red leaf in frost | Business News Update January 2022 | Positive Accounts, York

Business News Update January 2022

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Business News Update January 2022

Welcome to our round up of the latest business news update 2022. Please contact us if you want to talk about how these updates affect your business. We are here to support you!

Cash Flow Is the Single Most Important Issue in My Business.

Do you agree?  Most of our other clients do.  In this economy CASH IS KINGand managing your cash flow is more important than ever.

If you are concerned about the future of your business, then take some time to reflect on where you are and what could happen in the next few months. It is now vitally important for all businesses to plan ahead for a range of scenarios. Cash flow and business planning in these uncertain times may appear difficult but there are some practical steps you can take to minimise potential disruption to your business.

  • Review your Budgets and set realistic and achievable targets for 2022.
  • Get your employees involved in a discussion of likely trading conditions and get their input on reducing costs and maintaining revenues.
  • Review and flow chart the main processes in your business (e.g. Sales processing, order fulfilment, shipping etc.) and challenge the need for each step.
  • Put extra effort into making sure your relationships with your customers are solid.
  • Review your list of products and services and eliminate those that are unprofitable or not core products/services.
  • Pull everyone together and explain the business strategy and get their buy-in.

Please talk to us about cash flow planning for the next few months, we can help with a template so you can do this yourself or work together to produce estimates for a variety of scenarios. 

HMRC gives Self-Assessment taxpayers more time to ease COVID-19 pressures

Late filing and late payment penalties are to be waived for one month for Self-Assessment taxpayers.

HM Revenue and Customs (HMRC) is waiving late filing and late payment penalties for Self-Assessment taxpayers for one month – giving them extra time, if they need it, to complete their 2020 to 2021 tax return and pay any tax due.

HMRC is encouraging taxpayers to file and pay on time if they can, as the department reveals that, of the 12.2 million taxpayers who need to submit their tax return by 31 January 2022, almost 6.5 million have already done so.

HMRC recognises the pressure faced this year by Self-Assessment taxpayers and their agents. COVID-19 is affecting the capacity of some agents and taxpayers to meet their obligations in time for the 31 January deadline. The penalty waivers give taxpayers who need it more time to complete and file their return online and pay the tax due without worrying about receiving a penalty.

The deadline to file and pay remains 31 January 2022. The penalty waivers will mean that:

  • anyone who cannot file their return by the 31 January deadline will not receive a late filing penalty if they file online by 28 February
  • anyone who cannot pay their Self-Assessment tax by the 31 January deadline will not receive a late payment penalty if they pay their tax in full, or set up a Time to Pay arrangement, by 1 April

Interest will be payable from 1 February, as usual, so it is still better to pay on time if possible.

See: HMRC gives Self Assessment taxpayers more time to ease COVID-19 pressures - GOV.UK (www.gov.uk)

If you cannot afford to pay your latest bill then you can set up a time to pay payment plan to spread the cost of your latest Self-Assessment bill if all the following apply:

  • you owe £30,000 or less
  • you do not have any other payment plans or debts with HMRC
  • your tax returns are up to date
  • it’s less than 60 days after the payment deadline

You can choose how much to pay straight away and how much you want to pay each month. You will have to pay interest.

See: Pay your Self Assessment tax bill - GOV.UK (www.gov.uk) 

Self-Assessment taxpayers must declare COVID grants on tax returns

HMRC has reminded self assessment taxpayers to declare any COVID-19 grant payments on their 2020/21 tax return. 

According to HMRC, more than 2.7 million customers claimed at least one Self-employment Income Support Scheme (SEISS) payment up to 5 April 2021. 

The tax authority says these grants are taxable and customers should declare them on their 2020/21 tax return before the deadline on 31 January 2022.

Myrtle Lloyd, HMRC's Director General for Customer Services, said:

'We want to help customers get their tax returns right, first time. We have videos, guidance and helpsheets available online to support you with your self assessment.' 

The SEISS is not the only COVID-19 support scheme that customers should declare on their tax return. Information on which support payments need to be reported to HMRC and any that do not is available on GOV.UK. 

Internet link: GOV.UK 

Self-certification period temporarily extended

The UK Government has announced that employees in the UK can self-certify sickness absence for 28 days instead of seven. The change came into force on 17 December 2021 and applies to absences beginning on or after 10 December 2021, up to and including absences, which begin on or before 26 January 2022.

See: Statutory Sick Pay: employee fitness to work - GOV.UK (www.gov.uk)


National Living Wage and National Minimum Wage rates for 2022

The UK Government have announced the rise in the National Minimum Wage and National Living Wage from April 2022.

In full, the increases are:

  • National Living Wage (23+) to increase from £8.91 to £9.50
  • National Minimum Wage (21-22) to increase from £8.36 to £9.18
  • National Minimum Wage (18-20) to increase £6.56 to £6.83
  • National Minimum Wage (16-17) to increase £4.62 to £4.81
  • Apprenticeship Wage to increase from £4.30 to £4.81

See: UK government announces pay rise for millions of people - GOV.UK (www.gov.uk)


Seasonal Workers visas extended until end of 2024

The Home Office and DEFRA have announced the Seasonal Worker visa route will be extended until the end of 2024, which allows foreign workers to come to the UK for up to six months to work in the horticulture sector.

There will be 30,000 visas available in 2022, but this will be kept under review with the potential to increase by 10,000 if necessary.

The number of visas will begin to taper down from 2023.

See: Industry given certainty around seasonal workers but told to focus on domestic workforce - GOV.UK (www.gov.uk)

 

Chancellor announces £1 billion fund for businesses

On 21 December 2021, Chancellor of the Exchequer, Rishi Sunak, unveiled a £1 billion COVID-19 fund, including cash grants of up to £6,000 per premises for each eligible firm.

Mr Sunak said the government would also help certain firms with the cost of sick pay for COVID-related absences.

The Chancellor also announced an extra £30 million to help support organisations such as theatres, orchestras and museums. 

To support other businesses impacted by the Omicron wave – such as those who supply the hospitality and leisure sectors – the government is also giving a more than £100 million boost to the Additional Restrictions Grant (ARG) fund for local authorities in England.

The Chancellor said: 

‘We recognise that the spread of the Omicron variant means businesses in the hospitality and leisure sectors are facing huge uncertainty, at a crucial time.

‘So, we’re stepping in with £1 billion of support, including a new grant scheme, the reintroduction of the Statutory Sick Pay Rebate Scheme and further funding released through the Culture Recovery Fund.

‘Ultimately the best thing we can do to support businesses is to get the virus under control, so I urge everyone to Get Boosted Now.’

Internet link: GOV.UK

 

Recovery Loan Scheme extended

Applications for this loan have been extended and are now open until 30 June 2022.

Launched on 6 April 2021, the Recovery Loan Scheme (RLS) provides financial support to businesses across the UK as they recover and grow following the coronavirus pandemic.

You can apply to the scheme if Covid-19 has affected your business. You can use the finance for any legitimate business purpose – including managing cashflow, investment and growth. However, you must be able to afford to take out additional debt finance for these purposes.

If your business has already borrowed from any of the other coronavirus loan schemes – namely:

  • the Bounce Back Loan Scheme (BBLS)
  • the Coronavirus Business Interruption Loan Scheme (CBILS)
  • the Coronavirus Large Business Interruption Loan Scheme (CLBILS)

RLS is still open to you, although the amount you have borrowed under an existing scheme may in certain circumstances limit the amount you may borrow under RLS.

At Autumn Budget 2021, the government announced that the Recovery Loan Scheme will be extended by six months to 30 June 2022, with the following changes applying from 1 January 2022:

  • The scheme will only be open to businesses with a turnover not exceeding £45m per annum
  • The maximum amount of finance available will be £2 million per business (maximum amount per Group limited to £6m)
  • The guaranteed coverage that the government will provide to lenders will be reduced to 70%

See: Recovery Loan Scheme - British Business Bank (british-business-bank.co.uk)


New laws to strengthen national security

From 4 January 2022, the government is able to scrutinise and intervene in certain acquisitions that could harm the UK’s national security.

The National Security and Investment (NSI) Act – the biggest shake-up of the UK’s national security regime for 20 years – commenced on the 4 January 2022.

The government is now able to scrutinise and intervene in certain acquisitions made by anyone, including businesses and investors, that could harm the UK’s national security.

The government will also be able to impose certain conditions on an acquisition or, if necessary, unwind or block it – although it is expected this will happen rarely and the vast majority of deals will require no intervention and be able to proceed without delay.

See: New laws to strengthen national security come into effect - GOV.UK (www.gov.uk)

Pre-departure testing removed for vaccinated travellers

Testing and border measures have changed for fully eligible fully vaccinated travellers arriving in England.

  • A lateral flow test can be used instead of PCR tests for eligible fully vaccinated travellers and over 5s to take on or before day 2
  • Eligible fully vaccinated travellers and under 18s will no longer have to take a pre-departure test or self-isolate on arrival in England – returning to the travel rules that were in place before Omicron
  • Omicron is the dominant variant in the UK and is spreading widely among the community

See: Pre-departure testing removed for vaccinated travellers - GOV.UK (www.gov.uk)


If you are asking yourself:

“Why not?”
“Why not me?
“Why not now?”
The answer is “no reason whatsoever”, so, talk to me and let’s change your business for the better.

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