Deadlines have a habit of sneaking up on us, and this autumn UK companies have a new one to contend with: in November 2017, they will need to submit reports on their payment practices due to the new UK legislation.
The legislation is part of the UK’s government’s effort to protect small businesses from the crippling effects of late or non-payment: Small and medium sized businesses were owed around £26.8 billion worth of late payments in June 2015, according to government figures.
In line with this, partnerships within the scope of the new rules will have to submit a report on their payment practices twice a year. Reports will be held on a central government website, allowing SMEs to research the payment records of the large clients they do business with.
Although this new regulation came into law at the beginning of the financial year, many companies are still uncertain about what the new requirements entail. Details such as who must report, what information they have to report and how they can ensure they are fully prepared for the deadline are causing mounting anxiety as the first deadline looms.
It’s easy to think of any new regulation as a burden – but in this case there are benefits, too.
For many companies, complex payments processes are merely a symptom of wider inefficiencies within in their financial operations. By obliging companies to start reporting on their payment practices, the UK government is encouraging them to get their payment practices in order and inject an efficiency into their processes that will deliver benefits beyond just compliance. In fact, it has to potential to bring increased transparency and fluidity across their whole financial operation.
If your business is looking to take advantage of the new legislation and turn it into a benefit rather than a negative then we can help.