A third of small businesses across Europe are planning to expand this year, according to new data released by Hisox.

The second ‘DNA of an Entrepreneur' study of almost 1,000 small business owners in the UK, Germany, France and the Netherlands, also found that one in ten of those polled are very optimistic about the year ahead.

The survey also highlighted some discrepancies between small business owners in Europe, with less than one in ten (8%) bosses in Germany accept the need to take a gamble when running their business compared to 38% in France and 29% in the Netherlands and the UK.

It also revealed that for nurturing future business talent the UK topped the poll – a third (31%) of UK SMEs say our education system encourages individual ideas and dreams, compared to just 19% in Germany.

However, despite growing optimism, 20% of small and medium-sized businesses bosses are concerned that there is not enough support for emerging businesses and 65% believe that government bureaucracy is threatening their country's entrepreneurial sprit. Four major barriers for starting a business were identified:

• Unfavourable taxation system
• Inflexible labour laws
• Burden of benefits and social security payments
• Lack of support from government

"The SME sector is a strong bellwether for the rest of the economy so it's a great sign that Europe's entrepreneurs believe they are now in a sound financial position and well placed for growth in the second half of 2010, despite being more risk averse," said Alan Thomas, small business expert at Hiscox.

"Small businesses cannot lead the charge alone. The tough economic climate of the last two years has left many in a delicate position so it's vital that the right support is provided to breakdown any barriers threatening Europe's future entrepreneurial success."