== Banks still playing the game by their own rules ==


The government has been urged to clarify the levels of lending that banks are making to small businesses. The call came from the Forum of Private Business (FPB), which said more must be done to scrutinise the behaviour of banks through the Small Business Lending Monitoring Panel. The FPB’s survey showed that, for 94% of the businesses surveyed, terms and conditions of loans had not improved. On average, interest rates were 5.6% over the Bank of England base rate (which was at 1% during the survey period).

In total, 81% of respondents saw no change in the terms and conditions of overdrafts, with interest rates 5.8% above the base rate, on average. In addition, 24% reported increases in banking fees in March. Over the years many businesses had become used to their overdraft rate varying in line with the Bank of England base rate, and naturally expected the Bank’s widely-publicised cuts to bring their own rates down. Unfortunately the devil was in the detail of many overdraft arrangement schedules - yes, rates did vary with base rate, but often only within certain limits. So the typical small business is still being charged around 6% on its overdraft, even with base rates at their lowest in generations. If your overdraft is due for renewal in the near future, look very carefully at the small print - and haggle!



== Loss-makers’ tax relief should go further ==


Once-profitable businesses that are now suffering losses as a result of the recession were offered some relief in the Chancellor’s Budget. The carry-back scheme enables businesses to reclaim taxes on profits that have been made in the past three years by carrying back losses up to £50,000.

Originally announced in the pre-Budget report, the scheme has now been extended. It has been estimated, by the Treasury, that the measure could help some 140,000 smaller firms, each being able to claim an average of £4,000.

While welcoming the extension, one business group argued that the Chancellor should have gone further. The British Chambers of Commerce commented: "The extension to loss carry-back will help with smaller business cash-flow. But the Chancellor should have considered increasing the £50,000 carry-back limit to really make a difference."



== Company car changes ==


Despite years of tax increases, many forecourt operators still run the company car as both a business necessity and - let’s face it - a perk. Accountants have been trying to explain to clients for a long time that there aren’t really any tax benefits to running a company car, especially to those clients who still like to buy a new BMW or Merc every few years! The basic facts about company cars are:

? employees and directors pay tax on the provision of the car and on the provision of fuel by employers for private mileage;

? employers also pay Class 1A NICs at 12.8% on the same amount. This NIC charge is payable by the 19 July following the end of the tax year;

? the amount on which tax and Class 1A NICs is paid in respect of a company car depends on a number of factors. Essentially, the amount charged is calculated by multiplying the list price of the car, including most accessories, by a percentage. The percentage is set by reference to the rate at which the car emits carbon dioxide, according to officially determined rates.

In the Budget the taxable benefits were increased yet again. For full details, log onto www.ekwilliams.co.uk and select ’news’.



== VAT fuel scale charges ==


Of course, not every site operator has a car owned by their business. Many use their own personal vehicle and simply fill up at their own pumps, putting the fuel cost down as a business expense. That’s fine but in order to get round arguing with each individual about how much of that fuel is actually for business use, HMRC has a standard scale of "disallowable" VAT on the fuel. What this means is that generally at each VAT return a certain amount of input VAT on the fuel is disallowed - ie added back to increase your motor costs. The scale is based on the official CO2 emissions rating of your car, and was also increased in the Budget. We find that telling people what the quarterly cost is often doesn’t really hit home, whereas seeing the annual figure in black and white does tend to make them think twice. To check out the revised figures, which came into effect on May 1, logo onto www.ekwilliams.co.uk and select ’news’.



== Is your business fully insured? ==


Although most business people understand the need for insurance, a surprising number of businesses are uninsured, under-insured, or insured with out-of-date policies. Compared to many other businesses, petrol stations do carry additional risk elements. Some of the more common types of insurance risk are:

? public liability - claims for damages to third parties. For example, a fire might start on your premises and spread to your neighbours’ premises. Losses here might include profits or records;

? personal injury - the highest awards presently being made are in respect of third-party claims for personal injury. An award of over £1m was made recently to a customer who tripped over a piece of flex left trailing across the floor;

? employers’ liability - acts performed by your employees or subcontractors;

? Product liability - injury or damage caused by the failure of your product. The Consumer Protection Act has placed a greater onus on anyone dealing directly with the public. Proof of negligence is no longer required; the fact that a product causes injury places the blame on the supplier.

Experts advise that your planning should centre on insuring for a catastrophe. You should therefore check that your insurance for fire, loss of profits, employers’ liability, public liability and product liability is correctly arranged with suitable sums insured or indemnity limits. And don’t assume that your existing insurers will continue to offer you the best value; shop around!