2023 – A year for resilience?

Firstly, we wish all our clients a healthy and prosperous New Year!

In 2022, despite the troubles with the economy, we have been amazed at the resilience of our clients and how they have energetically moved their businesses into new areas, products and services. Many of our clients have redesigned delivery and payment systems, moved their entire processes digital, accepted remote working and adopted to new technologies to survive and indeed prosper.

You have demonstrated to us how we can all readily adapt to a change in circumstances and have given us inspiration and optimism for the future. We hope that by this time next year we will be back to where we want to be, and the economy will return to some kind of normality again.

For January we are encouraging all clients to take time to prepare a 2023 Strategic plan and set up your targets for success! 

“A sailor without a destination will never get a favourable wind”

It is easier to get to your destination with a plan. We all know this simple truth. If you are driving from A to B it helps to know where B is and the direction you need to take.

If you have a vision of what you want your business to look like when it is “complete” then you are able to drive your business towards the vision and you can monitor how you are doing as you go along.

If you do not have a strategic plan, you could get blown around like flotsam in the sea, “this way and that way”, without any control.

If you agree it is hard to accomplish anything without a plan, let’s start thinking about putting one in place. A plan looks at all the things a business could do and narrows it down to the things it is actually good at doing. A strategic plan also helps you determine where to spend time, resources and money.

How do you do a strategic plan?

• Take time to review your own personal objectives – the business is there to provide you with what you want from life; do not forget this.
• Look at where you are now: your strengths, weaknesses, opportunities and threats, so you have a clear understanding of your position in the marketplace, the competition, your systems, the way you do things, what you are good at, and what you are not.
• Focus on where you want to be (say) in 2 years: what you want your business to look like when it is running profitably and successfully. Then you can determine your priorities – the big issues that you need to focus on. This is the strategic plan!
• Write down your vision and define what you must achieve and the actions you need to take. Monitor how you are doing each month, noting which actions have been completed and what needs to be done to keep you moving forward. 
• Allocate responsibility for taking the actions.
• Review and adjust your regular activities to keep you on track.

We have useful tools and checklists to help you analyse where you are now, set a strategy, agree actions, and monitor them. Please talk to us about how we can help you achieve your goals – we have helped many other businesses grow and succeed!

More time to prepare for Making Tax Digital for Income Tax Self-Assessment

The mandatory use of software for Making Tax Digital for Income Tax Self-Assessment is being phased in from April 2026.

Making Tax Digital (MTD) for Income Tax Self-Assessment (ITSA) was due to be phased in from April 2024. However, the government, recognising the current economic environment and the significant change that a transition to Making Tax Digital represents, has pushed this back to April 2026. In addition, the previously announced £10,000 threshold for self-employment and property income has been raised, as detailed below.

Under MTD for ITSA, businesses, self-employed individuals, and landlords will keep digital records, and send a quarterly summary of their business income and expenses to HMRC using MTD-compatible software. In response, they will receive an estimated tax calculation based on the information provided to help them budget for their tax. At the end of the year, they can add any non-business information and finalise their tax affairs. This will replace the need for a Self-Assessment tax return.

Making Tax Digital from April 2026

From April 2026, self-employed individuals and landlords with an income of more than £50,000 will be required to keep digital records and provide quarterly updates on their income and expenditure to HMRC through MTD-compatible software.

Making Tax Digital from April 2027

Those with an income of between £30,000 and £50,000 will need to do this from April 2027. Most customers will be able to join voluntarily beforehand, meaning they can eliminate common errors and save time managing their tax affairs.

Income below the £30,000 threshold

The government has also announced a review into the needs of smaller businesses, particularly those under the £30,000 income threshold. The review will consider how MTD for ITSA can be shaped to meet the needs of these smaller businesses and the best way for them to fulfil their Income Tax obligations. It will also inform the approach for any further rollout of MTD for ITSA after April 2027.

Mandating of MTD for ITSA will not be extended to general partnerships in 2025 as previously announced.

See: Government announces phased mandation of Making Tax Digital for ITSA - GOV.UK (www.gov.uk)

Safety net for Horizon Europe applicants extended

The UK government has extended the Horizon Europe guarantee to provide a financial safety net for successful Horizon Europe applicants. The guarantee will be in place to cover all Horizon Europe calls that close on or before 31 March 2023.

The extension will ensure that eligible Horizon Europe awardees will continue to be guaranteed funding, supporting them to continue their important work in research and innovation.

Eligible, successful Horizon Europe UK applicants will receive the full value of their funding at their UK host institution for the lifetime of the grant. Awardees will be able to remain in the UK to receive this funding, which will provide reassurance for future collaborations, and support UK researchers whether UK association to Horizon Europe is confirmed, or otherwise.

See: Apply for Horizon Europe guarantee funding – UKRI

Government extends Mortgage Guarantee Scheme

The Mortgage Guarantee Scheme will be extended by a year to the end of December 2023, helping people with 5% deposits on to the property ladder.

Under the scheme the government offers lenders the financial guarantees they need to provide mortgages that cover the other 95%, subject to the usual affordability checks, on a house worth up to £600,000.

Launched in April 2021, the scheme has already helped over 24,000 households. It was originally planned to close at the end of 2022 but will now be extended until the end of 2023.

See: Government extends Mortgage Guarantee Scheme - GOV.UK (www.gov.uk)

Know where your old stamps are?

Royal Mail are adding barcodes to their regular stamps. After 31 January 2023, regular stamps without a barcode will no longer be valid. You can either use up these stamps before this deadline or swap them for the new barcoded ones.

The stamps that are changing are the stamps (pictured below) that will be familiar to you. They feature the profile of Her Late Majesty The Queen on a plain coloured background.

See: https://www.royalmail.com/sending/barcoded-stamps

Consultation on R&D tax reliefs draft guidance

HM Revenue & Customs (HMRC) has published draft guidance ahead of the implementation of reforms to the Research and Development (R&D) tax reliefs on 1 April 2023

To ensure the guidance is as helpful as possible, HMRC is inviting comments from any individuals or organisations who make use of or provide tax agent services for R&D tax reliefs.

The guidance clarifies technical aspects of how the reforms will work in practice and includes a list of the additional information that will be required for claims.

See: Research and Development (R&D) tax reliefs - draft guidance - GOV.UK (www.gov.uk)

Customs Declaration Service exporter deadline extended

Following consultation with the border industry, exporters will now have until 30 November 2023 to move across to the Customs Declaration Service (CDS), 8 months later than previously announced.

After 30 November 2023, businesses will need to use CDS to make export declarations for goods they send out of the UK, as they already do for import declarations.

CDS has been running since 2018 and is already being used for making import declarations when moving goods into the UK.

The service will replace the Customs Handling of Import and Export Freight (CHIEF) service, representing a significant upgrade by providing businesses with a more user-friendly, streamlined system that offers greater functionality.

HMRC will provide further information about the timeline for CDS exports by the end of January.

See: Customs Declaration Service - GOV.UK (www.gov.uk)

Changes to flexible working requests

Employees in Britain will be able to request flexible working from day one of their employment, under new government plans to make flexible working the default.

Flexible working doesn’t just mean a combination of working from home and in the office – it can mean employees making use of job-sharing, flexitime, and working compressed, annualised, or staggered hours.

Workers on contracts with a guaranteed weekly income on or below the Lower Earnings Limit will also be protected from enforced exclusivity clauses, which restrict workers from having multiple employers.

The new legislation, backed in the government’s response to the Making flexible working the default consultation, will also remove the requirement for employees to set out the effects of their flexible working requests to employers.

See: Millions of Britons to be able to request flexible working on day one of employment - GOV.UK (www.gov.uk)

Visas for seasonal workers

45,000 visas for seasonal workers will be available for businesses this year, the UK Government confirmed, providing a lift for the UK’s horticulture industry.

The allocation will allow businesses to recruit foreign workers to come to the UK for up to six months through the Seasonal Worker visa route – an uplift of 15,000 compared to what was available to businesses at the start of 2022.

See: Government provides boost to horticulture industry with certainty over seasonal workers - GOV.UK (www.gov.uk)

Businesses to be given UK product marking flexibility

Businesses will be given an additional 2 years to apply new product safety marking.

The UK Conformity Assessed (UKCA) marking has been introduced as part of the UK’s own robust regulatory framework. It shows that products comply with product safety regulations which are designed to protect consumers.

However, given the difficult economic conditions the UK Government does not want to burden business with the requirement to meet the original 31 December 2022 deadline.

The UK Government will continue to recognise the CE marking for 2 years, therefore allowing businesses until 31 December 2024 to prepare for the UKCA marking. Businesses can also use the UKCA marking, giving them flexibility to choose which marking to apply.

See: Businesses to be given UK product marking flexibility - GOV.UK (www.gov.uk)

Help to Grow: Digital scheme

Help to Grow: Digital is a UK-wide scheme to help small and medium-sized businesses adopt digital technologies proven to increase productivity.

The scheme offers:

• free, impartial advice and guidance about what digital technology is best suited to your business and how it can boost your business' performance; and 
• targeted financial support, if your business is eligible, worth up to £5,000 towards the costs of buying approved digital technologies.

Help to Grow: Digital will close to new business applications for discounts on 2 February 2023. Discounts issued for eligible software must be redeemed within 30 days from issue date.

See: Final opportunity for businesses to access Help to Grow: Digital scheme - GOV.UK (www.gov.uk)

Funding for novel, low-emission food production systems

Part of Innovate UK’s Plan for Action, this competition aims to support the development of novel production systems that create new sources of resource efficient, low-emission foods, particularly proteins, while delivering healthy and sustainable diets.

To be eligible, projects must progress emerging novel food production systems towards commercial viability and ability to supply mainstream consumer markets.

Projects must have the potential to significantly shift the current state of the art in one or more of the following six priority areas:

• plant based products or production systems;
• acellular food production, for example, algal, bacterial or fungal fermentation systems;
• cellular food production, for example, cell culture systems for meat production;
• novel aquaculture systems, for example, fin-fish and shell-fish;
• new food production systems, for example, insect farming, seaweed cultivation and other alternatives to traditional animal production systems; or
• Total Controlled Environment Agriculture (TCEA) systems.

The competition opens on 18 January and closes on 19 April 2023.

For feasibility studies see: Competition overview - Novel, low-emission food production systems: Feasibility studies - Innovation Funding Service (apply-for-innovation-funding.service.gov.uk)

For industrial research see: Competition overview - Novel, low-emission food production systems: Industrial research - Innovation Funding Service (apply-for-innovation-funding.service.gov.uk)