Business rate reform is back in the headlines – it must be Budget time soon! The usual calls for the usual changes are as loud as ever. But small firms are likely to be a little preoccupied this year – with finding a way to pay the bills. How can they afford it?

What do business rates and system reform mean to small firms?

The recent coverage of business rates reform, and the reaction to government proposals to ease the burden on small businesses, underlines how strongly these firms feels about the tax and how they view its impact on sector health and development potential.

Interestingly, the response to a new government report on business rates has been guardedly positive. The small business sector has largely welcomed the measures, in particular the pledge to remove “cliff edges”, in particular reducing the onus on firms wanting to open a second premises. That said, sweeping changes remains the message and anything less than substantial reform is likely to be met with indifference at best.

The Budget isn’t for a couple of months – later than usual – so no doubt there will be plenty more said about business rates reform, what it means and what it can achieve. The heightened focus highlights not only the heat around the issue, but the position that small businesses are in, and not only with regard to business rates.

The headwinds that have been battering small businesses – of which business rates is just one – simply aren’t dying down. Margins are being squeezed ever thinner by rising costs, flat market conditions and a soft economy. Balancing the safeguarding of cash flow with essential investment has rarely been more challenging. Which makes putting up with what is perceived as an unfair business rates system a very bitter pill to swallow.

How alternative finance can help with managing business rates

The talk of business rates reform is encouraging for small businesses, but what is more pressing is actually being able to pay the tax. Talk of change in the future is good, but the money is needed now. What’s the solution to protecting cash flow and paying bills for beleaguered businesses?

This is where alternative finance can help.

Small business lending from traditional sources remains subdued at the end of Q3, with almost 40% of firms finding accessing affordable finance one of their biggest challenges. Against this backdrop, services such as invoice finance, asset finance and peer-to-peer lending are proving a vital source of capital for small businesses in the current funding climate.

These alternative finance facilities, which offer a more easily accessible, affordable and personalised approach to lending, are helping small businesses survive and target recovery, stability and growth.

Notably, the Growth Guarantee Scheme is providing a wide range of finance facilities to smaller firms, including asset finance, invoice finance and asset-based lending. This is further proof that alternative lenders are increasing filling the small business funding gap.

Small firm finance options for affording business rates bills

Will small firms get the business rates reform lifeline that they’ve been lobbying so hard for? Confidence isn’t high – the last Budget was a hard one for the sector. Yet, the new proposals offer some hope. Regardless, the bills, including business rates, need to be paid and this requires balancing what is coming in with what is going out.

Access to finance is critical. This is why it is essential that key decision-makers are aware of all the finance options available to them, including the services of alternative lenders.

To find out more about A&T Business Associates services, contact Tony Hedger on 01903 602211 or tony.hedger@atbusinessassociates.co.uk.