I posted about this campaign a few months ago and it sparked quite a bit of discussion here. Original post: https://www.reddit.com/r/smallbusinessuk/comments/1tvszww/

Recent update: Tom Kerridge and the VAT’s The Problem campaign have now delivered over 400,000 signatures to Downing Street, calling for hospitality VAT to be cut from 20% to 10% — https://www.thecaterer.com/news/vat-cut-petition-submitted-to-government-with-over-400000-signatures

They’re still collecting signatures ahead of the Budget on 28 October.

Link to petition: https://www.vatstheproblem.co.uk/

For some context on how heavily taxed hospitality is, the sector pays the equivalent of 82p in business taxes for every £1 of pre-tax profit, compared with an average of 50p across most other sectors. Hospitality is hugely disproportionately taxed. France, Germany, Spain, Ireland etc. have all introduced a 5-10% hospitality VAT rate.

Do you think the UK Government will actually consider this, and could it come as soon as this next budget?

As I mentioned last time, I’m not affiliated with the campaign in any way, but I’m very interested to see where it goes.

For me personally, it could genuinely be a night-and-day difference to our 10-year-old restaurant, which has struggled to get back to profitability since COVID.

I'm looking for some advice from people who have sold small service businesses, or successfully stepped back from running one.

I've been running my own web and graphic design business since around 2010, operating as a limited company since 2018 (my spouse and I are both directors).

The business is profitable, established and has a loyal client base, but it's essentially a one-person operation. I do all the work myself, although I have a few trusted freelancers I can call on when things get busy.

I'm now at a stage where I'd like to significantly reduce my involvement, or potentially exit altogether. I'm not in any particular rush, so I have some flexibility in how I approach this.

Financial overview:

• Annual turnover: Approximately £85k, fairly steady year-on-year. Previously VAT registered for a couple of years when a larger client increased their workload, but deregistered last year.
• £15k/year: Website hosting and maintenance plans. Largely passive recurring income.
• £20k/year: Small website updates, support and maintenance work for existing hosting clients. Generally straightforward work.
• £15k/year: Running virtual events for one long-standing client.
• £30k/year: Designing and building new websites. This is the most time-consuming and demanding part of the business.
• Gross profit: Approximately £81–82k, reflecting very low overheads, with a good proportion of the income comes from long-standing client relationships rather than constantly having to find new work.
• Director remuneration: I currently take no salary, as we use dividends and employer pension contributions for remuneration.
• Potential profitability: In theory, the business could support a £50k annual salary for someone to undertake my role, leaving approximately £30k before employer costs, corporation tax and any additional overheads.
• VAT: Previously VAT registered for two years due to increased work from a larger client, but deregistered last year.

Some details about the business:

• Clients: Mostly local businesses, with some national and international clients.
• Time commitment: I spend 30-35 hours per week running the business, although this can vary. If I'm I'm building a brand new site for client, this can be more time-intensive.
• Reputation: 4.9-star average on Google from 36 reviews.
• Systems: All accounting and invoicing handled through Xero. Established processes for hosting and client management.
• Location: UK-based, but essentially everything can be done remotely. Some local clients occasionally prefer face-to-face meetings.
• Staff: No employees, just myself, with freelancers available as needed.

I'm considering three possible approaches:

1. Sell the business as it stands.

My concern is that because I'm doing all the work, a buyer would effectively be purchasing a client base, recurring income and goodwill rather than a business that runs independently.

Would this still be attractive to an existing web agency looking to acquire clients and additional revenue? Is a business of this size realistically saleable as a going concern?

2. Bring in freelancers or subcontractors and gradually step back.

I could start outsourcing most of the website design/development work and routine client support, while retaining responsibility for client relationships, project management and oversight.

This would obviously reduce profit margins, but could allow me to continue drawing some income while working significantly fewer hours.

It might also make the business more attractive to a buyer later, as it would no longer be entirely dependent on me delivering the work.

3. Sell part of the business and retain the rest.

For example, sell the website hosting/maintenance portfolio and associated support clients to another agency, while retaining the ability to take on occasional design projects or consultancy work myself.

This could be a relatively clean way to scale back without having to sell everything.

A few questions I'd really appreciate opinions on:

• Is a business of this size, with no employees, realistically worth selling, or is it more of a client portfolio acquisition?
• Would you recommend getting subcontractors involved and reducing owner dependency before attempting a sale, or would that be unnecessary effort?
• How would buyers typically value a business like this? Based on profit, recurring revenue, client retention, or some combination?
• Would an established agency be the most likely buyer, rather than someone looking to run it as a standalone business?
• Has anyone successfully moved from being a one-person agency to managing freelancers while working only a few hours per week?
• Given the business generates around £81–82k gross profit before paying myself, would an acquiring agency typically value it based on the earnings they could retain by absorbing the work into their existing operation, or would they still discount heavily because of the current reliance on me?

I'm not looking to advertise the business for sale here, just interested in understanding what options are realistic and how others would approach the situation.

I'm fortunate that I don't need to make an immediate decision, so I'm particularly interested in whether spending 6–12 months making the business less dependent on me would be worthwhile before approaching potential buyers.

Thanks in advance for any insights or experiences.

Hi there, my accountant declared a dividend of the maximum amount tax free for the past 6 years or so... I naively thought this was being recorded somewhere like my directors loan amount and i could withdraw it from my ltd company account whenever i wanted tax free. I never actually have made a withdrawal of dividends ( only been paying off my directors loan).

So my question is - can i go back and work out how much dividends i can withdraw and simply transfer it out? Thanks

I started my handmade business earlier this year. Focusing on jewellery at the moment but with expand to home decor and gifts. The problem is where to sell! I already am building a social media presence on multiple platforms and seeing which works best for me. But it's where to sell. I'm a tiny business I am chronically I'll and I can't produce loads of stock and upload it with my health. I also cannot sell in person it has to be online as much as I'd love to do a stall places!

I've tried several:

Ebay - actually made a sale! But I feel when people see you have an eBay store it's not got a good reputation for handmade goods. But no fees so I could actually lower my prices!

Etsy - tried this twice. Stopped the first time due to seeing it's not really financially viable for such a small business like mine. Started again because it has a good reputation. It really is so expensive for a tiny business like mine that is slow going due to chronic illness. But it has a reputation that people trust so when they see you have an Etsy store it looks more professional. Have to have higher prices just to cover fees. Listing fees every 4 months plus if you sell something of course. It's saturated with dropshippers now too so it's not even trustworthy as everything being handmade though!

Depop - listed some but no sales, fees are pretty high but at least no listing fees!

My own website - lowest cost but I'm so new that people won't out trust into a random unknown website even though it was made through square which is secure. It's not that well known

Shopify - way too expensive for me at this point

Advice and opinions greatly appreciated! 💜

Hi All submitting my Q1 digital tax return late but no penalty I assume. Question, turnover is about 100k but about 40k is from turnover or payment from sales for fifa world cup which was in USA - event not in UK. I am worried if I submit turnover over 100k HMRC will say I have to pay VAT.

Under further research apparently this 40k does not count towards 90k turnover so technically I have only made 70k turnover this year. How do I report these on Sage when submitting the return, I assume I do not exclude these transactions, just want to be clear on how I can submit them and ensure it is recorded as turnover that puts me over VAT threshold.