Poll: Business calls for infrastructure boost as Spending Review looms

With the Chancellor poised to unveil the latest round of spending cuts, a leading business group has reiterated its call for the Government to boost investment in infrastructure and protect growth.

The Confederation of British Industry (CBI) is urging George Osborne to ‘bridge the infrastructure investment gap’ and kick-start flagship building projects over the coming years.

‘The Chancellor must prioritise areas that could propel a fledgling recovery and infrastructure investment should be in pole position,’ said CBI Director-General, John Cridland.

He continued, ‘We need quick and decisive action on the big decisions that will move projects from blueprints to building. The Government must bridge the investment gap making sure infrastructure spending is a priority in the years ahead.’

In its submission to the Chancellor, the CBI also called for an extension of the UK guarantee schemes beyond 2014, together with a new skills tax credit to invest in the future workforce.

George Osborne is expected to outline £11.5bn in government cuts when he delivers the Spending Review to the House of Commons later today.

While budgets for the NHS, schools and overseas aid will be ring-fenced, most other government departments will have to bear spending cuts of between 8% and 10% in 2015-16.

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Further information on the Spending Review can be found on the Treasury’s website.

Ben Korklin joins Lawrence Grant as a new Partner

Lawrence Grant, Chartered Accountants are very pleased to announce that Ben Korklin, sole practitioner, will be joining as partner with effect from 1st May.

Ben brings with him an established and growing client base having started his own firm Benjamin Alan in 2010.

Paul Levy, senior partner at Lawrence Grant says “Ben’s modern, fresh and innovative approach will be a key asset to our firm and will complement our core values. His ability to help clients grow their business in a difficult economic environment and his track record in establishing his own practice in such a short period of time make him an excellent addition to our team. We view his appointment as a continuing sign of our commitment to being a driving force within the industry.

 “I am confident that Ben will play a vital role in growing our existing client base, and in addition, develop new opportunities within our ‘specialist accountancy services’ which currently include Legal, Dental and Medical professionals to now encompass the Media and Beauty sectors which Ben will be bringing with him.”

Ben Korklin says “I am very excited to be starting a new challenge at Lawrence Grant and look forward to working with the other partners and staff.  I am very fortunate to be joining such a respected firm that prides itself on providing top quality accountancy services.”

For further information, or to arrange an interview with Paul Levy or Ben Korklin, please contact Paul Atkinson, Marketing Manager at Lawrence Grant on 020 8861 7575

Business backs new cap on unfair dismissal

Business groups have welcomed a package of measures designed to reduce workplace disputes, including a proposed cap on unfair dismissal payments.

Publishing its response to the consultation ‘Ending the Employment Relationship’, the Government has confirmed that, subject to state approval, the maximum compensatory award for unfair dismissal will be restricted to one year’s salary.

However, there are no plans to change the overall limit of the cap, which currently stands at £72,300 and is due to rise to £72,400 in February.

According to the Department for Business Innovation & Skills, just one in 350 people who make a claim for unfair dismissal receive an award of more than their own salary, and the average award is less than £5,000.

The Government will also consult on proposals to reduce Transfer of Undertakings (Protection of Employment) or TUPE burdens on business, along with plans for a new ACAS Statutory Code for settlement agreements.

The proposals have been welcomed by business groups. Neil Carberry, CBI director of employment, said: ‘The current cap on unfair dismissal payouts is many times higher than the average sums awarded, giving workers unrealistic and inflated expectations of what a claim is worth.

‘It’s right that the new cap is linked more explicitly to an employee’s earnings. This will give businesses clarity about the potential costs and will scrap the perverse incentive for workers not to settle in the hope of getting a higher award.’

Meanwhile, Dr Adam Marshall, Director of Policy and External Affairs at the British Chambers of Commerce, commented: ‘As always, the devil is in the detail, but these proposed measures are fair and should reduce stress, uncertainty, and delay for both employee and employer.

‘The proposed cap will make employers more confident in recruiting and also in defending themselves, if accused of ending employment unfairly’.

Should an employer’s liability be limited to a maximum of 12 months pay if a worker has been unfairly dismissed?

Or what if workers are under-perfoming, driving  away business, they could risk making others redundant in the process?

What do you think? We’d love to hear your thoughts

 

 

Further business rates rise could lead to staff cuts

Further business rate rises would leave 70% of retail businesses facing staff cuts, according to research conducted by the British Retail Consortium (BRC). The BRC also found that a 2.6% planned rise in rates would be equivalent to £175 million extra in costs for these companies.

The BRC says that rates have already risen dramatically – by 4.6% in 2011 and 5.6% in 2012 – despite the poor performance of the economy in general and the retail sector in particular.

Questioning retail chief executives, the BRC found that further rises would lead to the majority cutting back on investment in stores, with 15% saying they would expect to close outlets as a result.

BRC director-general Stephen Robertson said, “MPs who care about their constituencies will recognise the importance of their high streets and the need to take action to prevent more shops falling empty. They will want to avoid the blow to investment and job creation that chief executives tell us would come from a third successive huge hike in business rates.”

At Lawrence Grant, we have developed a wide range of skills and services designed to not only improve business performance and profitability but also to monitor your finances continually to give you proactive advice on how you can improve on your bottom line.

If you would like to talk about any tax advice you may need or would like to take advance of our FREE initial consultation, please contact us on 0208 861 7575 and you will be put through to the relevant business partner. You can find even more information on our website as well.

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Those all important inflation numbers

Traditionally, the inflation rate for September has set the level of increase for tax bands, tax allowances and social security benefits to take effect from the following April.

While the September date remains unaltered, the coalition Government has made several changes to the measures of inflation used or, in some instances, just suspended inflation proofing. Indeed, there is still a possibility that when the Chancellor gives his Autumn Statement on 5 December he will announce sub-inflation or nil increases for some benefits.

However, assuming that inflation-linking is left to run its course and no other revisions emerge, there are some things we are already sure of.

• A single person’s basic state pension will rise by 2.5% to £110.15 from April 2013. The 2.5% is not actually an inflation number, but stems from the ‘triple lock’ introduced by the coalition agreement. This says that pensions must rise by the greater of Consumer Prices Index (CPI) inflation, earnings inflation and 2.5%. With CPI inflation running at 2.2% in September and earnings growing most recently at 1.7%, the flat 2.5% wins.

• Other state pension benefits, such as the additional state pension (SERPS and S2P) will rise in line with the CPI.

• Most other state benefits will rise in line with CPI. However, Child Benefit will be frozen for a third year and in 2013/14 the full impact of the new child benefit tax will be felt (it starts on 7 January 2013).

• The income tax personal allowance will not be index-linked for 2013/14, but instead will rise to £9,205. At the same time the basic rate band will shrink to £32,245, as announced in the March Budget. Next tax year, age-related allowances will be frozen as part of the controversial move to phase them out. The ISA limit will rise to £11,640 and the capital gains tax annual exemption to £10,900, both in line with the CPI plus specific rounding adjustments.

A year ago the Chancellor had the misfortune to hit the peak of inflation (5.2% for the CPI) for benefit increases. On this occasion he may have hit the low point. From October, a new round of utility price increases will kick in, as will the impact of the jump in student tuition fees to £9,000. Inflation is therefore likely to be higher by the end of 2012.

The Chancellor cannot afford to ignore inflation in his financial planning, and nor can you. It may appear to be just small percentages each year, but the cumulative impact is insidious. For example, over the last ten years the buying power of £1 has fallen to 72.7p, while even the last five years have seen it shrink to 85.2p.

If you would like any assistance with year round tax advice, or take up our offer of a FREE initial consultation, please call us on 0208 861 7575 or for more information visit our website

Lawrence Grant, Chartered Accountants launches its very own Accountancy App.

Lawrence Grant, Chartered Accountants is pleased to announce the launch of its very own android and iphone app.

The App can be used as a quick reference guide to check the latest tax rates and legislation for the current year, and is instantly available in the UK and worldwide.

As tax is a vital aspect of any business whether it’s an individual, sole trader or a company, we offer an extensive ‘Tax Updates’ section detailing all relevant tax information for the current tax year as well as a comprehensive list of our accountancy services.

Kassim Harunani, a partner at Lawrence Grant, says “We as a firm are very passionate about technology and how it can be used to enhance the relationship with our clients and in addition, enable us to provide them with the best possible service and up to date information. It is very important for us to be at the forefront of our existing clients minds’ to have accessible information wherever they may be. With a strong International client base also, this is both an exciting and ideal platform to meet all of these needs.”

 “The package offered by our App service provider enables us to manage the content, which is ideal, as we can reflect changes in tax legislation very quickly and provide our clients with the most current and relevant information, with additional functionality available as and when required. Anyone interested in creating a similar app for their business, please get in contact.”

“We have already received some very good feedback about the app, and the suggestions of new features have been very useful as well.”

Click here to download our app using the Android platform

Click here to download our app using the iphone platform

For further information, or to interview Kassim Harunani, please contact Paul Atkinson, Marketing Manager at Lawrence Grant on 020 8861 7575

The Government announces new measures to ‘transform consumer rights’

The Department for Business, Innovation and Skills has published a consultation on new measures which are set to deliver ‘greater clarity and transparency’ on consumer rights.

The Consumer Rights Directive, which was agreed by the European Commission in 2011, aims to ‘boost the confidence’ of consumers and businesses by ensuring that customers have access to accurate information when purchasing goods and services, including details of the full costs involved and the implications of any contract they may be entering into.

The Directive includes provisions on the following areas:

• The information that is provided before a consumer buys goods or services, both at the trader’s premises, and when away from the trader’s premises
• Cancellation rights and responsibilities where goods or services are purchased away from the trader’s premises
• The delivery times for goods, including clarification of deadlines and responsibilities
• Additional payments, applied on top of the main price of a purchase, which would require the express consent of the consumer (with ‘pre-ticked’ consent boxes set to be outlawed)
• The fees charged for a particular method of payment, such as credit card surcharges

Commenting on the new consultation, Consumer Affairs Minister Norman Lamb said, ‘The Consumer Rights Directive will put an end to certain bad business practices and help consumers make well-informed decisions when buying products or services. It will also boost business confidence, setting out clearer rules and responsibilities and cutting red tape by reducing compliance costs’.

The consultation can be viewed here: www.bis.gov.uk/consultations.

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Scrapping Sunday trading laws ‘is no magic answer’

Government plans to consider relaxing Sunday trading laws on a permanent basis have sparked criticism from groups opposing the measure.

Current legislation means that shops with a floor space of more than 3,000 square feet are normally limited to a maximum trading time of six hours on a Sunday, between the hours of 10am and 6pm.

However, for the duration of the Olympic and Paralympic Games, supermarkets and larger stores have been able to enjoy extended trading hours.

At the time of the extension, the Government stated that it was not considering making the temporary relaxation more permanent.

However, communities secretary Eric Pickles has more recently commented that he is willing to consider looking at the impact of the relaxation on trade.

Responding to the news, the chief executive of Sainsbury’s, Justin King, said, ‘Maintaining Sunday’s special status has great merit for our customers and our colleagues, and relaxing Sunday Trading laws is certainly not a magic answer to economic regeneration’.

Meanwhile, the workers’ union Usdaw and the Association of Convenience Stores have commented that longer opening hours ‘won’t put more money in the pockets of shoppers’.

In a joint letter to the Sunday Telegraph, the organisations warned that ‘with margins being squeezed and sales flatlining, the last thing the retail sector needs is increased overheads for little or no return’.

 If Tax Matters To You, YOU Matter To Us

SMEs ‘benefit from recession-busting measures’

Despite the challenges posed by the tough economic climate, over a third of SMEs have reaped the benefits of cost-cutting measures introduced in a bid to combat the recession, a new report suggests.

Nearly four in ten business owners reported that the recession had prompted them to re-evaluate their business processes and reduce costs, and that the business had continued to benefit from the streamlining measures put in place.

In addition, a third of business owners said that the process of re-evaluation had given them a better understanding of the business, while a fifth reported that they are now enjoying more favourable rates from suppliers.

However, the impact of the double-dip recession remains a cause for concern, with generating new business and the rising costs of fuel and materials being among the principal areas of concern for business owners.

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We can help you to make the most of your business and your personal finances. Please contact us for further advice and assistance.

Business group welcomes planned return to O-level style qualifications

The Federation of Small Businesses (FSB) has welcomed Government proposals that would see a scrapping of GCSEs, and a return to a system similar to the former O-level.

The business group believes that scrapping GCSEs will lead to an increase in standards among core subjects, including English, maths and science.

The news follows long-standing media speculation over whether educational standards have dropped in recent years, with some alleging that competition for business among examination boards has prompted a ‘race to the bottom’.

Alex Jackman, Senior Policy Adviser at the FSB, said, ‘We know businesses have long felt let down by the current GCSE system, which in far too many cases has failed to teach youngsters even the most basic of skills in reading, writing and arithmetic’.

‘Most businesses don’t need staff with a GCSE in global citizenship or needlework, they need work-ready employees who can write a properly punctuated sentence free from spelling mistakes, and mentally able to work out a simple maths problem.’

However, Mr Jackman also highlighted the role played by vocational courses, and urged the Government not to concentrate on academic subjects alone.

If Tax Matters To You, YOU Matter To Us.

If you would like to talk to us about any accountancy needs, please contact us on +44 (0)20 8861 7575, or visit our website at www.lawrencegrant.co.uk