Welcome to the December 2012 Newsletter from Connolly Accountants Ltd

As the Autumn Statement draws nearer, business groups have urged the Chancellor George Osborne to implement measures to support businesses and stimulate economic growth. They include calls for an emergency capital allowance tax relief and a freeze in fuel duty, which is currently set to rise in January.

The Autumn Statement will take place on Wednesday 5 December. Be sure to visit our website for the latest announcements that could affect you and your business.

This month also saw the Deputy Prime Minister reveal further details of the Government's plans to extend flexible working rights to all employees and to allow couples to share maternity leave. While some experts have welcomed the proposals, others have warned that the measures could add to the financial burden on UK firms.


Chancellor urged to kick-start growth ahead of Autumn Statement

Chancellor George Osborne is being urged to consider a range of growth measures to kick-start the economy ahead of the upcoming Autumn Statement.

With growth forecasts for the economy widely tipped to be downgraded, leading business groups have set out a plethora of proposals aimed at helping struggling firms and boosting the economic recovery.

Publishing its submission to the Chancellor, the British Chambers of Commerce (BCC) has called for an emergency tax relief to encourage businesses to invest.

Specifically, it wants to see a new £1bn 'when it's gone, it's gone' capital allowance relief for the financial years 2013/14 and 2014/15, which would enable firms to write off the entire cost of qualifying investments.

It claims the measure could help to bring forward large business investment projects and benefit companies in investors' supply chains.

The lobby group's Autumn Statement submission also sets out plans for a £100m 'Growth Voucher' scheme, which would award 20,000 businesses with clear growth plans up to £5,000 each to seek support and advice on business finance, growing their staff and navigating the business planning system.

'Our message to the Chancellor is clear. Business will lead Britain's economic recovery, but needs targeted support and a confidence boost from government,' commented BCC Director General, John Longworth.

Meanwhile, the Confederation of British Industry (CBI) has outlined its proposals for stimulating the economy. They include £140m to cap the increase on high street business rates at 2% and bigger investment allowances for small companies at a cost of £330m.

January's planned 3p rise in fuel duty has also been the subject of debate this month, with both the British Retail Consortium and the Forum of Private Business urging Osborne to use his forthcoming Autumn Statement to scrap the increase.

'We would like to hear Mr Osborne announce a freeze on fuel duty for the foreseeable future,' said Alex Jackman of the FPB. 'The less duty consumers pay on fuel means more money swilling around the economy, and an outright freeze will also provide more stability for small firms to plan ahead for 2013 while encouraging consumers to spend'.

Although the exact content of this year's Autumn Statement is unknown, there is growing speculation that the Chancellor could reduce the tax-exempt threshold for pension contributions to £40,000, or even £30,000.

Osborne is also expected to reveal further details of his plans for a state-backed small business bank, which aims to address the difficulties faced by small firms seeking credit.

The Autumn Statement will be presented on 5 December and we will be providing a summary of the key announcements on our website the following morning.


Business reacts to parental leave plans

Business groups have given mixed responses to new reforms that will extend flexible working rights to all employees, and allow new parents to share up to a year's leave to look after their newborn baby.

Deputy Prime Minister Nick Clegg confirmed that while women will have to take an initial two weeks of leave following the birth (four weeks in the case of manual workers), from that point on parents can opt to share the remaining leave as flexible parental leave.

Under the new system, from 2015 parents will be able to take leave in turns, or at the same time, as long as the total amount of leave taken does not exceed 52 weeks.

The aim of the proposals is to encourage a 'culture shift' in the workplace that reflects modern family life, allowing parents more flexibility when arranging childcare, and encouraging up to one million women who are currently 'missing' from the UK economy to return to the workplace.

The right to request flexible working will also be extended to all employees by 2014, with the aim of supporting modern families and boosting the UK labour market by providing more diverse working arrangements.

The statutory procedure for considering requests for flexible working will be replaced with a duty to consider all requests in a 'reasonable manner'.

Commenting on the reforms, Jo Swinson, Minister for Employment Relations, said, 'These proposals bring good news for business – not least a more motivated and productive workforce. Employers will be able to recruit and retain staff from a wider pool of talent, in turn helping to diversify our economy and drive growth'.

The CBI welcomed the reforms, but warned that firms must retain the right to make decisions on a case by case basis.

The CBI's Katja Hall said, 'Flexible parental leave is a good way to support working families and businesses realise that this is good for retaining talent. We must ensure the new system is simple to administer, and does not give rise to legal action from fathers seeking parental rights that mirror those available to mothers'.

However, the Federation of Small Businesses said extending the right to request flexible working would place added burdens on firms.

'Allowing chunks of maternity and paternity leave of as little as one week to be taken will place a disproportionate strain on small firms and will be very complicated to administer,' said its National Chairman John Walker.


ESSENTIAL TAX DATES AND DEADLINES

30 December
Last day for online submission of 2012 Tax Return for HMRC to collect tax through clients' PAYE code, where they owe less than £3,000.

31 December
Last day for non-EU traders to reclaim recoverable UK VAT suffered in the year to 30 June 2012.
End of relevant year for taxable distance supplies to UK for VAT registration purposes.
End of relevant year for cross-border acquisitions of taxable goods in the UK for VAT registration purposes.
End of CT61 quarterly period.
Filing date for Company Tax Return Form CT600 for period ended 31 December 2011.

For more key tax dates and deadlines visit our 2012/13 Tax Calendar.

QUOTE OF THE MONTH

'This Autumn Statement is a chance for the Chancellor to make amends for the disappointment that was the March Budget, and really show he understands the challenges the economy faces.'

Alex Jackman, Head of Policy at the Forum of Private Business, highlights the significance of the Chancellor's impending Autumn Statement


WEBSITE OF THE MONTH

www.smeweb.com

Online resource for small and medium-sized enterprises


ON OUR WEBSITE

New - Changes to child benefit
For information and advice on the new child benefit charge for higher earners, visit the Hot Topics section of our website.

Expert advice on managing your business
Our website contains essential advice and information on managing your business. Visit the Your Business area of our website to find out more.

Government reveals 'one-in, two-out' policy to cut red tape
The Government’s so-called 'one-in, one-out' policy on regulation is to be overhauled from next year.
Click here for the full story

New PAYE system 'imposes new burdens' on SMEs
HM Revenue & Customs' new PAYE system, known as Real Time Information, will create new burdens for smaller businesses, which some will find difficult to cope with, according to the Institute of Chartered Accountants in England and Wales.
Click here for the full story

Revenue relaunches Business Records Checks
HM Revenue & Customs has relaunched its Business Records Checks programme, with the promise that it will adopt a more business-friendly approach.
Click here for the full story

Revaluation of business rates postponed until 2017
The Government has postponed next year’s planned revaluation of business rates until 2017, with the stated aim of protecting small businesses against unexpected increases in rates.
Click here for the full story

Thousands to be pulled into self assessment system under child benefit reforms
Hundreds of thousands of families may be required to complete a self assessment tax return for the first time when the forthcoming child benefit cuts take effect.
Click here for the full story