Henry the Taxman wants your money.
Yes, for those of you who thought last week’s post about flat rate VAT was boring, we had the budget this week. And you will no doubt seen a lot of commentary about his tax grabs on self employed and small businesses so I won’t add to that except to say that the Office of Budget Responsibility has calculated that the tax saving on incorporation is £3,300 when it’s more like £1,300 . Quite apart from the fact that Hammond is basing taxation policy on dodgy numbers, it shows that even so called “experts” can’t always get it right. I am forever seeing articles where only some of the variables have been considered and it does bug me. But then I am a numbers nerd.
In essence the present tax system seems to be based on taking a chunk of what’s there instead of encouraging people to earn and produce more wealth (leading to higher tax receipts along with less need for public spending). However you don’t need to make the same mistake. I have said it before; you can only take making savings (tax or otherwise) so far but the amount you can earn is (in theory) unlimited. Start by increasing your prices by 10%. If you do it right almost no one will notice and those who do probably won’t care. Indeed if you aren’t getting “price resistance” then you probably aren’t charging enough.
Yes there are always price buyers but do you want them? A small business can’t usually afford to pile it high and sell it cheap, so offer value to the customer and don’t apologise for your prices.
Especially don’t offer discounts (there are ways to appear to discount without actually doing so) and definitely don’t offer them before being asked.
Anyway have a great weekend, oh and the point of the title? I saw a Tortoiseshell butterfly yesterday; Spring is on it’s way and that should cheer just about anyone up. Even the taxman.
Paul