26th May 2023 – Hillmans Weekly Update

Welcome to our round-up of the latest business and tax news for our clients. Please contact us if you want to talk about how these updates affect you. We are here to support you!

Have a great bank holiday weekend. 

Kind regards,
 
Steve
 
Steven Hillman BSc (Hons) ACA
Chartered Accountant
Tel: 01934 444100
https://www.hillmans.co.uk

How high could interest rates rise?
Earlier this month the Bank of England (BOE) raised interest rates for a 12th consecutive time as the rate of rising prices remains high. The Bank rate has gone up from 4.25% to 4.5%. The BOE has been under pressure to put rates up because it has a target to keep inflation at 2%, but prices are currently rising at more than five times that level. The rate of interest is at its highest for almost 15 years.

The BOE has been increasing interest rates since December 2021 to try to control inflation, which now stands above 10%. It looks like the UK Government will miss its pledge to halve inflation by the end of the year and the BOE has warned that the pledge may not be met until 2025. The BOE decision has an immediate impact on some borrowers and savers.

So how do you go about managing your business during these turbulent times with increasing inflation, rising interest rates, and economic uncertainty? What actions should a business owner take right now?

Take some time to look at your business’s strengths, weaknesses, opportunities, and threats and get a clear understanding of its position in the marketplace, the competition, the systems, the way things are done, and the improvements that could be made.

Focus on what the business is to look like when it is “complete” or running profitably and successfully. You can then determine priorities – the big issues that need to be focussed on – and make a plan.

It is also a good idea to plan for a range of scenarios from “good to bad” so that you can be flexible about the direction your business should take. 

Please talk to us about your plans; we can assist with cash flow planning and “what if” scenarios.   

We have considerable experience in helping clients write plans, forecasting results and monitoring their success against goals. We would be delighted to help you and we also have access to a range of finance providers and can help your business succeed!
 
How much is my business worth?
This is a question many of our clients want answering! The truth is, it depends on a range of factors and any valuation is only useful as a guide for planning froward. The ultimate value of a business is the price a willing buyer is prepared to pay for it.  

The prevailing economic climate and state of the business’ sector can affect company valuation for better or worse, as can your reasons for selling. If you need a fast sale due to ill health, for instance, the value may be lower than if a sale was taking place under more favourable circumstances.

Valuing a business is a complex process and we are available to support you throughout.

So, what are the most common methods of valuing a business?

Price to earnings ratio (P/E)
The price to earnings ratio uses multiples of profit, so may be an appropriate valuation method if you own a well-established business with a good track record of profits. ‘Price’ refers to the company’s current share price, and ‘earnings’ to the earnings per share (EPS). The P/E ratio indicates the business’ expected growth in earnings per share in the future.

Discounted cash flow
Discounted cash flow relies on estimating future cash flows for the company, and a residual business value, and may be suited to businesses with few assets.

Entry cost
Entry cost valuation involves calculating how much it would cost to build your business to the stage that it’s reached now, including start-up and recruitment costs, marketing, and the value of assets. Any savings that could have been made should then be deducted to arrive at the valuation.

Asset valuation
The asset valuation method may be suitable if your business is well established and owns high levels of tangible assets. The Net Book Value (NBV) of assets is calculated, then adjusted to take account of external factors such as depreciation and inflation.

Valuation based on industry
Some businesses are valued based on the industry in which they operate. The retail industry is one such example, where the number of outlets is an important element for consideration. Industry ‘rules of thumb’ use factors specific to an industry and can provide a more accurate calculation in some cases.

Other considerations when valuing your business
Intangible assets are a key factor when valuing a business. Intellectual property, goodwill, business reputation, and even a premium business location, can all add considerable value in the eyes of potential purchasers.

Spotlighting these intangible assets also allows you to improve their value where appropriate – for example, registering ownership of a trademark or patent, building up their reputation even further, or improving the condition of your business premises.

Please talk to us about valuing your business as this can lead to a range of important considerations and actions.   
 
Business Energy Aid Toolkit
The Business Aid Energy Toolkit provides manufacturers with access to experts and equipment, helping you make significant reductions to your energy usage in short time frames. Support is available in areas such as:

• Data-driven insights into your energy usage;
• Help to identify production planning improvements;
• Pinpointing cost-saving measures;
• Discovering opportunities to reduce your carbon footprint and work towards Net Zero; and
• Expertise from a team of specialists.

See: Business Energy Aid Toolkit - GOV.UK (www.gov.uk)
 
HMRC late payment interest rates to be revised after Bank of England increases base rate
The Bank of England Monetary Policy Committee announced on 11 May 2023 that it would increase the Bank of England base rate to 4.5% from 4.25%. HMRC interest rates are linked to the Bank of England base rate. As a consequence of the change in the base rate, HMRC interest rates for late payment and repayment will increase.

These changes will come into effect on:

• 22 May 2023 for quarterly instalment payments, and
• 31 May 2023 for non-quarterly instalments payments.

See: Rates and allowances: HMRC interest rates for late and early payments - GOV.UK (www.gov.uk)
 
Latest HMRC strike news
Members of the Public and Commercial Services (PCS) Union working in East Kilbride and Newcastle on employer PAYE have been asked to strike from 10 May, returning on 5 June. The PCS union has announced the following strike dates for HMRC staff in employer PAYE:

• 22-26 May; 
• 29-31 May; and 
• 1 and 2 June.

HMRC recommends that employers use its online services to resolve their query where possible on strike days. It is unclear if HMRC will reallocate staff between helplines which could reduce service on other lines.

See: News | Public and Commercial Services Union (pcs.org.uk)
 
Agritech Bridge programme - ‘Digitising the food supply chain.’
The AgriTech Bridge Programme has been developed as part of the government's Digital Growth Grant delivered by Eagle Labs. Partnering with Codebase, this programme aims to bring together some of the UK’s leading corporate and large established businesses with promising start-ups from the UK.

The theme for the AgriTech Bridge programme is ‘Digitising the food supply chain.’ It is aimed at anyone within the food supply chain including growers, processors, distributors, retailers, manufacturers, packaging, or logistics.

The programme allows start-ups to build digital expertise while established businesses are introduced to new technologies, skills, and cultures to transform and accelerate innovation.

The aim is to enable strategic thinking and innovation to co-create and help realise the UK industry ambition to become a global leader in sustainable and secure food supply chains.

If you would like to get involved in the AgriTech Bridge Programme, these upcoming information sessions provide an overview of the programme and what commitment would be required from you:

Date: Tuesday 30 May 2023
Time: 10am to 11am
Register your place

Date: Wednesday 31 May 2023
Time: 3pm to 4pm
Register your place

See: Agritech Bridge- What is it? Tickets, Tue, May 30, 2023 at 10:00 AM | Eventbrite
 
Shopping Prices Comparison Tool
Each month, the Office for National Statistics (ONS) publishes  the latest annual inflation rate, which measures the change in the price of regularly purchased items (known as the basket of goods and services) compared with the same time the previous year.
Some goods and services contribute more to the overall inflation rate than others: if some items see a large increase in prices, while others stay more stable, then inflation would be driven by the changing prices in that spending category.

So, how the headline inflation rate affects your household depends on which items you tend to spend your money on. The shopping prices comparison tool has been built to help people understand why their household might have experienced inflation.

See: Consumer price inflation, UK - Office for National Statistics
 
Innovate UK KTP Awards 2023
Nominations are now open for this year's Innovate UK KTP Awards, celebrating the most positive impacts of Knowledge Transfer Partnerships.

This is an opportunity to showcase your project, the results and solutions achieved. You will be able to demonstrate the impact your KTP partnership has had on the business, the Knowledge Base, and the Associate in front of a variety of business leaders, academics, and innovation specialists.

This year's awards categories will include:

• Best KTP Award,
• Technical Excellence Award,
• Best Management KTP Award (NEW),
• Business Impact and Transformation Award,
• Changing the World Award,
• Future Leader Award,
• KTP Academic of the Year Award, and
• Best Knowledge Base KTP Support Team Award.

The deadline for nominations is Friday 26 May 2023.

See: Awards – Knowledge Transfer Partnerships (ktp-uk.org)
 
Net Zero Living Digital Accelerator: round 1
UK registered businesses can apply for funding to develop digital applications to solve challenges in delivering net zero for places. Innovate UK, part of UK Research and Innovation, will invest up to £1.5 million through this competition, as part of the Net Zero Living programme.

The aim of this competition is to support ambitious, early-stage digital focussed businesses in developing and delivering net zero in relation to challenges based on place. This must be done through data driven digital applications and by collaborating with potential customers and product users.

By accelerating their journey, the funders hope to create high growth businesses that will drive forwards digitalisation across the UK and globally in net zero sectors, creating jobs, growing a customer base, and delivering customer value.

Your proposal must focus on two or more net zero challenges across:

• Power,
• Heat,
• Mobility, and
• product manufacture and usage.

Your digital product must be for domestic, commercial, industrial, or local authority users, and must utilise a number of datasets relevant to place. Links to other sectors are also welcome, where relevant to the delivery of net zero. You must collaborate with at least one potential customer or product user as part of the project. Your project’s total grant funding request must be between £150,000 and £300,000.

See: Competition overview - Net Zero Living Digital Accelerator round 1 - Innovation Funding Service (apply-for-innovation-funding.service.gov.uk)
 
Analysis for Innovators (A4I) competition: round 10
UK businesses can apply for a share of up to £3 million to resolve productivity and competitiveness issues by working with top scientists and research facilities. Innovate UK, part of UK Research and Innovation, is investing up to £3 million in small collaborative innovation projects, including partnerships with:

• the National Physical Laboratory,
• the National Measurement Laboratory,
• the National Engineering Laboratory,
• the Science and Technology Facilities Council,
• National Institute for Biological Standards and Control,
• National Gear Metrology Lab,
• Newton Gateway to Mathematics,
• Advanced Sustainable Manufacturing Technologies, and
• Henry Royce Institute.

This competition aims to match the best UK scientists and cutting-edge facilities with businesses with complex analysis or measurement problems.

Your proposal must describe a measurement or analysis problem where you are seeking a solution to improve your business' productivity or competitiveness. You must provide an estimate of the value to your business of solving it.

If successful at this stage, you will be invited to brokerage consultations with relevant Analysis for Innovators (A4I) partners. These will focus on potential approaches to solving your problem. You will work together to propose joint projects to develop solutions and apply for the stage 2 competition to request funding.

See: Competition overview - Analysis for Innovators (A4I) Round 10 – Stage 1 - Innovation Funding Service (apply-for-innovation-funding.service.gov.uk)
 
Longer lorries to be allowed on Britain’s roads
The government is changing regulations to allow longer trailers on GB roads, which it estimates will save 70,000 tonnes of carbon dioxide from being released into the atmosphere. 

These longer trailers, known as longer semi-trailers (LST) measure up to 2.05 metres longer than a standard semi-trailer and can be towed by a lorry.

The move follows an 11-year trial to ensure LSTs are used safely on roads, and operators will be encouraged to put extra safety checks and training in place. The trial demonstrated that LSTs were involved in around 61% fewer personal injury collisions than conventional lorries. 

Legislation was laid before the UK parliament on the 10 May 2023 to roll out the longer vehicles on roads from 31 May. The longer lorries will be able to transport consumer goods and retail products, as well as waste packaging, parcels, and pallets.

See: UK economy boosted by £1.4 billion as longer lorries roll out on roads - GOV.UK (www.gov.uk)
 
HMRC close the VAT registration helpline 
From‌‌‌‌‌ ‌‌‌Monday‌‌‌ ‌‌22 May 2023, HMRC will close the VAT registration helpline – a subsidiary of the VAT helpline – which is dedicated specifically to helping customers who have a concern around their VAT registration application. Advisers from this helpline will be redeployed to spend their time processing VAT registration applications instead of answering calls through the helpline.  

Over 85% of calls to the VAT registration helpline are from customers who want an update on the progress of their applications.

The 'Where's my reply' tool gives an expected response date. HMRC staff are spending most of their time talking to customers about their submitted applications and – as that information is already available online – they believe this time can be better used to process those applications instead.  

HMRC state that applicants can expect a reply within 40 working days. Those with applications that have been submitted within 40 working days should not contact HMRC.  

Those who submitted an application more than 40 working days ago, or are replying to a request for further information (VAT 5),  should use the dedicated email inbox, vrs.newregistrations@hmrc.gov.uk. Applicants who have not received a response to their initial application within 40 working days, will receive a reply to their email within five working days.

19th May 2023 – Hillmans Weekly Update

Welcome to our round-up of the latest business and tax news for our clients. Please contact us if you want to talk about how these updates affect you. We are here to support you!

Have a great weekend. 

Kind regards,
 
Steve
 
Steven Hillman BSc (Hons) ACA
Chartered Accountant
Tel: 01934 444100
https://www.hillmans.co.uk

Artificial Intelligence – Can it work for your business?
With the new wave of artificial intelligence (AI) technology, there’s an opportunity to automate many routine or administrative tasks and improve the overall efficiency of your business.

One AI tool that has gained significant attention recently is ChatGPT.

Developed by OpenAI, ChatGPT is an advanced language model that can understand and generate human-like text. This technology has the potential to revolutionise the way businesses work, which is why we have created our list of FAQs to help you understand this new wave of technology.

1. What is ChatGPT?

ChatGPT is a natural language processing AI model that can understand and generate human-like text. It uses machine learning algorithms to analyse large amounts of data and provide insights and recommendations based on the patterns it detects and information it has been ‘fed’.

Before using the system, it is important that you familiarise yourself with it. The easiest way to access ChatGPT is to log into OpenAI’s webpage.

2. How can businesses use ChatGPT?
One of the most popular uses is treating ChatGPT as a research assistant or intern within your business and training up the system to automate repetitive tasks such as data entry, invoicing, and reporting, essentially freeing up your time for more complex and strategic work.

There is also the opportunity to improve efficiency and accuracy. For example, it can identify trends and flag potential risks.
AI can help you stay up to date with industry updates and trends by using sources such as news articles, reports, and social media. Depending on the version used and information provided, it can provide insights and recommendations based on the latest developments, enabling businesses to adapt quickly and stay ahead of the curve.

ChatGPT could be integrated into your workflows so it can provide you with real-time updates, insights, and reports. By training ChatGPT on specific industry terminology and practices, it can better understand and generate accurate reports depending on the request or ‘prompt’ made.

Finally, it is worth noting that this is a language model, so we mustn’t overlook that it can write or rewrite text such as emails, blogs, or content, all based on the tone of voice you wish to convey.

3. What is a ‘prompt’?
A ChatGPT prompt is the piece of text you input/use to initiate a conversation or request a response from the system. For example, if you want ChatGPT to generate a production report, you might provide it with a prompt such as “please generate a production report for the first quarter of 2023.” ChatGPT will then use its deep learning algorithms to examine the prompt and generate a response that is relevant and accurate based on the input provided.

The quality of the response will depend on the quality and written structure of the prompt and the training data used to develop the ChatGPT model. This is why it is important to ensure you are using the most effective prompts and it should be noted that this can take time to master.

4. How secure is Chat GPT?
Naturally, we need to ensure that any sensitive financial information shared with ChatGPT is kept confidential and not accessed by unauthorised parties. We therefore advise that no confidential data is shared with the platform unless you are using a secure communication channel.

It’s also essential to verify that the ChatGPT model you are using has appropriate safeguards in place to protect data confidentiality.

Data integrity is also important. Businesses need to be confident that the information they receive from ChatGPT is accurate, reliable, and not tampered with.

We would always recommend verifying any critical information generated by the model before making any important decisions. It’s important to note at this point that no version of the system has fully up to date information, therefore the latest legislation etc. will not be generated as part of any response unless the data is input by the user within the prompt.

5. What is next?
To get the most out of ChatGPT, it is necessary, from a team and system perspective, to invest time and resources in training and development.

With an estimated 2000 AI tools being created each week, there are several platforms and tools available to access ChatGPT, including ‘OpenAI’s API’, ‘GPT-3 Playground’ and ‘Hugging Face’s Transformers’. Each platform has its unique features and capabilities, so it’s worth exploring to find the one that best suits your needs.
 
Changes to the VAT online account
From Monday 15 May 2023, unless you are already using Making Tax Digital (MTD) compatible software, you will no longer be able to use your existing VAT online account to file manual VAT returns. That is because by law, all VAT-registered businesses must now use Making Tax Digital (MTD) compatible software to keep their VAT records and file their VAT returns.

What businesses need to do now to avoid a penalty 
Step 1. Choose MTD-compatible software that’s right for your business – talk to us immediately!
Step 2. Check the software permissions to allow it to work with MTD. Go to GOV.UK and search 'manage permissions for tax software' for information on how to do this.
Step 3. Keep digital records for current and future VAT returns – more information about what records must be kept digitally is on GOV.UK.
Step 4. File your future VAT returns on time using MTD-compatible software. You can find out how to submit your VAT returns on GOV.UK.

You may receive a penalty if you don’t file on time via compatible software. For VAT accounting periods starting on or after 1 January 2023 HMRC introduced new penalties for VAT returns that are submitted late and VAT which is paid late. The way interest is charged has also changed.

You can find more information about new VAT penalties on GOV.UK or by watching a recorded webinar for businesses. 
 
Review your online sales promotions to ensure they are compliant
The Competition and Markets Authority (CMA) is urging online businesses that sell goods, services, or digital content to consumers in the UK to review their online sales promotions to ensure they do not mislead consumers or give a false sense of a deadline.

These sales promotions are known as price reduction claims and urgency claims, and businesses use these tactics on their website homepage and other advertising channels. When designed fairly, they can alert consumers to genuine special offers or give them helpful information about current selling conditions.

A price reduction claim example includes using comparison prices to highlight a special offer - ‘now £80, was £150' - when the higher price does not reflect the usual price. In that instance, it can give a deceptive impression of the price advantage the consumer will benefit from if they buy now.

An urgency claim can be a countdown clock highlighting when a sale or special offer will finish. For example, ‘ends in 2 hours 10 minutes’, but when the time runs down, the promotion does not end.

How do I make my online sales promotions compliant?
You should review your online practices to ensure they meet the requirements of consumer protection law and make changes if needed. As part of your review, you should:

• look at all online activities including advertising, website, and apps;
• ensure anyone working on the claims for your online activity understands the legal requirements;
• keep records as evidence to verify the claims you make; and 
• ensure price promotions are verified, special offer prices end when the promotion ends, and online advertising is correct.

If you sell products or services on an online marketplace, ensure the information you get from third party sellers is correct.

See: Urgency and price reduction claims: are your online tactics legal? - Competition and Markets Authority (blog.gov.uk)
 
New guide on cyber security for smart cities
The National Cyber Security Centre (NCSC) has released joint guidance to help communities balance the cyber security risks involved with creating smart cities.

This collaborative guidance has been designed alongside agencies from the US, Australia, Canada, and New Zealand to help ensure connected technologies are integrated into infrastructure in a way which protects systems and data.

The guide acknowledges that smart cities, or connected places, have the potential to offer communities cost savings and quality-of-living improvements, but notes these benefits must be balanced with the risks.

These risks include an expanded and interconnected attack surface, risks from the supply chain and vulnerabilities that can be introduced by automating infrastructure operations.

Organisations considering adopting smart city technologies are encouraged to consult this new guidance to understand the vulnerabilities and avoid exposing citizens, businesses, and communities to cyber risks.

See: Cybersecurity Best Practices for Smart Cities (cisa.gov)
 
Mental Health Awareness Week 2023
Mental Health Awareness Week is an annual event where the whole of the UK comes together to focus on achieving good mental health. The week aims to tackle stigma and enable people to understand and prioritise mental health. This year’s Mental Health Awareness Week takes place from 15 May to 21 May 2023, and the theme is Anxiety.

Anxiety is an important human emotion but, in some circumstances, it can get out of hand and become a mental health problem. A lot of different things can contribute to feelings of anxiety, including exams, relationships, a new job, a date, or a big life change. It is also an emotion people frequently experience around money and not being able to meet life’s basic needs.

See: Mental Health Awareness Week 2023 | Mental Health Foundation
 
Apply for an Advance Valuation Ruling
Get an Advance Valuation Ruling to give you legal confirmation on the correct method to use when valuing your goods to make an import declaration.

When you import goods into the UK, you must work out the correct method to use to work out their customs value.

You can apply to HMRC for an Advance Valuation Ruling before you make an import declaration to:

• check that the valuation method you have identified is correct; and
• get a legally backed decision that you can use this method before you make your import declaration.

It can take up to 90 days to give you a decision once you’ve applied and your application has been accepted.

See: Apply for an Advance Valuation Ruling - GOV.UK (www.gov.uk)
 
New online hub launched for food businesses
The new 'Here to Help' hub brings together a range of guides, documentation, and checklists on how to:

• set up a food business,
• achieve a good food hygiene rating, and
• manage allergens to keep customers safe.

At a time when new food businesses are facing cost pressures and other challenges, the FSA and local authorities want to make it easier for businesses to do the right thing.

The hub aims to encourage businesses to access these free resources and to recognise that the FSA, as well as the Environmental Health Officers within their local councils, are there to help them run a compliant and safe business.

As part of the campaign, the FSA has also made available new case studies on their blog, telling real stories about how working with your local authority and the FSA helps get your business off the ground and grow safely and successfully.

See: Guidance for food businesses | Food Standards Agency
 
Last chance to claim Pension Credit and qualify for £301 Cost of Living Payment
There are just four days to go for people to claim Pension Credit and still qualify for the latest £301 payment, which they will receive direct into their bank accounts. Provided a claim is made before 19 May, it can be backdated for up to three months so long as the applicant was also eligible to receive it during that time.

• Pensioners urged to check if they could be eligible for Pension Credit, worth over £3,500 a year on average.
• Those who successfully claim by 19 May could also receive a £301 Cost of Living payment – demonstrating the Government’s focus on delivering the five priorities, including halving inflation, growing the economy, and reducing debt.

Pensioners can check their eligibility and get an estimate of what they may receive by using the online Pension Credit calculator

12th May 2023 – Hillmans Weekly Update

Welcome to our round-up of the latest business and tax news for our clients. Please contact us if you want to talk about how these updates affect you. We are here to support you!

Have a great weekend. 

Kind regards,
 
Steve
 
Steven Hillman BSc (Hons) ACA
Chartered Accountant
Tel: 01934 444100
https://www.hillmans.co.uk

Creating your business’s future
According to the International Monetary Fund (IMF), the UK economy is predicted to shrink for the remainder of 2023 and then grow by only 1% in 2024.

Interest rates continue to rise as pressure grows on the Bank Of England to call time on its aggressive monetary tightening campaign. There remains uncertainty in the Banking sector with First Republic becoming the third bank to be taken over by US regulators in the last two months and Asian stocks fell recently as more fears about the health of US regional banks have dented market confidence.

These events are mainly outside of our control and it’s worth remembering that in a 2009 book, the notable management consultant, Peter Drucker, was quoted as saying, “You cannot predict the future, but you can create it.”

So how do you go about creating your future during these turbulent times?

Start with writing a business plan. This is an essential tool for looking at your options, whether it is for raising finance or for putting your objectives into writing. In either event, a business plan will give you some form of direction, help you set goals, and most importantly, enable you to monitor your success.

Business plans should be as clear as possible, and since brevity aids clarity, they should also be as short as possible. A useful way of achieving this without losing any important points is to stratify the plan by confining all details, where possible, to an appendix, leaving only the overall message in the body of the document. This will enable the reader to master the basic points of the plan more quickly.

We have considerable experience in helping clients write plans, forecasting results, and monitoring their success against goals. We would be delighted to help you and we also have access to a range of finance providers and can help your business succeed!
 
Recruitment tips in a changing environment
The UK employment rate was estimated at 75.8% in December 2022 to February 2023, 0.2 percentage points higher than September to November 2022.

The increase in employment over the latest three-month period was driven by part-time employees and self-employed workers.

Growth in average total pay (including bonuses) was 5.9% and growth in regular pay (excluding bonuses) was 6.6% among employees in December 2022 to February 2023. In the same quarter, average regular pay growth for the private sector was 6.9%.

In January to March 2023, the estimated number of vacancies fell by 47,000 on the quarter to 1,105,000. Vacancies fell on the quarter for the ninth consecutive period and reflect uncertainty across industries, as survey respondents continue to cite economic pressures as a factor in holding back on recruitment. 

If you are looking to recruit just now there are a number of actions you can take to make your business attractive to new staff. In addition to reviewing your pay and conditions to be as competitive as possible, these include:

• Tasking recruitment as a permanent process; 
• Regularly asking existing staff, customers, and suppliers for introductions;
• Offering incentives for referrals;
• Making sure you are running constant online social media and local advertisements;
• Embracing flexibility in hours and location in your business;
• Introducing a “Golden Hello” and loyalty bonusses for length of service (typically one to three years);
• Advertising testimonials from existing staff;
• Using government initiatives for apprentices;
• Making your company and the job sound as attractive as possible by outlining the position to sound prestigious and challenging. These two factors are big incentives for bright potential candidates;
• Knowing that job satisfaction comes from feeling respected and having the opportunity to learn new things and excel in the face of obstacles when advertising the role; and
• Conveying your business’s personality so potential employees get a feel for what it would be like to work for you;

Recruiting new employees is a lengthy process, so to stand out, “be different”! For example, some employers are now offering “Wellbeing leave” in addition to the usual holiday package.

Useful guidance on the procedures for recruitment can be seen in the ACAS guide “Recruiting staff” which can be seen here: Recruiting staff (acas.org.uk)

See: Labour market overview, UK - Office for National Statistics (ons.gov.uk)
 
The British Business Awards 2023
Nominations are open for the SmallBusiness.co.uk 2023 British Business Awards. Celebrating its sixth year, these prestigious awards recognise, honour, and celebrate the outstanding and innovative achievements of small and medium-sized British businesses across all industries. In the wake of the pandemic, British small businesses have faced new and unprecedented challenges. That’s why this year’s awards are all about celebrating the resilience, creativity, and success of these businesses. The closing date to apply is 26 May 2023.

See: British Small Business Awards | Celebrating the leaders in the small business community
 
Employers' Liability Insurance
Your employees may be injured at work or they, or your former employees, may become ill as a result of their work while in your employment. They might try to claim compensation from you if they believe you are responsible. The Employers’ Liability (EL) (Compulsory Insurance) Act 1969 ensures that you have at least a minimum level of insurance cover against any such claims.

You may not need EL insurance if you only employ a family member or someone who is based abroad.

You can be fined £2,500 every day you are not properly insured. You can also be fined £1,000 if you do not display your EL certificate or refuse to make it available to inspectors when they ask.

See: Employers' liability insurance - GOV.UK (www.gov.uk)
 
Self-Assessment: Be alert to potential scams
Self-Assessment customers, who are starting to think about their annual tax returns for the 2022 to 2023 tax year, should guard against being targeted by fraudsters, warns HMRC.

Fraudsters target customers when they know they are more likely to be in contact with HMRC, which is why Self-Assessment customers should be extra vigilant to this activity. There is a risk they could be taken in by scam texts, emails or calls either offering a refund or demanding unpaid tax, thinking that they are genuine HMRC communications referring to their Self-Assessment return.

Some customers who have not done a Self-Assessment return previously might be tricked into clicking on links in these emails or texts and revealing personal or financial information to criminals.

Criminals claiming to be from HMRC have targeted individuals by email, text and phone with their communications ranging from offering bogus tax rebates to threatening arrest for tax evasion. Contacts like these should sound alarm bells - HMRC would never call threatening arrest.

Anyone contacted by someone claiming to be from HMRC in a way that arouses suspicion is advised to take their time and check the scams advice from HMRC.

Customers can report any suspicious activity to HMRC. They can forward suspicious texts claiming to be from HMRC to 60599 and emails to phishing@hmrc.gov.uk. Any tax scam phone calls can be reported to HMRC using their online form.
 
What is Property finance?
Our property finance experts specialise in arranging finance for new build, conversion and refurbishment projects for property developers and investors.

Our property finance experts also arrange competitive bridging loans to ‘bridge’ a timing gap between a debt coming due, or the main line of credit becoming available. Our experts can also help you to purchase your business freehold with a Commercial Mortgage tailored for you.

The benefits of arranging Property Finance are:

• Access to highly competitive rates, arranged by a team of experts who will walk with you to completion and beyond, advising you every step of the way;
• Access to a full range of property finance products from a vast range of lenders; and
• Bespoke solutions tailored to you.

Our experts can advise you on a range of solutions such as Bridging Finance, Development Finance, Developer Exit Loans, Second Charge Loans, Property Investment Loans and Impaired Credit Loans. Ask us for an introduction!
 
HMRC launches the Advance Valuation Ruling Service for importers
HM Revenue and Customs (HMRC) has launched the Advance Valuation Ruling Service (AVRS), a new service that gives importers legal certainty that their chosen customs valuation method is correct.

When importing goods into the UK, traders must work out the value of their goods to calculate their Customs Duty and import VAT.

Traders will apply online for an Advanced Valuation Ruling where HMRC will confirm the method used to calculate the value is correct. It is legally-binding for 3 years and the trader will use this information to calculate the value of their goods on their import declaration.

See: New service launched to make importing easier for UK traders - GOV.UK (www.gov.uk)
 
New law on Tipping passes
Withholding tips from staff becomes unlawful as the “Tipping” Bill achieves Royal Assent. More than 2 million workers will have their tips protected and be able to view an employer’s tipping record. An estimated £200 million a year will go back into the pockets of staff by retaining tips that could have otherwise been deducted. The measures are expected to come into force in 2024, following a consultation and secondary legislation.

See: Millions to take home more cash as new law on Tipping passes - GOV.UK (www.gov.uk)
 
FCA proposes to simplify rules to help encourage companies to list in the UK
The Financial Conduct Authority (FCA) proposes to reform and streamline the listing rules in the UK to help attract a wider range of companies, encourage competition, and improve choice for investors.

At present, businesses wanting to list shares on any of the Financial Times Stock Exchange Group (FTSE) indexes - which include some of the largest world-wide firms - have to hold a premium listing and are required to comply with the UK's highest standards of regulation and pay substantial costs.

The FCA has said it wants to make the rules companies must follow to be allowed to list their shares in the UK, "more effective, easier to understand and more competitive".

While the UK has been Europe's biggest financial hub for many years, listings in the UK have reduced by 40% since 2008, according to The UK Listing Review.

The decision by a firm to list is based on many more factors than regulation alone, such as taxation and the availability of capital.

However, the listing regime in the UK has been seen by some issuers and advisers as too complicated and onerous. This is why the FCA is proposing significant changes to the listing rulebook, including replacing its existing ‘standard’ and ‘premium’ listing segments with a single category for equity shares in commercial companies.

Under the proposals, requirements would be focussed on transparency for investors to support decision making and sponsor oversight at the listing gateway to ensure companies can meet the FCA’s standards.

A single equity category would remove eligibility requirements that can deter early-stage companies, be more permissive on dual class share structures, and remove mandatory shareholder votes on transactions such as acquisitions to reduce frictions to companies pursuing their business strategies.

The proposed changes aim to provide a simpler and more accessible UK listing regime for companies, improving the attractiveness of listing in the UK and providing a wider range of investment opportunities for investors.

The FCA wants an open discussion about the change to risk appetite that a listing regime based on disclosure and engagement, rather than regulatory rules, would require.

See: FCA proposes to simplify rules to help encourage companies to list in the UK | FCA

Protect your workers from violence and agrression
Violence and aggression at work can have a serious impact on your workers physical and mental health.  

The Health and Safety Executive (HSE) has refreshed its guidance on violence at work to help you protect your workers. It has been updated to:

• simplify the navigation to help you easily find the information you need;
• remove outdated content and replace it with up-to-date practical guidance; and
• remind you that HSE’s definition of violence includes aggression, such as verbal abuse or threats – this can be face to face, online or over the phone. 

The guidance will help you assess the risks, put the right controls in place to protect workers and report incidents and learn from them.

See: Violence and aggression at work - HSE
 
Managing drug and alcohol misuse in the workplace
Understanding the signs of drug and alcohol misuse (or abuse) will help you manage health and safety risk in your workplace. The Health and Safety Executive website has step-by-step guidance to help you manage drug and alcohol misuse at work.

This includes advice on how to develop a drugs and alcohol policy and what you can do to support your employees.

See: Managing drug and alcohol misuse at work - Overview - HSE

5th May 2023 – Hillmans Weekly Update

Welcome to our round-up of the latest business and tax news for our clients. Please contact us if you want to talk about how these updates affect you. We are here to support you!

Our office will be closed on Monday 8th May for the bank holiday to celebrate the coronation of His Majesty King Charles. We hope all our clients get the opportunity to enjoy this additional bank holiday. Normal office hours will resume on Tuesday 9th May.

Kind regards,
 
Steve
 
Steven Hillman BSc (Hons) ACA
Chartered Accountant
Tel: 01934 444100
https://www.hillmans.co.uk

Reducing the impact of inflation
The cost of living has surged at its fastest pace in almost 10 years, with consumer prices, as measured by the Consumer Prices Index (CPI), being 10.1% higher in March 2023 than a year before

The increase is primarily due to higher fuel and energy prices but the cost of second-hand cars and eating out also increased, the Office for National Statistics (ONS) have said.

Review your prices
Inflation can significantly affect the profitability of a business as it reduces the purchasing power of both the business and its customers. Inflation will affect the amount you pay for stock, wages and other expenses, so now is a good time to reflect on the prices you charge your customers to ensure you will remain profitable.

Therefore, it's essential for businesses to regularly review their pricing strategy to ensure they remain profitable and keep up with the inflation rate.

Here are a few ideas to help with price reviews:
•           Review your Cost of Goods Sold (COGS) regularly to assess the need for price adjustments.
•           Consider inflation's impact on COGS and adjust prices accordingly.
•           Analyse market trends, competitors' pricing, and customer demand for the optimal pricing strategy.
•           Conduct surveys to gauge customer willingness to pay and adjust prices accordingly.
•           Experiment with different pricing strategies to improve profitability.
•           Communicate price increases transparently and in a timely manner.
•           Monitor the impact of price increases and adjust pricing accordingly if necessary.
•           Offer promotions, payment plans or discounts to ease the transition for customers to the new pricing structure.

If a business doesn't increase its prices to keep up with inflation and maintain profitability, it may struggle to cover its costs, leading to reduced quality and can put the business's long-term viability in jeopardy.

Please talk to us about planning ahead because we have considerable experience with helping our clients with their strategy and sustainability in turbulent times.

What’s really important?
With the constant news surrounding the economy, interest rate uncertainty, and high inflation, its difficult not to worry about these issues and lose sight of what’s really important – the health and welfare of you and your loved ones.

The issue we all face is a potent mix of inflation, recession, high debts, and the core reason for it all, a wartime energy shock. It is not the market driving the crisis; it is geopolitics, diplomacy, and conflict. On an individual level these events are not within our control, so what can we do to keep rational whilst this crisis unfolds?

It is worth remembering a quote from the singer Celine Dion: “Life imposes things on you that you can’t control, but you still have the choice of how you’re going to live through this”.

Firstly, know that you can only control your life and those close to you. Everything else going on is typically uncontrollable just now, so take time to set some long-term goals to give you a sense of agency and control. Next, List the things that make you happy and safe, by doing this you can focus on the good things and not the other stuff. Thirdly, take time out to do things you enjoy. Doing something you are good at reinforces a sense of self-worth and purpose.

If you own a business, then:

1. Take time to review your personal objectives – the business is there to provide you with what you want from life, not the other way round!
2. Look at where the business is now: its strengths, weaknesses, opportunities, and threats. This will give you a clear understanding of its position in the marketplace, the competition, the systems, and the way things are done and the improvements that could be made.
3. Focus on what the business is to look like when it is “complete” or running profitably and successfully. You can then determine priorities – the big issues that need to be focussed on.

It is also a good idea to look at where you are now and plan for a range of “good and bad” scenarios so that you can be flexible about the direction you should take.

Ask us about our One Page Analyst, a “what if” scenario planner which takes your projected 2023 figures and allows you to work out the effect on profit of reducing expenses, increasing sales, increasing, or decreasing prices.

If you need help during the next few months, please call us – we are here to support you!
 
Can you create more ‘productive’ time?
For many small business owners, if they have one consistent issue, it would be that there is simply not enough time in the day to achieve all the things that need to be done.

Have you ever got to the end of the day, having worked your “socks off” for the entire day, and asked the question “what on earth have I done today?”  If the answer is yes, then the next question is “how many days per week do you get this feeling?”

So, what can you do, in an office environment for example, to free up some time for productive and focussed activities?

Do Not Disturb (DND)!
By far and away the simplest technique to create time is to ensure that you set time aside for you to carry out the tasks on your “To Do List”.

We have all heard managers announce, “I have so much to do; I am working from home tomorrow”.  This is an example of putting yourself into a DND mode to allow you to complete tasks that are on your “To Do List”.

Why is this so? - All too often we come into our business premises with a list of tasks that we intend to complete.  The telephone rings, customers and suppliers want time, fellow employees come into your office also seeking your time, and emails and correspondence continues to flow onto your desk – Is this a familiar feeling?

If you meet with your team and agree with them that this is the case for many of them, then it makes sense to agree we need to do something about it.

The recommendation is to switch the office into a DND mode for typically 1 to 2 hours every day.

The DND mode includes no external telephone calls coming through to employees, no internal telephone calls, no disturbing employees internally, and a discipline to switch off emails other than for those relevant for the “To Do List” of the individual employee. Many businesses rotate their DND time amongst their employees.

The net result of this is that people get more of a sense of achievement at the end of a day, and this often results in a feeling of satisfaction and far less stress.

Here are some other “time saving” techniques that might work in your business:

• If you have ever found yourself thinking “it is easier to do it myself”, then maybe try and discipline yourself not to do so and delegate (and, if necessary, train) where at all possible. There is a fine line between delegation and abdication – supervision is required when one delegates, and feedback is helpful so you can keep control of the process.
• If you have asked somebody to do something there has to be an assumption that this will done be unless you have been told otherwise. It is a mistake to allow anybody not to tell you if they can’t do something that has been agreed to be done.  This may sound obvious, but the research is quite clear; there are too many occasions where things just simply do not get done despite requests, and it can be very time consuming to redeem the position.

• We all receive too many emails and the methodology that may work for some employees is to have emails sent to another supporting source, whose job it is to read all emails with the following three outcomes:
  • Delete emails because they are not relevant;
  • Forward onto the relevant employee with the words “Please read but no action required”; or
  • Forward onto the relevant employee with the words “Please read - action required”.
• The “One touch” only rule – in the ideal world the best efficiencies come from reading an email or letter once and dealing and responding directly to the customer.  To have to re-read is generally considered inefficient.

• Don’t laugh, but if you have a chair in or around your desk, people will sit in that chair.  If people sit in a chair the discussion will take longer than if they are standing – so, do you want to have a chair for people near your desk?

By adopting some or all of the ideas listed above, you, as an employer, could create an additional amount of productive time which may also improve employee confidence.
 
Business asset finance explained
Business Asset Finance is an agreement that enables businesses to obtain the assets needed to manage and/or expand effectively and spread the cost/outlay.

Regardless of the size of business, the decision to invest in assets is always difficult but take a look at some of the benefits:

• A great alternative to a traditional bank loan;
• Increased tax benefits;
• Payments can be budgeted according to cash flow; and
• Lenders secure against the asset.

Specialists can advise on:

• Hire Purchase - allows you to buy an asset and pay for it over a period of time, spreading the cost via an agreement with a finance company. An initial deposit is payable; and
• Finance Leases – a rental agreement through which an asset can be obtained for a fixed term. At the end of the initial term, the agreement can be extended, or sold with a rebate of the sale proceeds to the client.

You will need to ensure your management accounts are up to date, you have current detailed lists of debtors and creditors and all assets, and you might need up to date projections before a lender will consider your application. Please talk to us about finance, we can introduce you to finance specialists who have many years of experience and success in advising business across a wide range of sectors.
 
Bill discounts for energy and trade intensive sectors
Applications have now opened for energy and trade intensive sectors that are most affected by the rise in global energy prices to claim further discounts on their bills between 1 April 2023 and 31 March 2024.

Ceramics and textiles are among the wide range of sectors potentially in line to benefit. These companies use high amounts of energy to deliver their goods, but also are exposed to strong international competition, meaning they cannot raise their prices to cover the increase in costs they have faced.

The offer is part of the government’s new Energy Bills Discount Scheme, launched last month, which will continue to automatically give businesses across the UK money off their energy.

Businesses are advised to, as soon as possible, find out their eligibility and what they need to do to apply. Discounts could be reflected in bills from as soon as June, with support backdated to 1 April. This could save some around 20% on predicted wholesale energy costs.

See: Energy Bills Discount Scheme - GOV.UK (www.gov.uk)
 
Interest rate increases on the Court Funds Office accounts
In response to the increase in the Bank of England base rate on 23 March 2023, the Lord Chancellor has reviewed the Court Funds Office (CFO) rates of interest payable to clients and from 21 April 2023 these changed to the following:

• Special Account – increased from 4.0% to 4.25%; and
• Basic Account – increased from 3.0% to 3.188%.

The Lord Chancellor has made this decision to ensure that the running costs of the CFO service can continue to be met and that an increased rate of interest payable to clients can be provided.

See: Interest rate increases on the Court Funds Office special and basic accounts - GOV.UK (www.gov.uk)

Statement from the Confederation of British Industry (CBI) board
The CBI has suspended key activities until June after a number of businesses left the business group following allegations of rape and sexual assault. Many more businesses have announced they are leaving the group or pausing their membership after new allegations about misconduct at the organisation.

The full statement from the CBI board can be seen here: Statement from the CBI board | CBI
 
First aid at work: the basics
The Health and Safety Executive (HSE) have produced ‘basics for your business' webpages offering health and safety advice, whatever industry you work in.

The basic step-by-step guide on first aid at work explains how you can have the right arrangements, including:

• a first aid kit,
• training workers,
• first aid for homeworkers, and
• appointing first aiders.

Other 'basics for your business' topics include reporting accidents and illness and ensuring you have the right workplace facilities.

See: Health and Safety Made Simple: The basics for your business (hse.gov.uk)