Welcome to the March 2023 Newsletter from Walsh & Co

With the Spring Budget just round the corner, the British Chambers of Commerce (BCC) has warned the government that four key areas require urgent action, including energy costs, childcare, business rates and green funding.  

Meanwhile, the Association of Taxation Technicians (ATT) has cautioned that 'arithmetic intricacies' in relation to the permanent increase in the Annual Investment Allowance (AIA) could 'catch businesses out'.

Spring Budget 'must hit four key targets', warns BCC

The British Chambers of Commerce (BCC) has outlined four goals Chancellor Jeremy Hunt should hit in the upcoming Spring Budget.

The BCC highlighted energy costs, childcare, business rates and green funding as the four key areas that require urgent action from the government. These four 'non-negotiables' form part of the BCC's Budget submission, which it has delivered to the Treasury.

It has called for the Chancellor to make childcare more affordable for parents and guardians; boost UK start-ups by reforming the business rates system; provide extra funding to help firms become more energy efficient; and set a framework for Solvency II investment that helps direct funds to where they can have the most impact.

'The last three years have put UK business under huge stress, and we urgently need to see coherent policies from the government that set the economy on a path to growth,' said Shevaun Haviland, Director General of the BCC.

'We need to unlock the potential of our start up and scale up firms by giving them some certainty on the future and relieving the upfront cost pressures that strangle their ambition before they can get off the ground.

'Chambers are already developing their own accelerators to help firms invest in greener and more energy efficient technologies and systems, but the government needs to do more.'

The Chancellor will present the Spring Budget on 15 March.

'Arithmetic intricacies' of Investment Allowance could catch firms out, ATT warns

The Association of Taxation Technicians (ATT) has warned that 'strange arithmetic intricacies' associated with the permanent increase in the Annual Investment Allowance (AIA) could catch out businesses.

During the 2022 Autumn Statement Chancellor Jeremy Hunt permanently increased the AIA to £1 million from 1 April 2023. It has been at this level since 1 January 2019, but was originally only intended to be a temporary measure.

The ATT is calling for the government to amend its draft legislation to make sure businesses with accounting periods that straddle the 1 April 2023 date are entitled to the full AIA across any 12-month period.

Presently, firms with accounting periods running both before and after April 2023 will only be eligible for a pro-rata portion of the allowance in each period.

Commenting on the issue, Jon Stride, Vice Chair of the ATT's Technical Steering Group, said: 'The absence of any change in the annual investment allowance limit between 31 March and 1 April 2023 might have been expected to avoid the strange arithmetic intricacies associated with the ending of a temporary increase.

'However, the legislation includes requirements concerning the second straddling period after 1 April 2023 which we worry would disproportionately affect some businesses. It is also likely to come as a surprise to many taxpayers given that there has been no effective change in the overall limit.'

ESSENTIAL TAX DATES FOR MARCH

1 March
New Advisory Fuel Rates (AFR) for company car users apply from today.

3 March
5% late payment penalty on any 2021/22 outstanding tax which was due on 31 January 2023 and still remains unpaid.

19 March
PAYE, Student loan and CIS deductions are due for the month to 5 March 2023.

31 March
End of corporation tax financial year.
End of CT61 quarterly period.
Filing date for Company Tax Return Form CT600 for period ended 31 March 2022.
Last minute planning for tax year 2022/23 - please contact us for advice.

QUOTE OF THE MONTH

'While cash is here to stay, a digital pound issued and backed by the Bank of England could be a new way to pay that's trusted, accessible and easy to use.'

Chancellor Jeremy Hunt, commenting on news that a state-backed 'digital pound' will likely be launched this decade.

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