These are two of the key findings from the latest survey by the Association of Practising Accountants (APA). The survey, which collated responses from 532 owner-managed businesses across the country, paints a picture of an industry under strain.

Paul Dickson CEO and managing partner of APA member firm Armstrong Watson says the report’s findings highlight the need for greater support for these businesses in such challenging times.

The report also found that more than half of the businesses surveyed said economic uncertainty had caused the most challenge to their business over the last 12 months.

Meanwhile, 53% said the increases to corporation tax will impede their ability to grow to some or a great extent.

Despite the challenges though, many SMEs remain resilient with 49% who feel their business is now in better shape than it was 12 months ago and 78% who report they could cope with further interest rate rises in the next 12 months.

Mr Dickson said: “Having navigated the challenges of Brexit and the Covid-19 pandemic, businesses are now faced with inflationary pressures, the cost of living crisis, increased tax rates, energy price volatility and economic uncertainty. This combination of challenges means that the pressure on many businesses is mounting.

“While it’s pleasing to see 23% of those who responded are prioritising business growth, others are still struggling and their priority is simply survival. The challenges faced by owner-managed businesses could be relieved with more Government support and it’s certainly something we’d welcome for our clients.”