Marginal Gains

Forget January tax mayhem and focus on financial planning

As you all know we had a big push to make our January; and that of our client’s, so very different many others who might be scrambling around looking for paperwork and panicking over what tax is due and whether they can afford it.

One final comment on the note of tax returns; watch out for the change in penalty structure kicking in very soon whereby more information can be found here.

We want you to look forward towards the end of the current tax year so are thinking of 5 April 2022 and putting our efforts and thoughts into focusing how we better get money out of the business for YOU rather than focusing on pleasing the tax man this month.

We’ll soon be sharing some food for thought but if you want early access and want to be ahead of the game with this exercise then get in touch with your account manager today.

Operationally

So COVID is still lingering but there is; albeit limited, still some support out there with local councils expected to see the financial support come through imminently and more information can be found here.

Ignoring COVID for a minute, when was the last time you reviewed your suppliers and considered:

  1. What do you need to cut
  2. What do you need more from i.e. ask for early payment discount or even cash back
  3. What do you need to spend more on to generate more value

One client alone this week has taken step 2 and will save £000’s this year as a result of one single conversation!

Those business new years resolutions already suffering?

Be it individually; or as a business, we all need routine and accountability and I’m sure we can all relate to that from a fitness perspective.

Once you have both – BOOM!

Get in touch with your accountancy manager if you want help overcoming the January blues with some very quick and easy strategies to help you do so.

P.S. They do not involve meditation though I believe that also might be useful.

P.S. More information on our
client awards very soon …

Business Succession

It doesn’t always have to be a gamble

Did you know that less than 1 in 2,222 sell their business at the time planned for the amount that they hoped to sell it for?!

There are many reasons for this including staffing and share structures impacting sale process, poor succession planning and key person dependencies or just simply a general lack of retirement planning.

If you knew those odds before you started in business, would you still have invested your life in it?

The good news is that many businesses still defy these odds and some do it in spectacularly impressive ways!

Technology unlocks opportunity

Technology has proved to provide both massive opportunities and risks within businesses of all sizes.

Sticking to the gambling theme (but not encouraging it!), there is inspiration to be taken from Phil Cronin who established Tombola in the North East of England in 1999.

He initially worked within his father Edward Thompson’s printing business until 1995 but recognized a gap in the market presented by the idea of putting bingo cards online instead or printing them.

Tombola reached audiences in homes and countries that could never have been reached by the original business model and became a flag bearer for responsible game play.

Their association with I’m a Celebrity, Get me out of here catapulted them into the consciousness of the nation and this week it was announced that they had been acquired by Flutter in a deal worth £400m+.

Not bad from a company that started of printing bingo cards!

Conversely, there are other examples around us of businesses that have missed the opportunity that technology delivered, and which on reflection were quite simple and obvious at the time – Netflix versus Blockbuster, local taxi companies versus Uber and so many more.

We are often talk about the pareto principle of 80% of a companies profits being attributed to less than 20% of their customer base.  How many business people act upon this and how many people; like Phil Cronin, actually try to flip these percentages by scaling those that make up the most profitable 20% segment?

Family succession with impact

Another example from the gambling sector is Bet365. One that defied odds that you would think were stacked against them from the start.

Peter Coates was born into poverty and had several commercial interests of varying success during his business journey. One of those was Provincial Racing, a handful of ultimately underperforming betting shops that operated across the country.

His children were involved in the family businesses from a young age with daughter Denise working as a cashier in one of the betting shops. The reality at the time was that the betting shops served as a distraction from one of the other family businesses – a catering company that serviced football grounds.

Fast forward a few years and with an economics degree under her belt, Denise was to become the operating manager of Provincial Racing – a business she described as “a handful of rubbish shops that was up for the challenge to improve.”

It is at this point where many people give up. However, by just looking beyond the basic numbers in front of them and adding some context to the figures, they identified the opportunity that the internet might afford them.

In January 2000, Denise purchased the domain name Bet365.com for £10,000 from eBay and went toe to toe with Ladbrokes and William Hill; whilst working from a portacabin.

They expanded their reach far beyond their competition to ultimately provide 24/7 opportunities to bet on something, somewhere at any time of day. 

How did they keep growing so quickly? A big part of their success was a continuous reinvestment of profits and the identification of continuous ways to improve and innovate over the competition (not dissimilar to the theory marginal gains that we have previously written about).

Bet365 remains privately owned with most revenues reaching £2.8 billion across international markets.

Repackaging and reinventing

In your business, you might think you are sat on “rubbish” (as Denise described it) but it might just be something that would benefit from repackaging alongside a new strategy to take it in a direction in which it can succeed.

By bringing in a team with a different vision or specialist expertise, perhaps you too could see future family members taking your business forward?

You could be sat on a rough diamond but do you; or will you ever, truly know.

Add a degree of structure and some digging beneath the surface and you too could defy the odds and join us on our mission to help more business owners to take less of a gamble and ultimately leave behind a legacy for future generations to be proud of.

National Lockdown Financial Support

As expected a financial support package has today been unveiled and we would assume; though cannot say for certain, there may be more support on the way.

In summary, there is 

  • one-off top up grants for retail, hospitality and leisure businesses worth up to £9,000 per property to help businesses through to the Spring
  • £594 million discretionary fund also made available to support other impacted businesses
  • comes in addition to £1.1 billion further discretionary grant funding for Local Authorities, Local Restriction Support Grants worth up to £3,000 a month and extension of furlough scheme

For more detailed guidance this can be accessed here.

Lockdown 2 Government Support Summary

This email takes you through the announcements and what it means for your business.

On the one hand it is great to see the government making available this help. But this probably means we will see fairly strict lockdown conditions between now and March 2021. We hope we are wrong about this, but in your contingency/scenario planning, particularly in regard to cash, please extend this 4-week lockdown until the end of March. If you need help with your business planning, please get in touch.

Here are the full details from the Government’s announcement.

The Self-Employed Income Scheme
On 30th November you will be able to claim a grant for up to 80% of your profits, to cover you for Nov – Jan 2021. This is capped at £7,500. They also declared there will be one more grant which will cover the period Feb – Apr 2021. Details are yet unknown of when this will be paid or for how much.

To receive these grants, you need to have received the previous grants and it is currently anticipated that this portal will open towards the end of this month.

The ‘Furlough scheme’
This has now been extended to the end of March. Which in effect means that we are unlikely to see the Job Support Scheme operational… You can Furlough any member of staff, as long as they were on the payroll before Oct 30th 2020. And the government will pay up to 80% of their wages, capped at £2,500 per month.

As a result of extending the Furlough scheme the planned Jan 2021 ‘Job retention bonus’ of £1,000 for any employee you Furloughed who you still employed has been deferred. Until when? Who knows?

Help with cash flow
If you haven’t taken a Bounce Back Loan or didn’t take the maximum amount available to you, you can now top this up. And you will be able to take out a CBIL or Bounce Back Loan now until the end of Jan 2021.

Mortgage payment holidays for those who haven’t taken a payment holiday will be available for 6 months, without this being noted on their credit files.

As with everything these days the above is all subject to change but this looks like what we will be working with for the weeks ahead as a minimum.

Additional grants???

There are meant to be more local authority grants coming but more details are yet to be released and these may be discretionary rather than automatic but watch out for updates from respective local authorities over the coming weeks and hopefully within the next 10 days or so.

We have also got a fantastic link below to what grants you could perhaps access but which are not so widely known which can be accessed here so please feel free to follow this link here to see what you could access.

Some inside information perhaps?

We have heard on the grapevine; though not confirmed, the following:

  1. The Government are allegedly working on a new support package which is currently going through the EFG and may mirror the current CBILs scheme but be more easily accessible but please note whilst we have heard this on good authority this is not guaranteed.
  2. Following on from the above the second BBL opportunity for some; it is widely known that the first bounce back loan was never intended to cover the lengthy period of uncertainty that we now face.  There are also now rumours of a second bounce back loan opportunity exceeding the original 25% of turnover/£50k limited to reflect the increased term that the original loan was never designed to cover.

Watch this space but we thought we would share these with you as they came from a source well connected within the Bank of England.

Lockdown 2 Update (Kind Of)

As promised we thought we would get another newsletter out following the weekend’s announcement.

There are a lot of rumours circulating though including uplifts in the claims that can be made by the self-employed, proposed extension of applications for the bounce back loans and CBILs loans to 31 January 2021 AND also allegedly a second opportunity to go and get an uplift in any bounce back loans you had previously accessed if you never utilised your full allocation first time round.

There is so much information circulating online at the minute and a lot in the small print that has either been missed or yet to be finalised.

We will provide you all with a more comprehensive and clearer update once everything has been signed off in Parliament which none of it has yet but this may not come until the end of this week or early next hence us providing this update now and hopefully some positive news in the pipeline for some extra support.

As ever we as a team are here for you and if you want to reach out and chat please feel free to call your client account manager.

Government's Winter support package

Additional Government Support Announcement – Further Update

Further Update on Government’s Winter Support Package

As is commonly the case further information has filtered through from the Government’s Winter support package and the two key areas; in additional to those already highlighted are what we are going to cover in this newsletter.

Self-assessment help

Self Assessment customers can now apply online to spread the cost of their tax bill into monthly payments without the need to contact HMRC.

The online self-serve ‘Time to Pay’ service, has been increased to £30,000 for Self Assessment customers, to help ease any potential financial burden they may be experiencing due to the coronavirus pandemic.

Once you’ve completed your tax return for the 2019-20 tax year, you can use the online self-serve ‘Time to Pay’ service through GOV.UK to set up a direct debit and pay any tax that is owed in monthly instalments, up to a 12-month period.

If you wish to set up your own self-serve ‘Time to Pay’, you must meet the following requirements:

  • no outstanding tax returns
  • no other tax debts
  • no other HMRC payments set up
  • your Self Assessment tax bill is between £32 and £30,000
  • it is no more than 60 days since the tax was due for payment.

If you do not meet these requirements, you might still qualify for Time to Pay, but you will need to call HMRC to set this up.

If you set up a ‘Time to Pay’ arrangement, you will have to pay interest on the tax paid late. Interest will be applied to any outstanding balance from 1 February 2021.

Further VAT help

The Chancellor has also now announced that businesses who deferred VAT due from 20 March to 30 June 2020 will now have the option to pay in smaller payments over a longer period.

Instead of paying the full amount by the end of March 2021, you can make smaller payments up to the end of March 2022, interest free.

You will need to opt-in to the scheme, and for those who do, this means that your VAT liabilities due between 20 March and 30 June 2020 do not need to be paid in full until the end of March 2022.

Those that can pay their deferred VAT can still do so by 31 March 2021.

External Virtual Client Events

In addition to our event being held on the 1 October we are delighted to share and invite you all to two further events that are detailed below:

Friday 9 October at 2pm
Is your business your pension?
To book click here

Thursday 8 October at 3pm
Why financial planning is important
To book click here

These are events are kindly being ran by our partners at St James’s Place so please feel free to book on directly or if you have any queries regarding either of these events then please just let us know again using the funding@gtaccountants.com e-mail address.

Surviving Another Lockdown (Partial Or Full)

A further lockdown

As we enter another state of lockdown in some shape of form; depending on what part and in which country you currently operate out of, we must stick together and that is the theme of our final newsletter for September.

We are going to focus on the positive support out there that we suggest you take advantage of so that we keep fighting, take the positives from the challenges faced and those that lie ahead whilst also recognising the strain it puts on us all so reach out for help where necessary.

We do however also appreciate that everybody is probably in a state of feeling overwhelmed to some extent hence we have focused on a handful of key areas this month to help you overcome this.

Cash flow support

Whilst we are uncertain as to what additional support there may or may not be from the Government we can realistically expect greater difficulty when it comes to collecting debt.

We have subsequently established a creditors services alongside an independent third party offering to support businesses in need that will not only do some digging around amounts you are concerned about receiving but will also chase these for you.

This initial exercise is absolutely free and from the cases we have seen so far; as this is handled externally to ourselves, a client recently received over £3,000 that they have previously written off and it cost them little more than £200 that was only taken upon successful collection of the debt.

If this is a concern for you, have any queries and/or just wish to discuss this further register your interest by e-mailing us at funding@gtaccountants.com

Group Event (Virtual I’m afraid)

Whilst we did initially hope some time soon we could commence face to face meetings and have this event as being a physical one we have had to think again but we won’t let it hold us back entirely.

In addition to the online community platform that we have established with Futrli Peer and for which you can access for no charge through this link here to chat with other business owners and get some tips, we are also doing more.

We as a firm will be the lead for Enterprise Nation where we bring business owners together through Zoom but this will be a great opportunity to just let off some steam and take away some great content and advice.

There is no charge for attending and the first virtual event is on 1 October from midday for an hour so if this of interest then why not book through the link here.

Going forward we are hoping to make this a monthly event and get some guest speakers along with hopefully some special offers from partners.  We will also keep those who attend aware of funding pots as these are shared with us in addition to sharing these with you by way of our newsletters.

External Virtual Client Events

In addition to our event being held on the 1 October we are delighted to share and invite you all to two further events that are detailed below:

Friday 9 October at 2pm
Is your business your pension?
To book click here

Thursday 8 October at 3pm
Why financial planning is important
To book click here

These are events are kindly being ran by our partners at St James’s Place so please feel free to book on directly or if you have any queries regarding either of these events then please just let us know again using the funding@gtaccountants.com e-mail address.

Today’s Government Announcement

Today’s Announcement

So whilst we would usually wait until a little more detail is released, we thought we would share what we know already as we appreciate the urgency with which some people need some clarification.

As we find out more we will release a further update so watch out for any further updates in your mailbox.

The highlights are as follows:

  1. The current furlough scheme will be replaced by a new jobs support scheme as of November and will run for 6 months.  Broadly speaking current guidance is suggesting that employees must work at least a third of their normal hours, the Government subsidising a third leaving the remaining third unpaid.  Further guidance will follow around this.
  2. The self-employed grant will be extended but the exact terms of this are yet to be clarified.
  3. The deadline for applying for either a bounce back loan or coronavirus business interruption loans has been extended to 30 November 2020.
  4. Greater flexibility around bounce back loans including the possible opportunity to extend the term over which repayments are made.
  5. For those struggling with bounce back loan repayments there will be the option to potentially take a payment holiday for up to six months and make interest only repayments.  Again we expect more detail to be released around this and restrictions around those who can take advantage.
  6. VAT will remain at 5% for hospitality and tourism until 31 March 2021.

Cash flow support

Whilst we are uncertain as to what additional support there may or may not be from the Government we can realistically expect greater difficulty when it comes to collecting debt.

We have subsequently established a creditors services alongside an independent third party offering to support businesses in need that will not only do some digging around amounts you are concerned about receiving but will also chase these for you.

This initial exercise is absolutely free and from the cases we have seen so far; as this is handled externally to ourselves, a client recently received over £3,000 that they have previously written off and it cost them little more than £200 that was only taken upon successful collection of the debt.

If this is a concern for you, have any queries and/or just wish to discuss this further register your interest by e-mailing us at funding@gtaccountants.com

Group Event (Virtual I’m afraid)

Whilst we did initially hope some time soon we could commence face to face meetings and have this event as being a physical one we have had to think again but we won’t let it hold us back entirely.

In addition to the online community platform that we have established with Futrli Peer and for which you can access for no charge through this link here to chat with other business owners and get some tips, we are also doing more.

We as a firm will be the lead for Enterprise Nation where we bring business owners together through Zoom but this will be a great opportunity to just let off some steam and take away some great content and advice.

There is no charge for attending and the first virtual event is on 1 October from midday for an hour so if this of interest then why not book through the link here.

Going forward we are hoping to make this a monthly event and get some guest speakers along with hopefully some special offers from partners.  We will also keep those who attend aware of funding pots as these are shared with us in addition to sharing these with you by way of our newsletters.

External Virtual Client Events

In addition to our event being held on the 1 October we are delighted to share and invite you all to two further events that are detailed below:

Friday 9 October at 2pm
Is your business your pension?
To book click here

Thursday 8 October at 3pm
Why financial planning is important
To book click here

These are events are kindly being ran by our partners at St James’s Place so please feel free to book on directly or if you have any queries regarding either of these events then please just let us know again using the funding@gtaccountants.com e-mail address.

Government Support. Self-employment grant. CBILs and Bounce Back Loans

Second and final self-employment grant

You can as of today now claim for the second and final self-employment grant.

Don’t forget this does not apply to limited companies I am afraid.

The second and final taxable grant made available by HMRC amounts to 70% of your average monthly trading profits and is again paid out as a single instalment covering 3 months worth of profits.

This payment is capped at £6,570 in total.

The claim can be made in the same was you made the first claim and it must be made by on or before 19 October 2020.

Further information regarding the claim and the making of it can be found here.

CBILs and Bounce Back Loans

We thought we best clarify; for the avoidance of confusion, the current deadlines in place by the Government as to when it is currently proposed that each scheme be closed:

CBILs – it is current proposed that this will remain in place up until the end of September 2020 but this may be extended.

Bounce back loans – it is current proposed that these will be available up until 4 November 2020 but again is subject to revision.

Please note that the above deadlines are in reference to applying for these so if you have either of these loans already, the agreement you already have will still stand until the end of the agreed term.

Additional funding you might not be aware of

The Government has recently announced an additional £20 million of suport that is being made available through local Growth Hubs and can be used to fund:
  • one to many events providing guidance as to how to respond to coronavirus
  • small grants to access specialist professional advice
  • small grants to cover the purchase of minor equipment to adapt or adopt new technology
More information can be found here.

Business Interruption Insurance

There has recently been a rather large court case regarding this that we believe is going to appeal but if you think you might be eligible for this and have previously been turned away we recommend that you speak with your insurance company again to clarify any impact on you.

Flexible Furlough

Yes we had another late Friday night update and a client with much greater HR expertise than us has kindly shared the following with us with regards to a number of questions that might be raised.

What is a flexible furlough?

From 1 July 2020, employers can bring furloughed employees back to work for any amount of time and any work pattern.

You will still be able to claim the furlough grant for the hours your flexibly furloughed employees do not work, compared to the hours they would normally have worked in that period.

How do I put employees on flexible furlough?

From 1 July 2020, only employees that you have successfully claimed a previous grant for will be eligible for more grants under the scheme.

This means they must have previously been furloughed for at least 3 consecutive weeks taking place any time between 1 March and 30 June 2020. For the minimum 3 consecutive week period to be completed by 30 June, the last day an employee could have started furlough for the first time was 10 June.

You should have a discussion with employees who you wish to place on the flexible furlough scheme because you will need to agree the arrangements of their part time work. The agreement should be confirmed in writing and you must keep a written record of the agreement for five years.

You do not need to place all your employees on furlough. In addition, you can continue to fully furlough employees if you wish.

How long can flexible furlough last?

Flexible furlough agreements can last any amount of time. This means that they do not need to last for a minimum of 3 weeks. However, the period that you claim for must be for a minimum period of 7 calendar days. Any flexible furlough period of less than this cannot be claimed for via the scheme.

Employees can enter into a flexible furlough agreement more than once.

What do I pay an employee on flexible furlough?

You will pay the employee for the hours they work, along with national insurance contributions and pension contributions for those hours.

The scheme will allow you to recover the remainder of wages to a maximum cap. Wage caps are proportional to the hours an employee is furloughed. For example, an employee is entitled to 60% of the £2,500 cap if they are placed on furlough for 60% of their usual hours.

The amount that the scheme will cover will begin to decrease from September 2020, and you will be responsible for all of the national insurance and pension contributions from August 2020, regardless of the employee being on flexible furlough.

Claims under the new scheme will be open from 1 July 2020.

When claiming for employees who are flexibly furloughed you should not claim until you are sure of the exact number of hours they will have worked during the claim period. This means that you should claim when you have certainty about the number of hours your employees are working during the claim period. If you claim in advance and your employee works for more hours than you have told HMRC about, then you will have to pay some of the grant back to HMRC.

What records do I need to keep?

You’ll need to keep records of how many hours your employees work and the number of hours they are furloughed during flexible furlough. For example, you will need to record that an employee who normally works for 37 hours a week is actually working for 15 hours and is furloughed for 22 hours.

Can my employees work for me during ‘down time’ in flexible furlough?

During flexible furlough, employees are not allowed to do any work for you or any linked or associated organisation during the periods that you record them as being on furlough.

Employees on flexible furlough can do training during the hours that they are recorded as being on furlough, but must be paid at least national minimum wage for those hours.

How do I calculate normal working hours?

If your employee is flexibly furloughed, you’ll need to work out your employee’s usual hours and record the actual hours they work as well as their furloughed hours for each claim period.

There are two different calculations you can use to work out your employee’s usual hours, depending on whether they work fixed or variable hours.

You should work out work out usual hours for employees who work variable hours, if either:

  • your employee is not contracted to a fixed number of hours
  • your employee’s pay depends on the number of hours they work

Where the employee’s working hours are fixed, or their pay does not vary with the amount of hours worked, the reference period for calculating their hours is the hours your employee was contracted for at the end of the last pay period ending on or before 19 March 2020.

Where an employee works variable hours, you will use the higher of:

  • the average number of hours worked in the tax year 2019 to 2020
  • the corresponding calendar period in the tax year 2019 to 2020.

 

Webinars (NOT TO BE MISSED)

One of the first and most important lessons that I have learnt is the time lost with family whilst I was working on the business and this is where Joe Laws of Joe Laws Photography will be joining us to discuss what he has planned to help people always appreciate this.  Already I have scheduled in our family photoshoot and these are memories that whilst might have in the past have been forgotten, but in the future, will always be remembered.

Family versus work versus you
Book here to join us at 11.30 on Thursday 18 June.

In our second webinar, planned for two weeks’ time on Thursday 25 June, I will be discussed what I think lies ahead and what we can potentially anticipate.

What to expect next
To join click here on Thursday 25 June at 11am where I will discuss my thoughts and make this as interactive as possible for those attending to help people plot a route forward.

Don’t forget that you can register for webinars previously missed by clicking on the links on past newsletters to access a recording, going to our website, or visiting our company YouTube channel.

Claire Goodliff - Director of Multiple Companies

"Graeme was amazing yesterday! These guys are the best money I spend ever and it’s over and beyond anything I’ve ever known. They literally are part of my business!"

Claire Goodliff – Director of Multiple Companies
 

Speak to the team about your goals and vision. We'll tell you how we can help you make them a reality.

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