Businesses with an annual income of under £79,000 are being urged to join the government’s most stripped down accounting scheme, which it says will save time and money.

The ‘cash basis’ scheme allows businesses to calculate the incomings and outgoings of their business and is based on profits only. It strips out complex adjustments meant for larger firms.

Unincorporated businesses are also being given the option of simplified expenses, using flat rates instead of calculating real expenses for vehicles and home-working costs.

Carol Lunney at HM Revenue and Customs said: “The cash basis and simplified expenses schemes can help save small businesses time and money. With a new tax year on the horizon, now is the time to start thinking about them.”