FOLLOW US

Call 0191 580 5100

or email us to arrange a meeting

Author Archives: Michael Hendy

View our 2020 Budget Report

Posted on by

Chancellor Rishi Sunak delivered his first Budget, and the first since the UK’s departure from the European Union, against the backdrop of the coronavirus outbreak.

The Chancellor announced a £30 billion stimulus package to support the economy through coronavirus contagion and pledged to give the NHS whatever extra resources are needed to cope. 

Following the news that the Bank of England had reduced interest rates to 0.25%, in an emergency response to the coronavirus, Mr Sunak put further measures in place. 

These include Statutory Sick Pay (SSP) for employees who are advised to self-isolate, even if they are displaying no symptoms. The government will also meet some SSP costs for businesses.

In addition, business rates for shops, cinemas, restaurants and music venues in England with a rateable value below £51,000 have been suspended for a year. This tax holiday will be worth up to £25,000 to thousands of businesses across the retail, leisure and hospitality sectors. 

Citing the latest economic forecasts from the Office for Budget Responsibility, Mr Sunak said the economy is predicted to grow by 1.1% this year. However, the GDP forecast does not fully account for the impact of coronavirus. 

Turning to duties, tax on beer, wine, cider and spirits have been frozen while tobacco duty will continue to rise by inflation plus 2%. Fuel duty will also remain frozen, for a tenth consecutive year, despite widespread speculation that it would rise. However, Mr Sunak introduced other green measures including a new tax on plastic packaging and freezing the climate change levy on electricity while raising it on gas. The Chancellor also promised to spend £500 million to support the rollout of new rapid charging hubs for electric cars.

In addition, Mr Sunak resisted calls to end Entrepreneurs’ Relief, although the lifetime allowance will be reduced from £10 million to £1 million. The Chancellor will abolish the so-called ‘tampon tax’, reducing the VAT rate on sanitary products to zero from 1 January 2021, as well as scrapping VAT on digital e-publications, including e-books, e-newspapers, e-magazines and academic e-journals, from 1 December 2020.

The Budget confirmed increased spending on infrastructure projects including broadband, railway and roads. £5 billion was promised to get gigabit-capable broadband into the hardest to reach places and £510 million of new investment into the shared rural mobile phone network.

Budget Highlights

  • A reduction in the Entrepreneurs’ Relief lifetime limit
  • An increase in the Employment Allowance
  • An increase in the rate of Structures and Buildings Allowance
  • An increase and extension of business rates discounts
  • Extended access to Statutory Sick Pay due to coronavirus
  • An increase to the National Insurance thresholds
  • Fuel duty to be frozen for the 10th consecutive year
Share

2017 Autumn Budget – the business reaction

Posted on by

Business groups have responded to the key announcements made in Chancellor Philip Hammond’s Autumn Budget speech.

The Federation of Small Businesses (FSB) welcomed the reforms to the business rates system. Mike Cherry, its National Chairman, commented: FSB presented a series of reforms to the Chancellor to make the business rates system fit for the future, and we are delighted to see so many taken on board to improve a tax that so badly undermines economic growth.

We are particularly proud to see the elimination of the staircase tax, a victory that FSB has campaigned hard to secure over the last few months.

Meanwhile, the Institute of Directors (IoD) stated that the Chancellor dipped his toe in the water with this Budget, but failed to make a splash with business. The IoD went on to say that companies will be disappointed with what they got.

It did, however, welcome the Chancellor’s decision not to reduce the VAT registration threshold, branding this a relief.

The Confederation of British Industry (CBI) welcomed the announcements made in the Budget. Carolyn Fairbairn, Director General of the CBI, said: This is a Budget that balances support for people on squeezed incomes with vital action to help grow the UK out of austerity.

Action on business rates, R&D tax credits, the National Productivity Investment Fund and Brexit planning will help firms to invest and grow today against an uncertain Brexit backdrop.

The British Chambers of Commerce (BCC), however, stated that more needs to be done to ensure that the Brexit process runs as smoothly as possible. Dr Adam Marshall, Director General of the BCC, said: Despite the inclusion of a number of announcements that will support business communities in the short term, more will still need to be done over the coming months to lay the groundwork for a successful Brexit transition.

Businesses will expect greater boldness from the Chancellor and more radical support for infrastructure and investment  once a Brexit transition period is secured and the shape of a UK-EU deal becomes clearer.

 

Share

2017 Autumn Budget – the economic picture

Posted on by

Within his Autumn Budget speech, Chancellor Philip Hammond reported on an economy that continues to grow, continues to create more jobs than ever before and continues to confound those who seek to talk it down.

However, in its report prepared for the Autumn Budget, the Office for Budget Responsibility (OBR) revised down its outlook for productivity growth, business investment and Gross Domestic Product (GDP) growth across the forecast period.

The OBR now expects GDP to grow by 1.5% this year, 1.4% in 2018 and 1.3% in 2019 and 2020. It predicts such growth to then pick up to 1.6% by 2022.

In addition, government borrowing is set to fall in every year of the forecast, Borrowing this year will be 2.4% of GDP.

It will then fall from £39.5 billion in 2018 to £25.6 billion in 2022/23, reaching its lowest level in 20 years.

Inflation is set to rise to 3% during the final quarter of 2017, and will ‘fall back towards target over the next year.

Share

Chancellor presents 2017 Autumn Budget, ‘building on Britain’s global success story’

Posted on by

 

Chancellor Philip Hammond’s first Autumn Budget was delivered against a backdrop of economic and political turmoil, fuelled partly by ongoing uncertainty in the Brexit process.

Acknowledging that the UK has entered a critical phase of negotiations, the Chancellor set out his vision of a new relationship with the European Union – though he was keen to emphasise the need to prepare for every possible Brexit outcome, announcing that £3bn had been set aside for Brexit preparations.

While asserting that the economy continues to confound those who talk it down, the Chancellor revealed that the Office for Budget Responsibility has revised down UK economic growth for the next five years, with the economy expected to grow by 1.5% in 2017. Debt is also expected to reach a peak this year, reducing gradually thereafter as a share of GDP, while borrowing forecasts have also been revised downwards.

Technology and housing formed a key focus of the speech, with the Chancellor announcing a package of support for electric vehicles, including £400m for new charging points, and a £44bn investment fund to support the government’s target of building an average of 300,000 new homes every year, over the next five years.

There was also some good news for first time buyers, as the Chancellor revealed that those seeking to buy a property worth up to £300,000 would be exempt from paying Stamp Duty Land Tax with immediate effect. Meanwhile, the income tax personal allowance will increase to £11,850 from April 2018, with the higher rate threshold rising to £46,350.

Although making a feature of his resistance to reducing the VAT registration threshold, the Chancellor did address the issue of business rates, announcing that firms being affected by the so-called staircase tax could apply to have their original bills reinstated and backdated, and that future revaluations will take place every three years.

Finally, entering at least partially into the festive spirit, the Chancellor announced that duty on most alcoholic drinks will be frozen, although a new band of duty will be introduced for higher strength alcohol, including some ciders.

Share

Wage growth ‘likely to remain weak’, study suggests

Posted on by

 

A study carried out by the Chartered Institute of Personnel and Development (CIPD) has suggested that wage growth is set to ‘remain weak’.

Pay rises for 2018 have been forecast at just 1%. The study attributes the subdued forecast to an increase in labour supply over the past year.

Meanwhile, 23% of private sector firms stated that National Living Wage (NLW) costs have affected pay growth.

21% of businesses cited uncertainty in regard to access to the EU single market as having an effect on income growth, and a further 21% believe that the government’s auto enrolment pensions scheme has affected wage growth.

Gerwyn Davies, Senior Labour Market Analyst at the CIPD, said: ‘Predictions of pay growth increasing alongside strong employment growth is the dog that hasn’t barked for some time now, and we are still yet to see tangible signs of this situation changing in the near-term.

‘The facts remain that productivity levels are stagnant and public sector pay increases remain modest, while wage costs and uncertainty over access to the EU market have increased for some employers.’

Share

FSB urges government to delay National Living Wage rise

Posted on by

The Federation of Small Businesses (FSB) has called on the government to consider whether forthcoming rises in the National Living Wage (NLW) rate may need to be delayed if the economy cannot bear the pace of change.

By 2020, the NLW will have risen to £8.75 per hour. The business group has suggested that any risk to the UK economy should be ‘built into the next NLW increase’, which is currently scheduled for April 2018.

The NLW should not rise any higher than £7.85 next year, the FSB has suggested.

The call to delay further increases comes following the FSB publication of new research, which revealed that 64% of small firms affected by the NLW have taken lower profits in order to meet the latest rate rise.

43% of small businesses have had to increase their wages to meet the demands of the NLW, the research also suggested.

Mike Cherry, National Chairman of the FSB, said: ‘Small employers have demonstrated their resilience in meeting the challenges set by the NLW, with many cutting their margins or even paying themselves less to pay their staff more.

‘In sectors where margins are tight, small firms are resorting to more drastic measures to cope with the NLW.

‘It’s vital that the NLW is set at a level that the economy can afford, without job losses or harming job creation. Cost pressures on small businesses are building, and with most recent economic indicators underperforming, we are now facing the reality that the NLW target may need to be delayed beyond 2020.’

Share

Shoestring startups show resilience with a third of companies founded on £250

Posted on by

 

A smiling and positive hipster man turning an opening sign on glass front door of coffee shop with reflection of street in glass
A lack of funding was cited by 40 per cent of Britons as the biggest barrier to starting a business

A new study demonstrating the long-term potential of shoestring startups founded on tight budgets has challenged the expectation that a business needs significant financial backing to succeed.

The research, undertaken by Yell Business ahead of Independent Retail Week, surveyed 1,500 small UK business owners to find out how much new ventures were costing to launch.

Some 40 per cent of companies were founded on under £500, while a third managed to take off with funds of just £250. Meanwhile, 93 per cent reported they had recorded a profit in the past year.

Yell Business also surveyed 1,500 UK consumers to gain an insight into attitudes towards the entrepreneurial world.

Over half of the population admitted they had considered starting a company of their own – and almost a third unhappy with their current career – but several risks were commonly cited as holding back a new wave of business owners.

With 40 per cent of the vote, insufficient funding was far and away the biggest barrier to starting a business. A risk of failure was also keeping a quarter of would-be founders from following their dreams, while 23 simply didn’t know where to start.

Commenting on the success of shoestring startups, Mark Clisby, Yell Business marketing director, pointed to inherited funds and redundancy as current catalysts for new founders.

“Hopefully, the positive revelations around low startup cost and high success, will give the inspiration needed to budding entrepreneurs, so that they don’t wait for scenarios like this to happen to them,” he said.

Offering pointers to potential business owners, Clisby said thorough research into the market and taking a digital-first approach were crucial starting points.

“From a website, social media to reviews, this is essential for any business in 2017,” he added.

With 85 per cent of founders claiming their own venture had seen at least moderate growth, the evident success of shoestring startups might be enough to spark those ambitions into life.

Putting a shoestring startup on a platform for success

One business owner firmly in the 33 per cent is Neil Bainbridge, founder of music PR firm Neighbourhood, a company that has grown to now represent major clients such as Warner Music and Universal Music Group. Bainbridge recalled some of the key early decisions that shaped the future of his firm to offer some advice to aspiring entrepreneurs.

“Founding a company is of course challenging. There is a huge range of assumptions of what needs to be done and in what order. For example, the early predicament of establishing tone and vision for the company you want to grow into over time, yet creating enough flexibility in the brand to avoid suppressing new opportunities and direction.

“As a service-based company the only additional cost to bear was my own solo time and effort, so 99 per cent of any first expenditure was spent with the above in mind. The same rule would have applied if I would have had access to £250 or £2500.

Bainbridge explained that getting the right first impression – in terms of visual aesthetic, tone and guidelines – was essential in those early stages.

“Making the day-one choice of dropping ‘PR’ in the logo of Neighbourhood was one of these decisions. We never want to dilute what we do as a PR agency, so you won’t find us claiming to be marketeers, creatives, SEO consultants or designers as many so-called PR companies do. We were initially conscious of that first perception.

“Public relations by default is a trade that is constantly moving and redefining itself, so our look and logo always needed to accommodate that.

“From an image point of view, Neighbourhood’s company aesthetic fundamentally needed to support the fact that the best work we do is almost invisible. For the first two years of Neighbourhood, we didn’t have a website. Just a holding page with a logo.

“We are all too familiar with the line ‘dress for the job you want, not for the one you have’. I think laying down the foundations of what can become company guidelines can learn a lot from that.”

Megan Allen, founder of Rural Roots PR, was another entrepreneurial publicist who started her business “from scratch” with just £250 in the bank.

“I invested the into the website domain, hosting and some business cards,” Allen told Business Advice, who then had to teach herself to build the company’s website.

“I took a part-time job to help me fund the business as I still had a mortgage to pay, and joined a local networking group. Within three months I’d given up the part-time job and was working for myself full-time,” she added.

“I honestly don’t know what I could have done differently and I’m proud of what I’ve achieved in just over a year.”

Sharing her words of wisdom for fellow founders, Allen said: “Learn as much as you can yourself to start with, and when you’ve got some capital behind you, invest in professional services to boost your business even further.”

Share

Britain’s best small business names attracting high street shoppers

Posted on by

high street shoppers

Dublin, IrelandD - May 7, 2016: People walking on the Grafton Street.
Some 40 per cent of shoppers would choose to shop in a store with an imaginative name over a generic one

What’s in a name? The long-term success of a high street store, according to a new study revealing the UK’s best small business names.

As a new founder, key early decisions might include a viable growth plan, a thorough understanding of your target market as well as an idea of potential clients and customers. However, research from marketing supplier Vistaprint has now put the name of a business among those essential considerations.

The study surveyed the shopping habits and opinions of 2,000 UK consumers to not only reveal the 20 most unique names, but also highlight the more subtle effects of an unforgettable brand.

Some 40 per cent of respondents said a memorable name would encourage them to enter a shop ahead of a more traditional title. Further, a third of shoppers were likely to recommend a business to a friend if its name left a good impression.

The long-term effect of a uniquely titled store was also confirmed, as one in ten said they could recall a striking name from over a decade ago.

Overall, six in ten high street shoppers favoured creative names over more generic ones.

The 20 best small business names on UK high streets

  1. Spruce Springclean, carpet cleaners, Lostwithiel, Cornwall
  2. Surelock Homes, locksmith, Portsmouth
  3. Planet of the Grapes, wine bar and restaurant, London
  4. Floral and Hardy, florists, Hertfordshire
  5. A Fish Called Rhondda, fish and chip shop, Pentre, Wales
  6. Wright Hassall, solicitors, Leamington Spa
  7. Jean Claude Van Man, removal company, Merseyside
  8. Sellfridges, white goods outlet, Stoke Newington
  9. Grate Expectations, fireplace specialists, Wimbledon
  10. Bonnie Tiler, tiling and plumbing, Gateshead
  11. Deja Brew, coffee house, Denton
  12. The Chopfather, barbers, Bristol
  13. Barnie’s Rubble, DIY shop, Bolton
  14. Facial Attraction, beauty salon, Pontypool, Wales
  15. Samuel ‘L’ Jackson, driving instructor, Southport
  16. Hair Raid Shelter, hairdressers, Downham Market, Norfork
  17. Alan Cartridge, office supplies, Leeds
  18. Jason Donervan, food truck, Bristol
  19. Frying Nemo, fish and chip shop, Yorkshire
  20. PG Trips, bus charter, Houghton le Spring

Commenting on the best small business names, Oliver Harcourt, head of Vistaprint UK, said innovation and imagination were central characteristics of Britain’s entrepreneurs and should be drawn upon from day one.

“Having a creative business name is one example of how you can be more memorable to your customers and stand out from the crowd,” he said.

“Some of the shops from our poll are businesses that are generations old, showing that a catchy name can stand the test of time.”

Looking more closely into the high street power of original and memorable branding, two-thirds of consumers said the ability to raise a smile made a shop more appealing. Meanwhile, half said it made the business easier to remember.

The subconscious impact went even further. A quarter of respondents believed they received better service from a store with a unique name.

“Our survey also found that eight in ten Brits like to try and shop locally where possible,” Harcourt added.

“We’re happy to see local stores keeping up the tradition of having creative and witty names as a way to stand out in their communities. We look forward to seeing many more to come in the future – and we’ve even created a guide to help new businesses come up with a memorable name for themselves.”

Share

Small Business Saturday announces fifth UK campaign date

Posted on by

 

Small Business Saturday Campaign

The UK campaign will celebrate its fifth anniversary in December

This year’s UK-wide Small Business Saturday campaign will take place on Saturday 2 December, it has been announced.

The campaign, originally founded in the US by American Express in 2010, celebrates Britain’s small and micro businesses and encourages consumers to spend more at small firms.

Now in its fifth year in the UK, Small Business Saturday has become increasingly popular. Hundreds of thousands of businesses now participate every year, while some 80 per cent of local UK authorities now recognise and promote it.

The amount spent by shoppers at small and micro businesses on Small Business Saturday rose by nearly £250m between 2013 and 2016 –  an increase of 53 per cent. Last year, an estimated £717 million was spent with small UK businesses on the day itself.

Announcing the date for Small Business Saturday 2017, campaign director Michelle Ovens said: “Our aim this year is to get even more businesses around the UK to experience the effect of Small Business Saturday.

“We have a growing and highly engaged network of small business owners who recognise the benefit of getting involved and making the campaign work for their own companies and in their own communities.”

As well as encouraging consumer spending, the campaign also encourages small business promotion via social media. In 2016, more than 130,000 tweets were sent on Small Business Saturday itself, reaching more than 140m people, with Small Business Saturday UK trending at number one in the UK and at number five globally.

As with previous years, in 2017 events will be planned across Britain in the run-up to and on Small Business Saturday itself, including the return of the annual nationwide bus tour, and the annual search for the Small Biz 100 – the small businesses to be profiled each day in the 100 days leading up to 2 December.

To mark the day, small business owners will be invited to create special events or promotions themselves. The campaign will once again run Inspire, a nationwide series of free workshops run by experts and entrepreneurs for existing and aspiring small business owners.

Commenting on the benefits of last year’s campaign, Rowena Howie, the owner at small London fashion business Revival Retro, said: “Not only did we have more new interest shoppers and higher footfall on Small Business Saturday, we also saw a 35 per cent increase in sales compared with the same Saturday in 2015.”

Carolyn Frank, owner at Libby Butler Jewellers in Helmsley, near York, added that people are more aware of small businesses all year round because Small Business Saturday.

“I think it’s because it’s a genuine grassroots initiative that’s gathered pace so quickly, and it has reminded customers about the great variety and choice that small businesses can offer,” she said.

American Express remains the principle supporter of Small Business Saturday in the UK, but other campaign partners include PRS for Music, Dropbox and Mercedes Benz Vans.

Small Business Saturday is also backed by key business organisations, including the Federation of Small Businesses (FSB) and Enterprise Nation.

 

 

Share

Making Tax Digital pilot scheme launched by HMRC

Posted on by

HM Revenue & Customs (HMRC) has launched a new Making Tax Digital for Business (MTDfB) pilot scheme, designed to ‘make it easier for customers to get their tax right’.

The launch of the pilot scheme represents HMRC’s next step in moving taxpayers to a fully digital tax system.

From April, businesses and their agents will be invited to sign up to the new service which will allow them to report their income and expenses online.

In addition to being able to make use of accounting software to record their business income and expenses, firms will be permitted to send quarterly summary reports directly from their digital records and sign up to ‘go paperless’.

HMRC states that, based on the information that customers submit, businesses will receive an ‘estimated tax calculation’.

Once the new service has been thoroughly tested by the first group of businesses, HMRC will invite other customers to join the pilot scheme. Upon receiving participants’ feedback, the Revenue will then seek to develop and improve the service.

Share