The first month of 2012 is almost at an end. The days are getting longer and, while temperatures aren’t showing signs of rising just yet, it’s getting slightly easier to believe that spring will one day arrive.

But will 2012 be a springtime for British businesses emerging from the long winter of recession, or is the economic climate set to get harsher still?

January’s business news provides rather a mixed forecast:

1. HMRC showing welcome readiness to resolve small business tax disputes. (DOF Online)

HM Revenue and Customs has (rightly) come in for a bit of a barracking in recent years. Making secret tax deals with corporations like Vodafone and fouling up PAYE tax codes for 1.4m people in 2010 has significantly undermined confidence in the government department. They’ve also repeatedly been accused of victimising small businesses in order to increase the tax take and help cut the UK deficit. A move by HMRC to introduce a new Alternative Dispute Resolution service aimed at small to medium sized enterprises is welcome then, as outlined in this article from Director of Finance Online, though time will tell whether the new system makes it out of pilot and how much good it will do.

2. Small businesses are the ‘real internet companies’ says, er, Google(?!) (Telegraph)

In a rare display of humbleness for the search engine giant, Google exec Matt Brittin said at a conference in Brussels that online behemoths like Skype, eBay and Google istelf are not the ‘real internet businesses’ but that that title rests with SMEs, the ‘unsung heroes of the economy’. It seems that Google doesn’t mind a bit of competition after all – presumably as long as that competition isn’t offering a product or service that Google itself offers and is too small to pose any kind of threat.

3. Small business lending still weakdespite project Merlin (Telegraph)

Project Merlin, an agreement between the Government and the top four banks (Barclays, Lloyds, RBS and HSBC) was finalised almost a year ago in February 2011. The terms were that those banks would lend a total of £190bn to business in 2011 including £76bn to small businesses. So how did they do? Not very well apparently. The banks not only missed those small business targets but also saw a drop in new business lending of 6.1% year-on-year in the three months to November. What are the prospects for this situation changing? Pretty bleak as even larger businesses are now reporting that bank credit is hard to get. As the banks continue getting their balance sheets in order to better cope with the Eurozone crisis small businesses are urged to try alternative sources of investment capital such as http://www.fundingcircle.com/ – a peer to peer social lending programme or http://www.crowdcube.com/ – a crowdfunding enterprise.

4. Auto enrolment pensions for small businesses delayed until 2017 (Guardian)

Those small business owners still grappling with this year’s tax return (we hope you’ve remembered today’s deadline) will be relieved to hear that the introduction of at least one administrative headache has been delayed for another 5 years. The auto enrolment scheme was set to bring up to 10m workers into pension schemes for the first time but the DWP have cited “exceptionally tough economic times” as reason for delaying the introduction of the programme – under which employees are automatically enrolled on their employers’ pension schemes – until 1st April 2017 for companies with fewer than 30 staff.

5. Facebook to offer free ads to small businesses (Sky)

A generous month for internet giants indeed, January also saw Facebook announce a £4.2m giveaway of ad credits to businesses in the UK, France, Germany, Spain and Italy. Individual buisnesses can get up to £83.16 each of free credits and there will also be free events run by Facebook and local Chambers of Commerce throughout the country explaining how to set up a business Facebook page and use it to engage customers. More sceptical heads might see this as a response to Google’s recent introduction of brand pages on their new social network Google+ which, if used shrewdly by businesses, can have a similar effect to advertising.

Those of a less cynical bent are just happy to get free stuff.


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