Customs and Excise has produced evidence showing that only 25 per cent of firms in this area have taken advantage of the Flat Rate Scheme. This is a special allowance for companies with a turnover of up to £150,000 to calculate their VAT payment as a percentage of their total turnover rather than calculating it on each individual purchase and sale.
According to the agency, over 25,000 architects and surveyors could be eligible to sign up and yet the vast majority are failing to take advantage.
Roger Halson, Customs and Excise's small business champion, warned that the lack of take-up was damaging the economy.
`Small businesses are the engine room of our economy,' he said. 'Anything we can do to help them focus on the core task of running their business has to be a good thing.
'While a certain amount of paperwork is inevitable for any small business owner, it is important that it is kept to a minimum.
'If we can provide shortcuts to cut down on paperwork and tasks such as 'doing the books', such as the Flat Rate Scheme, which has proven to save time and hassle for small business owners, then it is a win-win situation for all involved,' Halson added.