Among all the UK’s regions, Yorkshire and the Humber are leading the way in the amounts of R&D Tax Relief claimed. The area saw an impressive growth rate of 23.7%, as per new Government statistics analysed by software provider, Ryan.

Surge in Yorkshire’s Innovation Spending

R&D expenses, considered to be a high return investment, rose from £1.56 billion in the 2020/21 fiscal year to an astounding £1.93 billion in 2021/22. This expansion highlights a promising trend in the region and indicates bright prospects for innovation, market competition, and economic growth.

HMRC Data and Tax Relief for R&D

This was gleaned from HM Revenue and Customs (HMRC), which monitors claims made for R&D tax relief, a system that rewards businesses that qualify with innovation. This tax relief was first introduced in 2000 as a way to incentivise and reward creative thinking in pursuit of scientific or technological advances. It results in either a reduction in corporation tax bills or provides a lump sum payout for companies that successfully resolve a scientific or technological uncertainty.

The number of tax relief claims in this area is also on an upwards trend. Yorkshire businesses recorded a 6% rise in R&D project tax relief claims, totalling to 6,805 claims. Yorkshire and the Humber businesses took advantage of £370 million in R&D tax relief, averaging £54,371 per claim.

Nationwide Innovation Spending in Context

While the R&D spending trends are looking optimistic in Yorkshire and the Humber, the entire UK reflected positive progress as well. The nationwide innovation spend by companies stood at £44.1bn for the fiscal year of 2021/22, showcasing an 8% rise; however, there’s a decreasing trend of first-time claimants for two years in a row.

Impact of R&D on Economy

Research and development ventures are not confined to mere academic experiments. Instead, they introduce new products and services to the market, driving a significant part of economic growth. Effectively, these projects increase foreign investment and boost exports, which leads to job creation, especially higher-skilled positions

Nigel Holmes, Director, Research and Development at Ryan, encapsulated the situation: “Yorkshire and the Humber’s R&D spend is a huge success story, growing faster than any other region. Equally promising is the surge in businesses making claims for R&D tax relief, increasing at a faster rate than nearly all other parts of the country. This innovation spending will be a tremendous boon to the region, as it helps to drive economic growth, job creation, and attract more inward investment.”

Financial matters often seem complex and unapproachable, but understanding how they affect us and our economy is crucial. This review summarises key points drawn from the latest UK Corporation Tax statistics, digesting the numbers into simple everyday language.

A Look Inside: About The Report

The annual publication showcases data from various Corporation Taxes collected over the financial years, shedding light on the economy’s health and the different contributors. Corporation Taxes covers several subcategories:

• Corporation Tax, encompassing both onshore and offshore
• Bank Surcharge
• Bank Levy
• Residential Property Developer Tax (RPDT)
• Energy Profits Levy (EPL)

The current release runs up until the financial year ending in March 2023 and also shares initial Corporation Tax liability estimates for company accounting periods ending between April 2021 to March 2022. Eye-catchingly, it’s the first time that Corporation Tax receipts have been classified by Standard Industrial Classification (SIC) of economic activity.

A Year of Increase: Headline Findings

From a broad perspective, the increase in total Corporation Tax receipts by £17.3 billion (a growth of 26% from the previous year) marks an uplifting trend for the 2022-2023 financial year.

Banking was the largest contributor sector, with Financial and Insurance receipts (including Bank Levy and Bank Surcharge) accounting for £18.4 billion or 22% of all Corporation Taxes.

Further, the 25% growth in Corporation Tax liabilities to a total of £12.9 billion can mostly be attributed to a sharp upturn in trading profits, as opposed to decrease in deductions or losses.

In particular, 2021-2022 saw a 20% hike in capital allowances claims owing to the introduction of the super-deduction policy, contributing over £30 billion (26% of the total). Lastly, an interesting statistic shows that just a sliver of companies (about 5,400 or 0.4%) accounted for 56% of total Corporation Tax liabilities, totalling an impressive £36.4 billion.

Dissecting the Trends: Corporation Tax Receipts

Over the years, trends have fluctuated for a variety of reasons:

• Corporation Tax receipts for 2022 to 2023 amount to £84.7 billion, up by £17.3 billion (26%) from the previous year. This significant increase largely resulted from a strong economic recovery post-pandemic, considerable growth in offshore receipts, and the implementation of the Energy Profits Levy (EPL).
• The 2019 to 2020 period saw earnings increase partly due to a roll-out of new payment timings for larger companies, resulting in earlier payments.
• Onshore Corporation Tax receipts for 2022 to 2023 stand at £71.4 billion, up from last year’s by £9.9 billion (16%).
• Offshore Corporation Tax receipts witnessed a closer to three-fold increase of £4.6 billion (230%) compared to the previous year, aligning with the soaring prices of oil and gas which in turn invertedly related to energy companies’ profits.
• The Residential Property Developer Tax and Energy Profits Levy, both unveiled in the 2022 to 2023 financial year, gathered £0.2 billion and £2.6 billion respectively.

Industry-wise Breakdown: Receipts by Economic Activity

Every sector plays a unique role in driving the economy:

• Financial and Insurance remained the top contributor with £18.4 billion or 22% of total receipts, showing a 7% elevation since last year.
• The Mining and Quarrying sector ranked next, contributing £10.6 billion.
• The Wholesale and Retail Trade sector stood third, donating £8.7 billion or 10%, with an encouraging 11% increase over the last fiscal year.

Post-Pandemic Progress: Corporation Tax Liabilities

The 2021-2022 financial year saw a 25% swell in Corporation Tax liabilities from £51.5 billion to £64.5 billion, significantly more than pre-COVID-19 levels. This massive jump can be attributed to the post-pandemic recovery where businesses reported heightened trading profits.

The Super-Deduction Effect: Capital Allowances

Capital allowances are tax benefits for businesses that let a company subtract the value of an item from its profits.

In 2021-2022, the innovative ‘super-deduction’ policy was enforced. The super-deduction allows a generous 130% rate in the first year of an investment. This contributed to a significant increase in total capital allowances claims for 2021-2022. It is important to note that the figures for 2021-2022 represent a partial year of super-deduction data due to the policy’s introduction time.

Closing Thoughts: The Bigger Picture

Ultimately, these statistics symbolise the recovery and growth of our economy, an encouraging sign for UK citizens. As we continue to bounce back from the aftermath of the pandemic, understanding these circumstances adds greater depth to the conversations around our economic fortitude.

Accountants and financial advisers play a crucial role in helping businesses manage their finances, and they’re ringing alarm bells. According to a study by Premium Credit, a major finance provider for companies, these experts are observing a growing trend of businesses struggling to meet their tax obligations.

Out of those surveyed:

• 98% have noted an increase in clients having difficulty paying tax bills in the last year.
• Alarmingly, 43% of these professionals report a dramatic increase.

Spotlight on Specific Taxes

Not all tax bills are created equal. When the financial professionals were quizzed about which tax bills their clients found most challenging:

• Corporation tax stood out, with 71% noting a spike in businesses finding it hard to pay.
• Income tax followed, with 53% observing more clients grappling with it.
• VAT was another pain point, with 37% seeing a rise in clients battling to settle these bills.

Why Are Businesses Struggling?

Several factors are at play:

1. Economic Challenges: 55% of accountants and advisers cite the economy’s impact on companies as a top reason for these payment issues.
2. Personal Issues: Personal life events like divorces were highlighted by 53%.
3. Cost of Living Crisis: 47% pointed out the escalating cost of living as a significant factor.

Worrying Forecasts

It’s not just about the present. Financial experts foresee the situation worsening:

• They estimate that currently, 11% of their clients are struggling with tax bills. However, this number is projected to rise to 14% in a year’s time.
• Nearly half predict that 15% or more of their clients will grapple with tax payment challenges in the coming year.

These are not small sums. The average tax bill causing strain? Around £100,000. Furthermore, 10% of financial professionals revealed that some clients face difficulties with staggering tax bills of £200,000 or more.

Consequences of Missing Tax Payments

The implications for not meeting tax obligations can be hefty:

• A delay in corporation tax payment by just a day can lead to a £100 penalty.
• Missing VAT payment timelines can cost businesses as much as 15% of the unpaid VAT amount, although these fines only kick in after a 15-day delay.

Expert Insights

Jennie Hill, Chief Commercial Officer at Premium Credit, sheds light on the situation, remarking, “Accountants and financial advisers are good judges of the health of small businesses, and they’re signaling increasing distress.” She emphasises the gravity of the situation when firms struggle with average bills of £100,000, pointing out the urgent need for solutions to aid companies in fulfilling their duties while maintaining effective operations.

Conclusion: The Road Ahead

As the economic landscape continues to shift, the strain on businesses to manage their financial obligations is clear. It underscores the need for supportive measures and solutions, ensuring that UK businesses can weather these challenges and thrive in the future.

The taxman has been on a mission. Their target? Big multinational businesses. In particular, those that might be moving their profits overseas to reduce their UK tax bill. To give this some context, imagine you own a business that operates both in the UK and another country with lower tax rates. It might be tempting to ‘move’ your profits to the country where you’d pay less tax. This is what HMRC is trying to clamp down on.

In their arsenal is a tool called the ‘Profit Diversion Compliance Facility’. Launched in 2019, this initiative encourages multinationals to come forward if they’ve used tactics to divert their profits overseas. If they own up and work with HMRC, they might get more favourable penalty rates. Think of it as a chance for these businesses to make amends.

Why is This Such a Big Deal?

There are special tax rules about the pricing of goods and services between different parts of a multinational business. This is known as ‘transfer pricing’. If not handled properly, transfer pricing can lead to profits being wrongly reported in different countries.

In some cases, businesses try to use these rules to reduce their UK tax bill. How? By creating setups that have little to no genuine business activity (often just on paper) or by making it seem like they don’t have a taxable presence in the UK.

But HMRC’s not having any of it. They’ve got a higher tax rate (currently 31%) called the ‘diverted profits tax’. This is charged when they find evidence of such tactics.

The Results So Far

The numbers are telling a positive story for HMRC. They’ve collected over £70 million in the year up to March 2023. That’s a 3% jump from the £68 million they got in 2021-22 and a whopping 79% increase from the £39 million in 2020-21.

Sam Wardleworth, a tax expert, highlights that this approach by HMRC is working. Rather than enduring a long, costly tax investigation, many businesses are choosing to come forward and settle. Wait too long, and HMRC’s penalties can skyrocket. Proactivity, it seems, saves money and hassle.

However, for those who don’t come forward? HMRC’s ramping up its investigations. They’ve opened 147 new investigations in the last year, which is an 18% increase from the year before and 40% more than two years ago.

Looking Ahead

The world of tax, especially for big businesses, is complex. There are ongoing discussions about integrating the diverted profits tax into the regular corporation tax. New developments like the ‘multinational top-up tax’ are also being introduced. These all aim to ensure multinationals pay their due.

Wardleworth’s advice for businesses? Stay proactive. Identify and fix potential issues as they arise, rather than waiting for the taxman to come knocking.

In conclusion, it’s a delicate balancing act for HMRC. They need to collect the tax that’s due while ensuring businesses can thrive. This drive against profit diversion is a clear sign they’re committed to getting what’s rightfully owed, ensuring a fair playing field for all.

Big business is the lifeblood of many thriving economies, and the UK is no exception. But what role does corporation tax play in this? Recently, the former Prime Minister, Liz Truss, made headlines with her take on the matter.

Liz Truss’s Tax Stance

Liz Truss, a significant player in the UK’s political landscape, has recently advocated for the reduction of corporation tax to below 19%. The main idea behind her statement? Making the UK a more desirable hub for substantial business operations.

Truss expressed concerns over the current rate, standing at 25%, which she feels might be off-putting for potential businesses. She said, “We want to attract big businesses and we’re now having to give businesses subsidies to come to Britain, whether it’s Tata [Steel] or other companies, because the level of taxes are too high. So we need to reduce the level of corporation tax.”

Past Promises and Present Reality

While serving in No10, Ms. Truss had expressed her commitment to preventing tax hikes. She had initially opposed the former chancellor Rishi Sunak’s intent to increase the tax from 19% to 25%. However, when faced with market uncertainties following her mini-Budget, she made a surprising U-turn.

Later, when Sunak himself ascended to the role of Prime Minister, he implemented the previously proposed tax increase, resulting in the current 25% rate.

Making Britain Competitive Again

In her discussion with the Telegraph’s Planet Normal podcast, Truss reiterated her belief in the UK’s potential as a business hub. She emphasised the need for not just attractive tax rates, but also a streamlined planning system.

“We need to make our planning system much easier,” she argued, highlighting the slow processes that currently bog down prospective businesses.

Comparing the UK with other countries, she pointed out the hassle for companies looking to establish new factories. She argued that if a business had to choose between waiting two years in the UK and getting started immediately elsewhere, the latter would always be more appealing.

Reflecting on her Tenure

Ms. Truss’s time as Prime Minister, albeit brief, was certainly eventful. After her tax cut proposals, the UK saw the pound’s value drop dramatically, prompting the Bank of England to intervene.

However, in her conversation with Planet Normal, she defended her decisions, suggesting that her mini-Budget was unfairly blamed for issues that had been developing for a while. She refuted claims that her leadership led to an economic downturn, stating that many of the negative economic signs were not “unique” to her term.

Concluding Thoughts

Taxation, especially when it concerns big businesses, is always a matter of heated debate. The balance between attracting business and ensuring fiscal responsibility is delicate. Whether Ms. Truss’s suggestions will gain traction remains to be seen, but one thing is clear: the conversation about the UK’s economic future is far from over.

For many of us, Facebook is a daily constant, serving as a space for connecting with distant family and friends, finding intriguing articles, and keeping up-to-date with the latest trends. Facebook’s immense reach extends to businesses as well, supporting countless UK enterprises in the promotion and sale of products. Yet, a heated controversy has emerged over Facebook’s tax payments in the UK. An article on Robots.net attempts to demystify this contentious issue, delve into the intricacies involved, and present a balanced viewpoint for the average UK citizen.

Spotlight on Facebook’s Tax Payment; Why Should You Care?

The public scrutiny over Facebook’s UK tax payments began when it was highlighted that a company of Facebook’s stature seemed to pay a significantly lesser tax compared to its vast profit margin. Before we delve further into the specifics, it’s important to clarify what’s meant by ‘corporate tax’.

Simply put, corporate tax is the tax levied on a business’s profits by the government. Its rate can differ based on different legal parameters but is essential for any country’s revenue. This income aids in funding numerous public services and helps in the infrastructural development of the country.

The focus is on business giants like Facebook because there’s a perception that such corporations use legal yet questionable means to minimize their tax payments. This forms the crux of the controversy, the widespread belief that big corporations exploit tax loopholes, depriving governments of substantial revenue.

The Context of Facebook in the UK

Facebook holds a significant position in the UK’s virtual environment, forming the core of millions of citizens’ social networking activity. The platform’s offices around the country, including its London headquarters, provide job opportunities and contribute to the local economy.

Over the years, Facebook has seamlessly integrated into our daily lives, transforming communications and information sharing. Its effectiveness as a marketing tool has played a pivotal role for UK businesses, allowing targeted advertising and an effective reach to specific demographics.

Yet, Facebook’s tax payments seem to overshadow these positive contributions. To properly comprehend this tax debate and its implications, let’s delve deeper into the essentials of corporate tax and the specifics of Facebook’s tax payments in the UK.

Digging Deeper into Corporate Tax

Corporate tax, a critical aspect of any country’s tax system, is levied on the profits earned by businesses. It’s an important revenue source for governments, contributing significantly to funding public services and infrastructure development.

Global multinational corporations like Facebook adhere to individual countries’ tax laws. However, they face criticism for their tax practices, particularly for the utilization of ‘tax avoidance’ techniques. These legal practices aim to minimize tax obligations by exploiting discrepancies in tax rules across different countries. Some believe this practice deprives the government of substantial tax revenue, leading to the current debate.

Now let’s examine the specific case of Facebook to better understand the controversy.

Facebook and Its UK Tax Payment Saga

Critics argue that the social media giant’s tax payments in the UK are disproportionately low compared to its considerable earnings. In 2018, Facebook reported UK revenues of £1.65 billion, while tax paid amounted to only £28.5 million. This discrepancy led to public cynicism regarding Facebook’s tax practice and allegations of tax avoidance.

Facebook, however, maintains that its tax payments comply with all applicable laws and regulations. Facebook justifies its relatively low UK tax payment by stating that UK operations primarily provide support services to its Irish headquarters, where the company’s European operations are based for tax reasons.

It’s important to note that Facebook isn’t the only multinational corporation in this glare of tax spotlight. Numerous tech giants have faced similar tax-related controversies, raising calls for a worldwide tax system reform.

Governments Take a Stand

In response to these controversies, the UK government introduced the Diverted Profits Tax in 2015. Commonly known as the “Google Tax”, it intends to discourage profit shifting to low-tax jurisdictions and ensure corporations contribute their fair share to the UK tax revenue.

The UK government has also cooperated internationally to tackle tax avoidance, participating in initiatives like the Base Erosion and Profit Shifting project led by the Organisation for Economic Co-operation and Development (OECD).

Despite these efforts, critics opine that stricter regulations, stronger enforcement, and higher penalties for aggressive tax planning are the need of the hour.

Public Opinion Divides

Public opinion on Facebook’s tax payments remains divided. Critics argue the company should contribute more, given its substantial UK earnings and its use of the market and infrastructure.

Opposing voices assert that the responsibility lies with governments to create a fairer tax system. Supporters argue that Facebook contributes more than just taxes, creating employment opportunities and facilitating business growth and digital innovation in the UK.

Recognising public sentiment is crucial in shaping the direction of ongoing discussions and potential reforms towards a fairer corporate tax system.

Wrapping It Up

Overall, the intricacies surrounding Facebook’s tax payments in the UK point to a broader issue. While Facebook has certainly reaped big benefits from the UK market, the question remains: is it paying its due share in taxes?

The controversy has highlighted the need for nationwide reforms, stringent regulations, and an overhaul in the global approach to devise an equitable corporate tax system. The debate continues, but the consensus is clear – multinational companies, regardless of their size and influence, need to contribute their fair part in the countries they operate.

In Northern Ireland, businesses face a unique challenge. Compared to their counterparts in Ireland, who benefit from a favourable 12.5% corporation tax rate, Northern Ireland’s companies are faced with heftier tax bills, sometimes twice as much. This discrepancy is one of the reasons why Chartered Accountants Ireland, representing over 5,000 members in the region, is raising its voice.

For context, the Northern Ireland Executive, which should be addressing these disparities, is currently non-functional. This has stymied the potential of many companies to take advantage of the unique opportunities the region offers.

The Northern Ireland Investment Summit

This week, Northern Ireland hosted an investment summit, showcasing its best attributes to prospective investors and global business leaders. Janette Burns, chair of the Northern Ireland Tax Committee of Chartered Accountants Ireland, highlighted this as an excellent platform to demonstrate Northern Ireland’s prowess, especially in the innovation and technology sectors. However, she also pointed out the elephant in the room: the region’s high corporation tax.

Burns mentions, “Many companies in the region are seeing a substantial decrease in their cash flow due to a near 32% increase in corporation tax bills.” This, when combined with inflation, results in much lower after-tax profits. The outcome? Reduced funds to reinvest in the company, reward employees, or create new jobs.

The Vision for A New Tax Rate

The idea of aligning Northern Ireland’s corporate tax rate with Ireland’s is not new. Experts argue that a 12.5% rate would provide the businesses in Northern Ireland with a competitive advantage. This would be particularly appealing for foreign investments, and local businesses would thrive too.

“The benefits of reducing the rate, and the measures required to make it happen, are well-established,” says Burns. She emphasizes the necessity of the Northern Ireland Executive’s reinstatement to address not only this but several other pressing concerns spanning education, healthcare, economy, and childcare.

Paul Millar, chairman of Chartered Accountants Ulster Society, chimed in on the issue. He reminded that the Investment Summit underscores the importance of a lowered corporation tax rate in enhancing Northern Ireland’s appeal as an investment destination. Millar said, “There have been whispers from political circles about possibly reducing the tax rate. But so far, it’s been all talk and no action. This isn’t aiding businesses struggling to manage their tax liabilities.”

The Road Ahead

Despite the numerous crises Northern Ireland companies have faced in recent years, they have shown remarkable adaptability and resilience. Millar stresses that these companies should now be equipped to prosper. He believes that as inflation starts to diminish, it’s time for politicians to take action.

His concluding thoughts were an appeal to political parties to come together: “We urge our political factions to move beyond their individual agendas and collaborate for the welfare of the entire region and its people.”

The rumble of an upcoming general election is something every UK citizen feels, but for small business owners, the stakes are even higher. The future direction of the nation’s economy and the policies that will shape the business landscape hang in the balance. Let’s peel back the layers of political speak, polls, and possibilities to understand what’s on the horizon.

When Might We Vote Next?

Every few years, the political atmosphere in the UK charges up as we anticipate a general election. The last significant electoral showdown was on 12 December 2019. Fast forward, and the upcoming general election is slated for no later than January 2025, based on the rules that dictate an election must be held 25 working days after the government is dissolved on 17 December 2024.

However, like unpredictable UK weather, general elections can sometimes come as a surprise. Just look back at 2017 when former Prime Minister Theresa May called a snap election two years ahead of schedule. As of now, whispers in the political corridors suggest spring and autumn of 2024 as potential dates for the next showdown. Some senior Conservative MPs believe that spring 2024 could be an “economic sweet spot,” hoping that the challenges of inflation and the cost of living would have subdued by then. On the other hand, Prime Minister Rishi Sunak reportedly leans towards November 2024, seeking maximum recovery time for the economy.

The Current Political Landscape

If you’re curious about which way the wind is blowing, YouGov’s polls provide some insights:

• Conservatives: 24%
• Labour: 44%
• Liberal Democrats: 9%

While polls don’t have a crystal ball, they paint a picture of the current mood. Given the numbers, the battle between Conservatives and Labour seems inevitable. But what could their victory mean for the small businesses of the UK?

Conservatives: The Current Approach and Future Implications

With the Conservatives in power, their recent decisions provide hints about the future. Their Spring Budget introduced some noteworthy changes:

1. The income tax threshold reduced from £150,000 to £125,140, taxing earnings above this at 45%.
2. The personal allowance of £12,570 has been frozen until 2028.
3. Tax-free dividends have been slashed from £2,000 to £1,000, with further reductions planned for 2025.
4. The tax-free allowance for capital gains tax saw a significant decrease from £12,300 to £6,000.

These decisions suggest a limited possibility of substantial tax relief for businesses if the Conservatives retain power. However, the party is banking on investment as their support pillar for businesses. One of the crown jewels of their strategy is the “investment zones.” Local leaders will have the reigns to stimulate business growth in eight key locations across England, each equipped with £80m to bolster skills, infrastructure, and business rates.

Furthermore, they’re promoting tax-free childcare for business owners and the self-employed. The aim? Helping business owners balance their entrepreneurial journey with family life. Lastly, with an ambitious goal to transform the UK into a global tech hub, they’re planning to funnel £75 billion into tech startups, tapping into major pension funds to support this vision.

Labour’s Vision for Small Businesses

Labour’s motto, “Making Britain the best place to start and grow a business,” is promising, but the actual details remain under wraps. Here’s a sneak peek into their strategy based on their recent announcements:

1. Tackling the Late Payment Crisis: With a jaw-dropping £32.1 billion owed to small businesses in late payments, Labour is gearing up to introduce stringent laws to combat this issue. They’re proposing that large businesses disclose their payment practices in annual reports, keeping them accountable.
2. Business Rate Revisions: Labour is considering cutting business rates for SMEs. The plan? Taxing the digital tech giants more to subsidise these reductions, potentially saving the average pub or restaurant a handsome £2,600.
3. Sustainable Business Operations: With the energy crisis biting into the pockets of SMEs, Labour aims to make businesses more energy efficient. They’re exploring a voucher scheme for businesses to adopt eco-friendly solutions like electric vehicles or insulation. This scheme would be funded by taxing oil and gas companies.

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In conclusion, the upcoming general election, be it in spring, autumn, or later, will have significant implications for the UK’s business environment. Whether you lean left, right, or centre, it’s vital to understand the potential outcomes and navigate the future with informed decisions. So, while we await the final manifestos, keep an ear to the ground, and a keen eye on the evolving political landscape.

Bosses of leading UK retailers, including Tesco, Marks & Spencer, and B&Q, have written a letter to Chancellor Jeremy Hunt, calling for a freeze on their property taxes. They are seeking to avoid a potential £400 million increase in business rates that could threaten the viability of many shops and hinder the industry’s investment capacity.

A group of 44 retail leaders have joined forces to coordinate this effort through the British Retail Consortium (BRC), a trade association representing the industry. In the letter, they argue that a rise in business rates would have a detrimental impact on their businesses.

The Concerns and Impact of a Business Rates Hike

The proposed increase in business rates is due to take place in April 2024 and is tied to the inflation figure for September, which will be announced in October. Currently, this figure is forecasted at around 6%. If implemented, it would result in more than £400 million in additional annual costs for retailers.

The BRC warns that such a significant increase would create an added burden on retailers, putting pressure on pricing in stores. Furthermore, it could potentially jeopardize the Chancellor and Prime Minister’s pledge to halve inflation this year.

The letter emphasizes that the retail industry is already grappling with several challenges, including global supply chain issues. Factors such as Russia’s withdrawal from the Black Sea Grain Initiative, targeting of Ukrainian grain silos, restrictions on Indian rice exports, and ongoing labor market challenges are already increasing costs for retailers. In light of these challenges, the signatories of the letter argue that freezing the business rates multiplier at its current level would help avoid exacerbating the situation.

The Need for a Freeze on Business Rates

The letter from the retail leaders urges the Chancellor to consider freezing business rates, highlighting the unique nature of this tax. Unlike other business taxes such as corporation tax and VAT, business rates must be paid regardless of whether a firm is making a profit or a loss. This places a significant burden on retailers, as the cost remains fixed even during challenging economic times.

Helen Dickinson, Chief Executive of the BRC, underscores the importance of freezing business rates to alleviate the high costs already faced by retailers. She argues that with shop price inflation gradually decreasing over the past three months, it is crucial for the government not to add to the cost burden and undermine this progress.

Additionally, Dickinson points out that a £400 million increase in business rates would have severe consequences. It would lead to job losses, harm the economy, and diminish the vibrancy of town and city centers. She stresses that this rise in business rates could force retailers to close existing stores instead of opening new ones.

Conclusion

The call from UK retail leaders to freeze business rates aims to secure the industry’s future by preventing an upcoming £400 million increase in property taxes. They argue that such an increase would threaten many shops and hinder the industry’s capacity to invest. With the challenges already posed by global supply chain issues and other costs, freezing business rates is seen as a crucial step to support retailers and maintain stable pricing for consumers. The decision will ultimately lie with Chancellor Jeremy Hunt, who will need to consider the implications this increase would have on the retail sector, jobs, and the overall economy.

The government’s website has a suggestion / warning that it might be wise to submit company accounts early.

Running a company comes with many responsibilities, and one of them is filing annual accounts on time. Failure to do so can have serious consequences, including penalties, a negative impact on your credit score, and limited access to finance. To avoid these issues, it is crucial for companies to file their accounts early. In this article, we will discuss the importance of timely filing, the available methods for filing, and how to avoid rejections.

Avoid Penalties

Filing annual accounts on time is a crucial responsibility for directors of all limited companies, including dormant companies. It is important to understand the implications of late filing, as it can affect your company’s reputation and its ability to conduct business. Late filing can also result in financial penalties, and in extreme cases, directors may face criminal records, fines, or disqualification.

Even if you have an accountant who handles your company’s accounts, it is still your responsibility as a director to ensure that they are filed on time. You should not solely rely on your accountant to meet the filing deadline.

Filing online is the preferred method for most companies. When you file your accounts online, Companies House will send you an email confirming receipt and registration of your accounts. To file online, you may need a company authentication code. If you need a new code, make sure to request it in advance, as it can take up to 5 days to arrive at your company’s registered office.

Software filing is also a popular option, with over 65% of companies using this method. Various software providers offer accounting packages that allow you to prepare and file accounts electronically. Depending on the functionality of the software, most types of accounts can be filed using this method.

In the near future, as per the Economic Crime and Corporate Transparency Bill, filing accounts using software will become mandatory. Paper filing and filing through online services will no longer be allowed. Companies House will inform businesses about the phased rollout of this change once the Bill becomes an Act. It is important to prepare for this transition and ensure that your company is equipped to file accounts using software.

If your company is unable to file online or by software, you can send paper accounts. However, this option should only be used if it is absolutely necessary. Keep in mind that paper accounts require manual checking, which can take over a week to process. To avoid delays and rejections, it is crucial to send paper accounts well before the deadline. Additionally, make sure to send the documents to the correct Companies House office to prevent redirection and further delays.

For companies registered in Scotland, starting from 4 September 2023, all documents need to be sent to the Cardiff office of Companies House. The Edinburgh office will no longer handle such filings. It is important to stay updated on the location of the appropriate office to ensure your documents reach the right destination.

It is worth noting that postal delays are not accepted as grounds for appealing a late filing penalty. Therefore, it is essential to plan ahead and allow enough time for the filing process to be completed without any complications.

Conclusion:

Filing your company’s annual accounts on time is a vital responsibility as a director. Late filing can have negative consequences, including penalties, damage to your company’s reputation, and limited access to finance. To avoid these issues, it is recommended to file online or through software. If paper filing is necessary, ensure that the documents are sent well before the deadline and to the correct Companies House office. By prioritizing early and accurate filing, you can safeguard your company’s financial standing and maintain a positive reputation in the business community.