Month: January 2023

All business owners, but predominantly retailers, leisure and entertainment trades, will have seen their hard-won capital all but exhausted by the needs to meet fixed costs when income generation has been restricted or eliminated by lock-down directives during the early years of the COVID pandemic, and more recently by the downturn in global trade due to the war in Ukraine, inflation, rising interest rates and increases in energy costs.

In the face of these challenges what can beleaguered business owners do to protect their capital base and be in a position step back into the ring as and when consumers start to edge out of their front doors and start spending?

Here’s a few ideas for you to think about:

1. List all of your fixed costs, those that you have to pay even if you have no income coming in and cancel as many as you can that can be re-established when markets open up again. Obviously, many will be tied to contracts that cannot be broken. In which case:
2. Contact suppliers, landlords, service providers etc., and see if you can negotiate a moratorium on payments for a period, a reduction in payments or the cancellation of contracts.
3. When this work is done rework your business plan for the next year and speak to your bank or other sources to secure any cash required to meet the likely dips in cash resources.
4. Importantly, start to think about waking up your business when consumer interest in spending starts to increase demand for your goods or services.

And finally, speak to us. There is no substitute for sharing this planning process with your professional adviser. We know your business. We know how you have burned the midnight oil to develop your business and the problems you have overcome along the way. We can, and we want to help. Cal now so we can start to unravel your options.

The new business Energy Bills Discount Scheme will replace the current Energy Bill Relief Scheme which is coming to an end on 31 March 2023. The new scheme will offer support to eligible non-domestic energy customers, including UK businesses, the voluntary sector – such as charities – and the public sector – for example, schools and hospitals – from 1 April 2023 to 31 March 2024.

The new scheme has been designed to help support businesses over the next 12 months whilst at the same time limiting the taxpayer’s exposure to volatile energy markets. A cap has been set at £5.5 billion based on estimated volumes.

Under the new scheme, eligible non-domestic customers who have a contract with a licensed energy supplier will see a unit discount of up to £6.97/MWh automatically applied to their gas bill with a price threshold of £107 per MWh and a unit discount of up to £19.61/MWh applied to their electricity bill with a price threshold of £302 per MWh. The relative discount will only be applied if wholesale prices are above the stated price thresholds.

The government has also confirmed that a substantially higher level of support will be provided to businesses in sectors identified as being the most energy and trade intensive – predominately manufacturing industries. These businesses will receive a gas and electricity bill discount based on a supported price which will be capped by a maximum unit discount of £40/MWh for gas with a price threshold of £99 per MWh and £89/MWh for electricity with a price threshold of £185 per MWh. This discount will only apply to 70% of energy volumes.

As with the original scheme, suppliers will automatically apply reductions to the bills of all eligible non-domestic customers.

Leaving politics to one side, how can we deal with the current pressures on businesses? Rising costs, reducing revenues as the cost-of-living issues impact activity, increasing taxes – Corporation Tax will include a main rate of 25% from the 1 April 2023 – and a background of continuing supply difficulties.

At this time of the year many of us are also required to make Self-Assessment tax payments.

According to Age UK, we are a nation of worriers who find it difficult to share our problems. These can range from financial concerns as well as other stress creating issues.

But top of the bill – over 50% of the population – are concerns over money problems.

We can help…

As well as keeping business owners up-to-date with their filing obligations we can also advise on a whole range of topics that are likely to play on the minds of entrepreneurs.

Our successes over many years, in helping clients, means that we have a wealth of experience that can be shared with you to have a positive impact on your business affairs.

Pick up the phone. Let’s discuss your options and see if we can help you resolve your difficulties; see if sharing your problems will open up new possibilities.