In the News
Recession Proofing Your Business
At Warings we believe that now is a good time to take note of the various forms of help available to businesses and also consider the impact of recent legislation changes that have come to light in the Chancellor’s budget.
Government Assistance
HM Revenue & Customs ‘Business Payment Support Service’ is a key tool within a business’s armoury in seeing out the recession. However, whilst being well promoted by the Government, our experience is that there seems to be a lack of takers to the service.
The service allows you to spread Crown payments of PAYE, VAT and/or Corporation Tax over an extended period in order to ease cashflow pressures in these difficult times. Interest is charged on amounts outstanding but there are no arrangement fees which you would typically expect to pay when renewing bank debt for instance, which makes this a more attractive option than first meets the eye.
Extended Loss Relief Period
A little ray of sunshine coming out of the Chancellor’s budget is the extension of the loss relief period in which companies can carry back to the preceding three years.
Now, any trading losses incurred by a company during accounting periods ending 24 November 2008 to 23 November 2010 (previously 23 November 2009), will be available for relief against taxable profits of the prior three years. Losses will be offset against most recent periods first.
A twelve month carry back claim follows normal loss relief rules, whilst a claim against earlier years is subject to a £50,000 cap. Nevertheless for some companies this equates to an additional £15,000 maximum refund on top of any ‘normal’ loss carry back.
This cash injection may prove invaluable to businesses and is relatively easy to obtain for those in a loss making position.
Furthermore, in some instances it will also be possible to secure favourable relief by adjusting a company’s accounting reference date to end before 23 November 2010.
For further details on any of the above or to discuss how other budget reforms affect you and your business, please don’t hesitate to contact our highly skilled team of dedicated professionals here at Warings Chartered Accountants.
30th April 2009