Businesses feel 'jaded' and brace for further strain on finances ahead of Autumn Statement
A leading Warwickshire accountant says he is not expecting any tax cuts or immediate support for businesses and that clients are feeling ‘jaded’ ahead of the Autumn Statement.
Sean Farnell, Partner at accountancy firm Burgis & Bullock, says that with tax cuts unlikely, businesses are readying themselves for further strain on their finances – with an increase in the National Living Wage set to be confirmed as part of the statement.
Plans were unveiled at the Conservative Party Conference in October to raise the National Living Wage for workers aged 23 and over to at least £11 an hour, with the change coming into effect in Spring 2024.
Sean expects there to be limited major announcements during the Chancellor’s statement on Wednesday, November 22, and said that the firm’s clients are already keeping one eye on the announcement of potential tax cuts in March next year.
He has suggested that there may be a further delay to Making Tax Digital for Income Tax Self-Assessment (ITSA), while there may also be closer reviews announced into umbrella companies and IR35 rules (off-payroll working).
“Businesses are feeling jaded and that is something which is reflected in our client base too,” said Sean.
“People aren’t expecting any fireworks in the Autumn Statement and, in the absence of any major announcements, are already keeping a beady eye on what may be announced in The Budget next year.
“The increase in the National Living Wage is coming. It is of course great news individuals, but not so much for small businesses who are already struggling more than ever before. An increase in the living wage has a knock-on effect throughout an organisation, it will be a big strain for a small and medium-sized business.
“Businesses have been dealing with increases in costs over the last few years, particularly when you look at fuel, energy and then the increases in corporation tax. There is a question of at what stage will these strains become unaffordable.
“We hope that there will be a further review in business rates, with a focus on extending and enhancing the benefits for the hospitality industry. Hospitality businesses are essential to vibrant towns and cities, the Government should be looking to all they can to support these businesses.
“There are murmurs that there will be a further tightening of restrictions on research and development tax credits for SMEs, which will further discourage investment, innovation and growth.
“Inheritance tax is a constant topic of discussion ahead of Government announcements recently, but we would not expect any announcement on that this month, however there could be a review unveiled.
“It’s quite possible there will be closer reviews into umbrella companies and IR35 rules, with all signs also pointing towards a further extension of the deadline for Making Tax Digital, as HMRC continues to work to ensure it has the appropriate software in place to support the transition.”
Burgis & Bullock has offices in Leamington Spa, Nuneaton, Rugby and Stratford-upon-Avon.
