Wylie & Bisset advises Scottish SMEs to invest in digitalisation and seek advice on tax reliefs
With a brace of recent reports revealing that Scottish SMEs are optimistic about the economy, chartered accountants Wylie & Bisset is advising business owners to act now to invest in digitalisation and seek advice on available tax reliefs to enable them to exploit the business opportunities arising from economic recovery.
Scottish SMEs are more confident about the economy reopening than their English counterparts, according to a new report by PayPal. With 65% of Scottish SMEs expecting the majority of consumers to continue shopping online, despite lockdown restrictions easing, businesses plan to continue investing in digitalisation.
Catherine Livingstone, head of the Business Advisory Services team at Wylie & Bisset, said: “The last 18 months have seen many of us working remotely and learning new technology to work effectively. This is true whether providing goods or services.
“Our job as advisers is to help clients embrace digitalisation whether it is the way they operate day to day or in the accounting software they use to provide their accounting and KPI information.
“From an accounting perspective, many SMEs have seen the benefits to be had from switching from a desktop or manual based accounting system to a digital cloud accounting system, for example Xero, as it enables them to see a real-time insight into their financial figures, with live data hosted in the cloud.
“This means business owners have up to date and accurate financial information in order to make the best decisions about the future of the business.”
That real-time insight to which Ms Livingstone refers might be important going forward as, according to the Federation of Small Businesses (FSB), almost two thirds of Scottish firms reported an increase in running costs in comparison to this time last year, while only 8% said their overheads had decreased. More Scottish firms also believe their profits will fall over the next three months than those who think they will increase.
That said, business optimism amongst Scottish smaller firms is at its strongest since the summer of 2015 with the FSB’s latest figures showing that the average Scottish business is now more hopeful about prospects than its UK-wide equivalent for the first time since the third quarter of 2020.
Commenting on these findings, Catherine McManus, tax partner at Wylie & Bisset, added: “While such business optimism is encouraging, a scenario of SMEs facing a rise in operating costs and falling profits highlights the importance of making the most of tax reliefs and I would advise owner/managers to seek professional advice about what is available to them to enable them to be best placed to exploit the potential for business growth as restrictions ease and economic recovery gathers pace.
“Reviews such as capital allowances reviews, R&D reviews and consideration of the timing and benefits of certain types of expenditure will prove beneficial to business owners. Enhanced loss reliefs and continued working with HMRC for those struggling to pay taxes will also be vital, especially for those industries, such as hospitality, hardest hit by the pandemic.”