Government support for SMEs

Business - Management

26th May, 2022, Melanie Harriss

There are four ways you can get financial support for SMEs, to help you invest and grow.

  1. Claim up to £5,000 with the Employment Allowance

Employment Allowance is a tax relief which allows eligible businesses to reduce their National Insurance contributions (NICs) bills each year. You can claim this if you are a business, and your employer Class 1 National Insurance liabilities were less than £100,000 in the previous tax year.

  1. Get a discount of up to £5,000 on software, with Help to Grow

Help to Grow: Digital is a UK-wide government-backed scheme that aims to help you choose, buy and adopt digital technologies that will help you grow your business.

Eligible businesses can receive a 50% discount on buying new software worth up to £5,000 per SME, alongside free impartial advice and guidance about what digital technology is best suited to boost your business performance.

The Help to Grow: Management scheme provides small businesses with access to world-class business expertise on everything from leadership and financial management to marketing and digital adoption. This is delivered through leading UK business schools, alongside one-on-one support from a business mentor – and is 90% funded by the government.

By the end of the programme, you will develop a business growth plan to help you lead and grow your business.

To be eligible, you must be a UK-based SME, actively trading for at least one year and have a total of between 5 and 249 employees.

  1. Get up to half off your business rates

From April this year, small retail, hospitality, and leisure businesses can benefit from 50% off their business rates bills.

The business rates multiplier has also been frozen for another year. This is used to calculate how much business rates should be paid; it usually rises with inflation each year.

The business rates multipliers for 2022 to 2023 are 49.9 pence for the small business multiplier and 51.2 pence for the standard multiplier.

From April 2022 there will be no business rates due on a range of green technology, including solar panels and batteries, whilst eligible heat networks will also receive 100% relief.

  1. Invest in your business with Super-deduction and Annual Investment Allowance

To spur business investment, the super-deduction allows companies to cut their tax bill by 25 pence for every £1 they invest in any qualifying machinery and equipment. This can include the purchase of computers, most commercial vehicles and office furniture.

The temporary £1 million limit for the Annual Investment Allowance has also been extended to the end of March 2023. This had been due to revert to £200,000 at the start of 2022. The Annual Investment Allowance allows businesses to spend up to £1 million on qualifying business equipment and deduct in-year its full cost before they calculate their taxable profits.

Both tax breaks remain available for firms to take advantage of until the end of March 2023, by incurring qualifying expenditure before then.

If you need help in accessing any of these schemes to help support your business, please get in touch.

Related articles: Super-deduction and Annual Investment Allowance

Stephenson Smart helps new business start up flourish

New business start up - Cambridgeshire Hair and Beauty

5th April, 2022, Melanie Harriss

During the Covid pandemic many people reconsidered their working life, and 2020 saw a record number of new business start up companies . One of these is Cambridgeshire Hair and Beauty in March.

Lauren Slipper, hair and beauty specialist and Sean Brown, family friend and entrepreneur, have transformed a property on Gaul Road, March, into Cambridgeshire Hair and Beauty, helping to realise a dream for former Centre Parcs Spa Manager, Lauren.

Since it opened in July 2020, the business has soared, with hairdresser Abbie Evans joining the team to meet the demand. Lauren is already offering a host of new services, with hopes to set up a training school in the future.

Lauren said the challenges faced didn’t put her off investing in her own business:

“I’ve always wanted to have my own salon and when Sean approached me with the opportunity of being his business partner, I just knew it was the right time.”

Sean added: “It was obviously a difficult time to open but we did it without fear and since then we have just expanded rapidly, it’s been absolutely bonkers.”

The pair renovated the building next door to another of Sean’s businesses, Cambridgeshire Medical Aesthetics, with space for a hairdressing salon, reception area and beauty room.

Sean said support from Chris Goad, partner at Stephenson Smart, had been vital with opening a business during the pandemic.

“Chris has been brilliant. I can literally send him a text with a quick question, and he is always so helpful.

“With each business start up I have worked on Chris has guided me through the process and helped me with the business model. He’s also been so supportive throughout Covid and the different claims available to me.

“I haven’t had the need to worry about anything because I know Chris is always at the end of the phone with an answer.”

Starting up a new business is both an exciting and a challenging task, which carries with it an element of risk. Key decisions need to be made, and there are many factors to consider.

Stephenson Smart are specialist business start up advisors. We can guide you through the decision-making processes, help you make the appropriate registrations, assist with cash flow forecasts and offer regular updates to enable you to monitor the performance of your business. Please get in touch if we can support you on your new business start up journey.

Related pages: Business Start Up Advice

 

 

 

 

 

Spring Statement response by Kayleigh Wilson of Stephenson Smart

Spring Statement 2022

24th March, 2022, Kayleigh Wilson

Spring Statement

Against a backdrop of rising inflation, Chancellor Rishi Sunak presented his first Spring Statement on Wednesday 23 March 2022.

The Chancellor announced a cut in fuel duty for petrol and diesel as he sought to ease the impact of rising prices for households and businesses.

He will lift the starting thresholds for National Insurance contributions (NICs) and also pledged a cut to income tax in 2024. However, the Health and Social Care Levy will still be implemented in April 2022.

For businesses, there is an increase to the Employment Allowance, as well as relief from business rates on a range of green technologies and help with training and the adoption of digital technology.

Increase in the National Insurance threshold and Lower Profit Limit

There had been speculation that the Chancellor would try and make some kind of tax cut to answer his critics that he was not doing enough to ease the cost of living rises. His solution was to announce an increase in the annual National Insurance Primary Threshold and the Lower Profits Limit in his 2022 Spring Statement, to take effect from July 2022.

Primary Class 1 contributions are paid by employees. To align the starting thresholds for income tax and National Insurance contributions (NICs) the threshold will increase from 6 July 2022 from £9,880 to £12,570.

The Lower Profits Limit is the point where the profits of the self-employed become subject to Class 4 NICs. From 6 April 2022 the Lower Profits Limit is increased to £11,908 and from 6 April 2023 the limit is increased further to £12,570.

In addition, there will be no Class 2 NICs on profits between £6,725 and £11,908. £3.15 per week is payable where profits are over £11,908.

Temporary increase in National Insurance rates

The temporary increase in National Insurance rates (the Health and Social Care Levy) will still come into effect from April 2022.

There will be a temporary increase in the rates of NICs payable for employees, employers and the self-employed as a transitional provision in readiness for the introduction of the Health and Social Care Levy from April 2023.

With the increase to the thresholds announced in the Spring Statement, from 6 July 2022 employees earning between £242 (£190 from 6 April to 5 July 2022) and £967 per week will pay NICs at 13.25%. Earnings over £967 will attract a 3.25% charge. Employers will pay 15.05% on their employees’ earnings over £175 per week.

Although employees’ NICs only become payable once earnings exceed £242 per week, any earnings between £123 and £242 per week protect an entitlement to basic state retirement benefits without incurring a liability to NICs.

For the self-employed, where their profits exceed £11,908 per annum, they will pay 10.25% on the profits up to £50,270 and 3.25% on profits over that upper profits limit.

Income tax reduction

The Chancellor announced the reduction in the basic rate of income tax for non-savings, non-dividend income for taxpayers in England, Wales and Northern Ireland to 19% from April 2024.

The change will be implemented in a future Finance Bill.

Fuel duty

A welcome measure announced in the Spring Statement to help all motorists – individuals, small businesses and hauliers – fuel duty for petrol and diesel is cut by 5 pence per litre across the whole of the UK. This measure took effect from 6pm on 23 March 2022 and is in place for 12 months.

Increased Employment Allowance

Employers are able to claim the Employment Allowance which reduces their employer Class 1 NICs each year.

In the Spring Statement, the Chancellor announced an increase from April 2022 of £1,000 for eligible employers to reduce their employer NICs by up to £5,000 per year.

The allowance can be claimed against only one PAYE scheme, even if the business runs multiple schemes. Connected businesses, such as companies under the control of the same person or persons, are only entitled to one Employment Allowance between them.

VAT on energy saving materials

The Chancellor announced a UK wide, time-limited zero rate of VAT from April 2022 for the installation of energy saving materials. This will apply to installations such as rooftop solar panels.

This is in addition to the extension of the VAT relief to include additional technologies and the removal of complex eligibility conditions.

Green reliefs for business rates

The government is introducing targeted business rates exemptions for eligible plant and machinery used in onsite renewable energy generation and storage, and a 100% relief for eligible low-carbon heat networks with their own rates bill. It was announced in the Spring Statement, that these measures will now take effect from April 2022, a year earlier than previously planned.

Spring Statement Summary

These are the main highlights of the Spring Statement announcements by the Chancellor. An above average amount of changes to allowances and tax bands for a Spring Statement, some of which come into play very soon and will have an immediate effect on calculations.

At Stephenson Smart we are specialists in helping people navigate their business and personal finances.  You should contact us for advice before taking any action as a result of the contents of this response.

Related pages: Budget 2021

Omicron Business Support Available

James Rigato - Restaurant

13th January, 2022, Melanie Harriss

In response to restrictions imposed, the government have announced Omicron Business Support available to firms in the UK.

Omicron Business Support: Local Authority Grants

The first in a package of Omicron business support is for firms in the hospitality, leisure and accommodation sectors, many of which have seen a decline in footfall and increased cancellations due to the Omicron variant. These businesses are able to apply for one-off grants of up to £6,000 per premises depending on rateable value, via their local authority.

Further funds are also being given to local councils to support other businesses impacted by Omicron, such as those that supply the hospitality and leisure sectors as well as personal care services, these will be administered as Additional Restrictions Grants by local authorities.

Businesses eligible for Local Authority Grants are those that offer in-person services, where the main service and activity takes place in a fixed rate-paying premises, in the hospitality, leisure and accommodation sectors.

This includes businesses whose main function is providing a venue for the consumption and sale of food and drink, those that provide facilities linked to recreation and entertainment, as well as businesses whose main premise is used for holiday accommodation.

In the areas that our offices cover, these can be applied for with North Norfolk District Council, Fenland District Council, Borough Council of King’s Lynn and West Norfolk and Great Yarmouth Borough Council.

Omicron Business Support: Statutory Sick Pay Rebate Scheme

Further Omicron business support comes with the reintroduction of the Statutory Sick Pay Rebate Scheme for coronavirus-related absences for small and medium-sized employers.

Businesses could be eligible for support if they employed fewer than 250 employees on 30 November 2021, and have paid Statutory Sick Pay (SSP) to employees for coronavirus-related sickness absences.

Up to two weeks SSP can be claimed, if employees have been paid at the relevant standard weekly rate of £96.35, for any eligible periods of coronavirus-related sickness from 21 December 2021. This is a new claims period.

Businesses could claim to cover the costs for up to two weeks of SSP for an employee who takes time off because of coronavirus, regardless of whether they have claimed for that employee under the previous scheme.

Omicron Business Support: Culture Recovery Fund

Additional Omicron business support is a further £30 million of funding being made available through the Culture Recovery Fund. These grants support cultural organisations that have been affected by the Covid-19 crisis to stay afloat, providing them with support to ensure that they can survive and stay open.

The funding is accessed via Arts Council England.

Omicron Business Support: Time to Pay

HMRC still has its Time to Pay arrangement in place. This can be accessed if you are facing difficulty in making a tax payment; you can make an arrangement to pay what you owe in affordable instalments.

In order to access this support you need to contact HMRC, as arrangements are made on a case-by-case basis.

Related articles: Bounce Back Loan Repayment

Why employers should consider an apprenticeship scheme

Bethany Little: Part of Stephenson Smart Apprenticeship Scheme

6th January, 2022, Melanie Harriss

If your business is struggling to recruit, offering an apprenticeship or traineeship scheme might be the answer and could make someone’s New Year!

Part of the government’s Plan for Jobs to help the UK economy recover from the covid pandemic includes support for employers to take on trainees.

There are different schemes available:

Kickstart Scheme

The Kickstart Scheme, which has recently been extended to March 2022, aims to create 6-month job placements for young people who are currently on Universal Credit and at risk of long-term unemployment. The job placements are aimed at supporting the participants to develop the skills and experience they need to find permanent work after completing the scheme.

For each Kickstart job, the government will cover the cost of 25 hours a week at the relevant National Minimum Wage in addition to pension and National Insurance contributions for a period of 6 month. Employers will also receive £1,500 per placement to cover set-up costs and provide wraparound support for the young person.

Traineeship scheme

Traineeships are skills development programme for people of all ages that includes a work experience placement and gets people ready for employment or an apprenticeship.

Traineeships can last from 6 weeks up to 1 year and may include individual support in various methods of securing employment.

Employers who provide opportunities through a registered traineeship can use the scheme to recruit new talent into the business or help develop the skills of exiting employees. A business can also benefit from an employer incentive of £1,000 when a work experience placement of over 70 hours has been completed. This incentive can be claimed for up to 10 learners per region and employers can decide how to use the money.

Apprenticeship scheme

Apprenticeships employ people to do a real job while studying for a formal qualification – usually for one day a week either at a college or training centre. By the end of an apprenticeship, most people have gained the skills and knowledge needed to succeed in their chosen career.

There are two ways of accessing government funding to support an apprenticeship.

If an organisation’s wage bill is £3 million per annum or more, the organisation will pay a levy of 0.5% of the wage bill. Levy paying employers get a £15,000 allowance per annum to offset against the amount they have to pay.

If an organisation’s wage bill is under £3 million, you don’t have to pay the levy. Instead, the employer agrees a payment schedule with a registered training provider and pays 5% towards the cost of the apprenticeship training to them directly. The government will pay the remaining 95%.

At Stephenson Smart we believe in nurturing talent within our organisation and have an active apprenticeship scheme. We currently have 24 trainees working across our six offices.

One of our youngest trainees is Bethany Little, who is based at our King’s Lynn office.

Bethany came to Stephenson Smart straight from high school to embark on her accountancy career.

“I came for a week’s work experience while I was at school and really enjoyed it. I am now studying for a joint ACA/CTA qualification which will mean that I will not only be a chartered accountant but also a chartered tax advisor at the end of it.”

One of our newest trainees is Deborah Robinson, who is based at our March office.

Deborah, who grew up in Stevenage, moved over to train in accounting after a successful career in the equestrian industry running a riding school. Deborah said:

“I came to a bit of a crossroads and thought it would be good to try something else and after spending so long working outside an office with a roof over my head seemed quite appealing! I’m really enjoying it and everyone has been lovely and supportive, so I’m looking forward to learning and progressing.”

After successfully completing her AAT qualification, Deborah has now started the next stage of her study, ACA qualifications through the apprenticeship route.

Chris Goad, partner at Stephenson Smart’s March and Wisbech offices, commented:

“We have always had a strong apprenticeship scheme at Stephenson Smart and find great rewards in hiring new talent and nurturing them to become accounting professionals.”

“If your business, like many others, is struggling to recruit, offering a traineeship or apprenticeship scheme might be the answer.”

 

 

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