Welcome to the June 2023 Newsletter from Walsh & Co

The Institute of Chartered Accountants in England and Wales (ICAEW) has urged HMRC to consider how Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) can be redesigned to suit the needs of UK small property businesses and the self-employed.

Meanwhile, the Federation of Small Businesses (FSB) has called for energy suppliers to renegotiate fixed contracts for small firms on market-peak tariffs after research found that many are trapped in contracts that mean that their latest bills are at last summer's peak market rate for energy.

'Fresh thinking' needed in regard to MTD for ITSA

The Institute of Chartered Accountants in England and Wales (ICAEW) has written to HMRC regarding how Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) can be molded to better suit the needs of small property businesses and the self-employed.

On 19 December 2022, HMRC announced the deferral of MTD for ITSA's start date and an informal review into the initiative.

The ICAEW has written to HMRC to outline key points that it believes should be considered before the implementation of MTD for ITSA. These include rethinking the 'disproportionate' administrative burden associated with quarterly updates; decoupling the requirements to maintain digital records and to submit details of income from self-employment and property directly from software; and refocusing the MTD for ITSA initiative on digital record keeping and filing from software.

HMRC intends to make its final recommendations on MTD for ITSA to the Financial Secretary to the Treasury in June 2023.

Energy suppliers urged to renegotiate fixed contracts for small businesses

The Federation of Small Businesses (FSB) has urged energy suppliers to renegotiate fixed contracts for small firms on market-peak tariffs.

Research carried out by the FSB revealed that many small businesses are trapped in contracts that mean that their latest bills are at last summer's peak market rate for energy, despite wholesale prices having fallen since the winter of 2022.

13% of small firms polled fixed their energy contracts during market peak in 2022, the FSB found. It suggested that 93,000 small businesses could be forced to downsize, restructure or even close.

The business group has urged energy suppliers to give small businesses the option to 'blend and extend' their fixed energy contracts, allowing them to renegotiate or sign up for longer.

Tina McKenzie, Policy Chair at the FSB, commented: 'Having come out from a tough winter, this spring is supposed to be the beginning of economic recovery, but tens of thousands are still very much in survival mode because they are tied-in to sky-high energy contracts.

'Many small businesses agreed to lock in energy contracts last year to ensure they qualified for the maximum level of government support. Now, with that support largely disappearing, they are once again faced with massive energy bill hikes as rates go back to pre-Energy Bill Relief Scheme level.'

ESSENTIAL TAX DATES FOR JUNE

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

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

30 June
End of CT61 quarterly period.

QUOTE OF THE MONTH

'While firms can do more to make workplaces more flexible and jobs easier to access, the government must redouble its efforts to encourage and help people into work.'

Jane Gratton, Head of People Policy at the British Chambers of Commerce (BCC), commenting on a survey carried out by the BCC which suggested that UK businesses are still facing major difficulties in hiring new staff.

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