Happy New Year, and welcome to our latest 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) FCA
Chartered Accountant
Tel: 01934 444100
https://www.hillmans.co.uk
2024 - A year for flexibility?
Looking back at 2023, we have been amazed at the resilient way our clients have handled the uncertain economy. You have demonstrated to us how we can all be flexible and readily adapt to a change in circumstances!
We hope that by this time next year we all will be looking back on a more settled 2024. However, we have to admit that uncertainty is an inevitable part of business life.
With this in mind, for January, we are encouraging all clients to take time to prepare a 2024 Strategic Plan. A plan that will set you on a course to success.
"A sailor without a destination will never get a favourable wind!"
We all know this simple truth: It is easier to get to your destination with a plan. When you are driving from A to B, it helps to know where B is and the direction you need to take to get there.
If you have a vision of what you want your business to look like when it is "complete" then you will be able to 'drive' your business towards that vision and monitor how you are doing as you go along.
Without a strategic plan, you could end up like flotsam in the sea; being blown 'this way and that way' without any control.
On the other hand, a plan helps you to keep your business focused on the things it is good at doing. It helps you determine where to spend time, resources and money for the best effect.
How do you put together a strategic plan?
- Take time to review your own personal objectives. The business is there to provide you with what you want from life. Do not forget this.
- Look at where you are now. Assess your strengths, weaknesses, opportunities, and threats. Identify your position in the marketplace, the competition, your systems, and what you are good (and not good) at.
- Focus on where you want to be. Look ahead (say) 2 years. What do you want your business to look like when it is running profitably and successfully? This will help you determine your priorities - the big issues on which you need to focus. This is the strategic plan!
- Write your vision down (or type it up!). Define what must be achieved and the actions you need to take.
- Allocate responsibility. Specify who is responsible for doing what.
- Monitor, review and adjust. Monitor how you are doing each month against your plan and consider what needs to be done to keep you moving forward. If your plan begins to look unrealistic, be prepared to review and adjust it.
Zero emission vehicle transition by 2035 now law
The government has set a pathway towards all new cars and vans being zero emission by 2035. This zero emission vehicle mandate became law on 3 January 2024.
The press release marking the commencement of the new laws comments that the UK now has the most ambitious regulatory framework for the switch to electric vehicles of any country in the world. The mandate is expected to help the car industry and manufacturers to have certainty and be able to safeguard jobs.
Originally the ban on new diesel and petrol cars was set to come into force in 2030, however this was pushed back to 2035 by the Prime Minister, Rishi Sunak, in September 2023. Availability of new electric cars, high costs, concerns about practicality from small businesses, and a lack of nationwide charging infrastructure were cited as the main reasons for the decision.
The postponement took the pressure off businesses and consumers alike but added uncertainty for businesses and investors involved in electric cars and the related technology. By making the mandate law it seems the government hopes to demonstrate a solid commitment to their pathway for zero emission vehicle transition by 2035.
In addition to setting the end date, the zero emission vehicle mandate also specifies the percentage of new zero emission cars and vans that manufacturers will have to produce each year up until 2030. The mandate requires that 80% of new cars and 70% of new vans sold in Great Britain be zero emission by 2030. This will then increase to 100% by 2035.
The UK's charging network continues to grow. The government reports that there are now over 50,000 public chargepoints, a 44% increase on this time last year. The target is 300,000 chargepoints by 2030.
Businesses should therefore be considering this mandate when reviewing company car and van purchases. There are tax advantages to having an electric vehicle as a company car with reduced benefit in kind costs, although these need to be weighed against the purchase cost.
It is also worth remembering that there is a plug-in van grant of up to £2,500 for small vans and £5,000 for large vans available at least until 2025 that can help defray the cost. For guidance on the grant, click here: Plug-in Van Grant guidance
If you would like any help with assessing the costs and tax on electric vehicles, please feel free to contact us. We would be happy to help!
See: https://www.gov.uk/government/news/pathway-for-zero-emission-vehicle-transition-by-2035-becomes-law
Draft business guidance to boost skills and unlock the benefits of AI
Businesses across the UK are to receive new support in unlocking the full potential of AI within their workforce.
As part of the UK government's National AI Strategy, The Alan Turing Institute is developing guidance designed to empower businesses and individuals to embrace AI. They published a draft version of the new guidance last month and held a brief public consultation inviting feedback from employers and training providers.
According to The Alan Turing Institute, this document is "the first step towards developing a full framework, which aims to support employers, employees, and training providers to identify upskilling routes and understand the competencies required to deliver value from AI."
The guidance is a high-level reference that sets out the competences needed across five key areas and will help employers to identify upskilling needs across their workforce.
You can download a copy of the draft "AI Skills for Business Competency Framework" document here: https://iuk.ktn-uk.org/wp-content/uploads/2023/11/Final_BridgeAI_Framework.pdf
Given the growing use of AI in businesses across the country, this could serve as a useful tool for employers to ensure their business harnesses the potential of AI technology. By upskilling workers, businesses will also ramp up productivity and ensure their workforce can focus on the tasks that will make the biggest impact.
This first step will be followed up by further consultation with the business community to develop sector-specific case studies and resources and a full skills framework.
See: https://iuk.ktn-uk.org/news/ai-skills-for-business-guidance-feedback-consultation-call-from-the-alan-turing-institute/
Data protection - UK-US data bridge - a factsheet for UK organisations
Following a review of the current handling and protection of personal data, the UK and US have established a "data bridge". This allows personal data to freely move between UK businesses and certified organisations in the US.
International data transfers are central to the transactions of many businesses, and under previous arrangements, any transfer of personal data to the US required costly contract clauses to ensure privacy and protection standards.
Now, where the US organisation is appropriately certified, the new bridge removes this burden.
A US organisation is placed onto the Data Privacy Framework List (DPF list) on the DPF website once they have been certified. They can then receive UK personal data through a UK-US data bridge.
UK businesses will need to ensure they update their privacy policies and document their data processing activities to reflect any changes in how they transfer personal data to the US.
See: https://www.gov.uk/government/publications/uk-us-data-bridge-supporting-documents/uk-us-data-bridge-factsheet-for-uk-organisations
Is it too cold to work?
This winter has been one of the mildest on record so far, but there is still time for a cold snap, and this often raises questions about whether it is too cold to work. In fact, this question is one of the most popular topics on the HSE website.
The Workplace (Health, Safety and Welfare) Regulations puts a requirement on employers to provide a reasonable indoor temperature in the workplace.
Clearly this will depend on what work is being done and the environmental conditions, but for an indoor workplace, the minimum temperature should normally be at least 16 degrees Celsius. This drops to 13 degrees Celsius where the work involves rigorous physical effort.
Under the same Regulations, employers have to assess the risks to workers and put in place controls to protect them. Temperature, whether indoors or outdoors, is one of those risks.
This means that employers need to be alert to ensuring that the heating in each workroom is capable of maintaining a comfortable temperature. The heating system too needs to be well maintained so that it doesn't give off dangerous fumes or offensive smells.
It may also help to check that doors and windows can be closed properly to prevent cold drafts. Flexible working hours or early/late starts may help staff to avoid low temperatures. And relaxing formal dress codes may help staff be able to dress more appropriately for the temperature.
Further guidance is available on the HSE website.
See: https://www.hse.gov.uk/temperature/employer/index.htm
4,757 festive tax return filers
HMRC announced that 4,757 taxpayers filed their Self Assessment tax return on Christmas Day.
This added to 8,876 being filed on Christmas Eve and a further 12,136 being filed on Boxing Day. Apparently, the peak time was between 12 and 1pm on Boxing Day when HMRC received 1,121 returns.
Myrtle Lloyd, HMRC's Director General for Customer Services, used the opportunity to encourage all to file their return in good time when he said: "Our Christmas Day filers proved that there is no time like the present to get started on Self Assessment ... There's no need to delay, getting it done ahead of the 31 January deadline means less stress and longer to work out payment options."
If you need help with your tax return, or haven't let us have your tax return information yet, please don't hesitate to get in touch. We will be happy to help you complete this essential job!
See: https://www.gov.uk/government/news/many-happy-returns-from-4757-festive-filers-on-christmas-day
Government reforms on reuse and recycling of electrical goods
The government has announced new UK-wide plans designed to make it easier to recycle electrical goods.
A range of measures are proposed, including:
- Collecting waste electrical items directly from households. These collections would be financed by the manufacturers, and not the taxpayer.
- Free of charge collection drop points for electrical items being provided by large retailers, without a need to buy a replacement product from the retailer.
- When delivering replacement large electrical items, such as fridges and cookers, the retailer being responsible for collecting the old one.
It is estimated that 155,000 tonnes of smaller electrical items, including cables, toasters, kettles, and power tools, are currently thrown in the bin each year with no thought to recycling. In addition, it is estimated that a further 527 million unwanted electrical items are currently sitting unused in UK homes but contain valuable materials such as gold, silver, and platinum that could be reused.
Just during the Christmas period, 500 tonnes of Christmas lights are thrown away each year in the UK.
The scale of the problem and the potential for reuse of materials mean these proposals have the potential to drive further growth in the UK's treatment and re-use sector and benefit those businesses working or expanding into this area.
The announcement also reports on a recent study on public attitudes and behaviours around recycling. The study found that around 86% of people in the UK think that recycling and the associated time it takes to do this properly is worthwhile. More than 77% of householders would see a retailer offering an electrical recycling service as more environmentally responsible.
Therefore, being able to demonstrate an environmentally conscious approach is likely to benefit any business and is well worth considering in your business plans and marketing.
See: https://www.gov.uk/government/news/government-reforms-set-to-spark-greater-reuse-and-recycling-of-electrical-goods
Paying tax on cryptoasset transactions
HMRC recently launched a new campaign targeted at crypto investors as part of a crackdown on tax evasion. They have introduced a new disclosure and payment service for taxpayers to voluntarily disclose and pay any unpaid taxes associated with cryptoassets.
Cryptoassets (also known as tokens or cryptocurrencies) include exchange tokens (for example, bitcoin), non-fungible tokens and utility tokens.
HMRC view the profits or losses incurred from buying and selling such cryptoassets as liable for capital gains tax. Only in exceptional circumstances would they recognise crypto trading as a taxable 'business' trade.
Many who own cryptoassets may not be aware of the tax obligations on these digital assets. This voluntary disclosure service provides an opportunity to put things right with potentially lower penalties than if HMRC discover the underpayment for themselves.
Such a discovery is likely to become easier for HMRC. Tax avoidance from using cryptoassets is a subject of international concern, and there are moves to require crypto platforms to share taxpayer information with tax authorities.
If you or anyone you know needs any advice or help in this area, please don't hesitate to contact us!
See: https://www.gov.uk/guidance/tell-hmrc-about-unpaid-tax-on-cryptoassets
Minimum wage rates increase from 1 April 2024
Employers should be aware that all minimum wage rates increase on 1 April of each year. For 2024, these increases are substantial. The increases apply to all National Minimum Wage rates and the National Living Wage rate.
Another change that comes with the new rates is that the National Living Wage is being extended to include those aged 21 years old and over.
Minimum wage - increased rates from April 2024
See the table below that shows the current minimum wage rates and new rates from 1 April 2024:
If you would like help with your payroll, please don’t hesitate to call us; we are here to help!
Date set for Spring Budget 2024
The Chancellor Jeremy Hunt has commissioned the Office for Budget Responsibility to prepare an economic and fiscal forecast to be presented to Parliament alongside his Spring Budget on 6 March 2024.
We will keep you updated with any announcements that could affect you or your business.
See: https://www.gov.uk/government/news/spring-budget-2024-date-confirmed
£7 million funding boost to level up high streets
A new government pilot, the High Street Accelerators programme, will be trialling efforts to regenerate high streets in 10 areas across England.
The idea is that communities will work in partnership with local authorities and businesses to tackle problems such as empty shops, anti-social behaviour and a lack of foot traffic on the high street.
The 10 selected areas will each receive an initial £237,000 to kickstart their partnerships. However, they can also apply for a share of a further pot totalling £5 million to improve green spaces and pleasant socialising environments for residents.
Over the next 2 years this funding will be spent and the impact it has on the designated high streets will be evaluated. This will help the government decide on what further action can be taken to revive high streets in these and other areas.
This pilot programme is just one initiative that the government is using to try and revive England’s high streets. New High Street Rental Auctions regulations are also to be introduced later this year that will give local authorities the ability to sell off the rental rights for empty properties to willing tenants. These could include businesses and community groups.
See: https://www.gov.uk/government/news/high-streets-levelled-up-with-7-million-funding-boost
The Levelling Up Home Building Fund
Home England is providing development loans from £250,000 to £10 million to housebuilders based in England that are finding it difficult to borrow from traditional lenders.
Whether building for sale or rent, the loans can be used to cover the development costs. Community-led housing projects, serviced plots for custom and self-builders, off-site manufacturing, new builders, and groups of small firms working together can all access this financing.
Home England state that their flexible approach, along with their in-depth knowledge of the housing sector, put them in a good position to help businesses deliver homes.
The Fund is available to UK-registered corporate entities and limited liability partnerships if they plan to build five or more homes on a site in England. A controlling interest in the land along with outline planning permission is also a must.
More information on how to apply can be found in the Home England guidance. They also provide some case studies of situations where the financing has been used.
See: https://www.gov.uk/government/news/find-out-how-the-levelling-up-home-building-fund-can-support-you
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