UK tax system costs businesses £10bn a year

UK tax system New research by AAT this year has revealed that it costs businesses £10bn to comply with the UK tax regime. But small and medium businesses shoulder the greater part of the burden. The AAT survey of 500 businesses, uncovered that SMEs spend around £9.9bn each year on tax compliance compared to £100m paid by larger firms.

When it comes to your own business we offer taxation advice and practical, cost-effective help. Just call 01438 869 644 or email

Small and medium enterprise tax compliance

Whilst SMEs may (by definition) have up to 250,000 staff, the average number of employees is actually just up to four people. Despite this micro scale SMEs pay a disproportionately high amount to comply with the tax regime and this work also takes proportionately longer compared to big businesses.

  • average 4 staff
  • £4,376 on average in tax compliance costs
  • 2 hours per week spent on tax compliance

Large businesses tax compliance

Although they employ over 250,000 people and often a great many more, the compliance costs for large businesses are proportionately lower.

  • 250,000+ staff
  • £8,900 on average in tax compliance costs
  • 6 hours per week spent on tax compliance

Tax is too complex and time-consuming

SMEs believe that the tax system is overly complex.

  • 70% say far too much time is needed to handle tax issues.
  • 70% think that the UK tax system is too complicated.

The areas of tax which AAT members believe are most in need of simplification to help UK businesses are:

  • Tax relief
  • Capital gains
  • VAT
  • Corporation tax
  • Income tax.

Ease the compliance burden

Chartered Accountants Tarrant Green & Company can advise on a host of tax issues and help clients to comply with their tax obligations, shouldering some of the tax compliance burden. This includes:

  • Advice on tax planning for individuals, partnerships and limited companies
  • Preparation & filing of Personal Tax Returns
  • Preparation and filing of Company Tax Returns

If you’d like any help then do get in touch on 01438 869 644 or email