SMALL businesses stand to reap major benefits from changes to company law, according to national accountancy group Hacker Young.

The Company Law Review Steering Group has now issued its final report containing recommendations to simplify and modernise UK company law and accounting procedure -- and Mike Wasinski from Hacker Young's Manchester office says that, to a certain extent, they have achieved this.

"These proposals are to be welcomed, especially by small businesses. Most companies in the UK, especially small businesses, are strangled by red tape and other accounting complications.

"The proposals go some way to relieving the pressure of the administrative and reporting side of business that many owners find so frustrating," he said.

"It is now up to the Government to draft legislation based on the findings of the report as soon as possible, so that the benefits can be seen and more people are encouraged to start up new businesses."

The points of the report most welcomed so far are an increase in the small company threshold to the maximum available under European law to make things simpler for more businesses.

To be classed as a small company, two of the following criteria must be met: turnover no more than £4.8 million, balance sheet no more than £2.4 million or having no more than 50 employees.

If the proposals are accepted by the Government, then legislation will follow via the new Companies Bill.