two years.

Patrick Harrison, partner at PKF, said: “Cash is king at the moment for SMEs so any measure that helps cashflow should not be sniffed at. The level of business rates that an organisation has to pay is based on their premises rather than their profitability, so the tax holiday should be especially welcome at a time when corporate profits are being squeezed.”

John Walker, chairman of the Federation of Small Businesses, said policy must be translated into “tangible actions on the ground”.