Your Essential Business & Finance Update – Monthly Newswire

Welcome to our latest Monthly Newswire!

We hope you find this newsletter both informative and valuable. If you have any questions or would like to discuss any of the topics covered, please don’t hesitate to contact us. We’re here to help!

Get Britain Working White Paper

Reforms to Employment Support Announced

The UK government has introduced a series of employment support reforms, backed by a £240 million investment, as outlined in the Get Britain Working White Paper. These reforms aim to tackle unemployment, economic inactivity, and barriers to work, addressing the alarming statistics highlighted in the announcement:

• 1.5 million people are unemployed
• 9 million are economically inactive
• 2.8 million are out of work due to long-term illness
• 1 in 8 young people are not in education, employment, or training.

The White Paper focuses on modernising the employment support system to better respond to these challenges and revitalise the workforce.

Key Reforms

1. Revamping Jobcentres

Jobcentres will be transformed into a “national jobs and careers service“, shifting the focus from monitoring benefits to developing skills and careers.

1. Addressing Economic Inactivity from Ill Health

• Extra NHS staff will be deployed in 20 areas with high inactivity to reduce waiting lists.
• Expanded mental health support to help individuals return to work.

1. Youth Guarantee

• Every 18-to-21-year-old will have access to apprenticeships, training, or education opportunities.
• The Apprenticeship Levy will replace a more flexible Growth and Skills Levy.
• Eight youth “trailblazer” areas, including Liverpool, Tees Valley, and the East Midlands, will pilot new approaches to help young people find work or training.

1. Support for People with Disabilities and Health Conditions

• A review of employer roles will explore how businesses can promote inclusive workplaces and retain employees with disabilities or health conditions.
• Early intervention for sickness absence will be examined to encourage faster returns to work.

1. Empowering Local Communities

Local leaders in areas not receiving trailblazer support will receive up to £15 million to design tailored solutions for employment challenges.

Impact of the Reforms

• For Employers: New obligations may emerge for managing long-term sickness and promoting inclusive workplaces.
• For Businesses: More young people receiving quality training could increase the availability of skilled workers, addressing recruitment challenges.

You can review the Get Britain Working White Paper here to learn more.

Be Wary of Self Assessment Scams

Scam Attempts on the Rise

With the 31 January 2025 Self Assessment deadline approaching, HM Revenue and Customs (HMRC) has warned of a rise in scam attempts targeting taxpayers. Over the past year, nearly 150,000 scam reports were referred to HMRC a 16.7% increase compared to the previous year.

How Do Scammers Operate?

Fraudsters often claim to represent HMRC, aiming to steal personal information or banking details. Around half of the scams reported involved fake tax rebate offers.

Key Scam Tactics:

• Emails, texts, or calls offering tax rebates or requesting personal details.
• Threatening voicemails claiming legal action or arrest.
• Phishing links are designed to trick recipients into sharing sensitive information.

How to Spot a Scam

HMRC will never:

• Leave voicemails threatening legal action or arrest.
• Ask for personal or financial information via text or email.
• Contact you to announce a refund or ask you to claim one.

Use HMRC’s scam identification checklist here for more guidance.

What Should You Do?

• Ignore and report suspicious messages or calls.
• Contact HMRC directly if you’re unsure about any communications.
• If you need help verifying whether you’re due a refund, please call us we’re here to assist.

Stay vigilant and protect your personal information.

New Fair Payments Code Launched

Will It Help You Get Paid Quickly?

The government has introduced the Fair Payments Code to address the persistent issue of late payments, particularly impacting small businesses. This initiative is designed to encourage businesses to commit to fair payment practices.

How Will the Fair Payments Code Work?

The Code uses a gold, silver, and bronze award system to identify businesses that meet fair payment standards. Here’s how the system works:

• Gold Award:
  • At least 95% of invoices are paid within 30 days.
• Silver Award:
  • At least 95% of invoices are paid within 60 days.
  • At least 95% of invoices to small businesses are paid within 30 days.
• Bronze Award:
  • At least 95% of invoices are paid within 60 days.

Businesses achieving these awards must also commit to the principles of being “Clear, Fair, and Collaborative“ with their suppliers.

Accountability and Enforcement

• Award Duration: Awards last two years and must be renewed afterwards.
• Complaint System: A robust system allows businesses to report partners who fail to meet their award obligations or violate the Code principles.

How Can This Help You?

The Fair Payments Code offers small businesses:

• Transparency in identifying reliable business partners.
• A tool to address the challenge of late payments, which can affect cash flow.

While this initiative is a step in the right direction, there are additional strategies you can use to ensure quicker payments.

If you’d like practical advice on improving your business’s payment collection process, get in touch we’re here to help!

Coffee Bean Prices Hit Record High

Will Our Morning Caffeine Fix Cost More?

Coffee lovers may need to brace themselves for higher costs as coffee prices on international commodity markets have reached record highs.

What’s Driving the Price Surge?

• Arabica Beans: Prices increased to $3.44 per pound in December, up by 80% this year.
• Robusta Beans: Also hit record highs in September.
• Weather Disruptions:
  • Brazil (largest Arabica producer):
    • The worst drought in 70 years (August–September).
    • Followed by heavy rains in October.
  • Vietnam (major Robusta producer):
    • Affected by both drought and severe rainfall during 2025.

Growing Demand for Coffee

The popularity of coffee continues to rise globally:

• In China, coffee consumption has doubled over the past decade despite not being a traditional coffee-drinking nation.

How Might This Affect Consumers?

In recent years, major coffee roasters have absorbed price increases to retain customers and maintain market share. However, experts warn that rising costs may soon be passed on to consumers.

If you’re in the hospitality or retail sector, now might be a good time to evaluate your pricing strategy or explore alternative sourcing options. Contact us for advice on managing supply chain challenges or pricing adjustments for your business!

New Reporting Requirements for Online Platforms

HMRC Confirms No Change to Tax Rules

Starting January 2025, online platforms like eBay, Airbnb, and similar services will begin sharing user sales and personal data with HM Revenue and Customs (HMRC).

What Does This Mean for Online Sellers?

• No Tax Due for Casual Sellers:
  • Selling unwanted items occasionally does not mean you owe tax.
  • Angie MacDonald, HMRC’s Second Permanent Secretary, clarified:
  • “If you are not trading and just occasionally sell unwanted items online, no tax is due.”
• Who Will Be Affected?
  • If you sold 30+ items or earned around £1,700 in 2024, you’ll receive a notification in January.
  • This notification will confirm that your sales data and personal details will be shared with HMRC.

When Do You Need to Pay Tax?

You may need to register for Self Assessment if any of the following apply:

1. Trading Activities:
   • Buying goods to resell or making goods intending to sell at a profit.
2. Providing Paid Services:
   • For example, delivery driving or renting out a holiday home.
3. Income Threshold:
   • If your total income (before expenses) exceeds £1,000.

What Should You Do?

If you’re unsure whether you need to register for Self Assessment or pay tax, we’re here to help! Contact us to review your situation and ensure you comply with HMRC’s rules.

Scottish Budget 2024/25: Key Highlights for Businesses

On 4 December, Shona Robinson, Cabinet Secretary for Finance & Local Government, delivered the Scottish Budget, focusing on priorities like eradicating child poverty, growing the economy, tackling the climate emergency, and ensuring sustainable public services.

Key Measures for Businesses

1. Income Tax Rates:
   • No increases or new bands for the remainder of this parliament.
   • From April 2025, thresholds for the Basic and Intermediate rates will rise 3.5%.
   • Higher, Advanced and Top rate thresholds will remain frozen.
2. Business Rates:
   • The introductory Property Rate will be frozen at 49.8p.
   • 40% relief for hospitality premises liable for the Basic Property Rate, capped at £110,000 per business.
3. Land & Buildings Transaction Tax (LBTT):
   • Rates and bands for residential and non-residential LBTT remain unchanged.
   • Additional Dwelling Supplement (ADS) will increase from 6% to 8% starting 5 December 2024 unless legal missives are signed before 4 December.
4. Landfill Tax:
   • Rates will increase from 1 April 2025 to align with the rest of the UK.

Feel free to reach out if you’re unsure how the Budget impacts your business or personal finances. We’d be delighted to help you understand and plan accordingly!

Welsh Budget 2024/25: Key Highlights for Businesses

On 10 December, the Welsh Government announced its Budget, which includes significant updates for businesses and individuals.

Key Measures

1. Welsh Rates of Income Tax

• The Welsh income tax rates for 2025/26 remain unchanged at 10p for all three rates (Basic, Higher, and Additional).
• Welsh taxpayers will continue to pay the same income tax as those in England and Northern Ireland.

2. Land Transaction Tax (LTT)

• Higher residential rates of LTT increased by one percentage point across all bands, effective 11 December.
  • Purchasers who exchanged contracts before this date may still qualify for the former rates under transitional rules.
• The higher residential rates are now five percentage points above the central ones.
• The main residential rates threshold remains at £225,000, covering around 60% of transactions exempt from LTT.
• Changes to Multiple Dwellings Relief (MDR):
  • Taxpayers using the Subsidiary Dwelling Exemption (SDE) will now pay the main residential rates without benefiting from MDR.
  • Further adjustments to MDR are expected in the coming year.
• Extension of LTT unique tax sites relief to include the Ynys Môn Freeport, subject to Senedd approval in January 2025.

3. Landfill Disposals Tax (LDT)

• The standard rate increased to £126.15 per tonne from 1 April 2025, matching the UK equivalent.
• The lower rate increased to £6.30 per tonne (5% of the standard rate), nearly double the current rate.
  • This adjustment aims to discourage landfill waste, with potential future increases if reductions do not meet government targets.
• The unauthorised rate (150% of the standard rate) increases to £189.25 per tonne.
• The ultimate goal is to support Wales’ ambition of becoming a zero-waste nation by 2050.

If you’re unsure how these changes might affect your business or personal finances, contact us for personalised advice and support. We’re here to help!