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London, 13 February 2008: Small businesses are being urged to sign an online petition calling on the Prime Minister to abandon plans for a new tax that would have a disastrous impact on family businesses throughout the UK.

The Government’s proposals on what it calls “income shifting” will target all jointly-owned businesses, and family businesses in particular: if profits are not shared out in what the tax man sees as a “commercial” way, there could be a heavy tax penalty to pay.

Businesses will have to keep extensive records of every contribution to a business, and calculate how much it is worth – whether it is work, capital or ideas. They will then have to justify the distribution of profits to family members or other joint owners if the tax man investigates them: these investigations will be lengthy, stressful and expensive.

“The proposals create a sort of nightmarish reverse national lottery,” commented John Brazier, managing director of the Professional Contractors Group (PCG). “Everyone will be forced to buy a ticket, and if your unlucky number comes up you could face a mauling from HMRC and a hefty tax bill at the end of it.

“Even if you are not clobbered by a tax investigation, you will still have to jump through all the hoops and keep all the records – most of them totally unnecessary for running a family business.”

PCG, which represents the UK’s freelancers, set up the online petition in December: It has also set up a dedicated campaign website, at

For further information:

Michele Bayliss
Tel: 01273 475672
Mobile: 0777 937 2106

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