KSK BUSINESS UPDATE JAN/FEB 2021

We have now posted our latest edition of Business Update

Can we escape Groundhog Day…?

Severe flooding affects parts of the UK! President Trump has been impeached! Warnings of wildfires in Australia! The start of 2021 feels a lot like a bad dream about 2020, with the addition of a what is now a third lockdown.

As the prime minister and the health secretary are reluctant to put a timeline on lifting lockdown restrictions, we are left hoping that the vaccine programme will progress as planned to help us escape what often feels like our own Groundhog Day. The coronavirus job retention scheme (CJRS) is currently due to continue until 30 April 2021, but watch out, the job retention bonus that was due to be paid in February has now been withdrawn as the CJRS continues instead. Further measures to help have also been implemented: deferred VAT payments can be put off further into the future with another help to pay scheme, and the increase of the AIA limit up to £1,000,000 for businesses is now extended until the end of 2021.

But of course, 2021 will not only be about the country’s response to Covid-19. Britain and Europe are having to adjust to new legislation now Britain has left the EU Importers and exporters have been in the forefront of the news, with concern about delays at the ports for perishable goods and increased costs affecting business viability. New VAT rules for importers affect all countries trading with the UK, not just those in Europe, although those businesses operating outside of Europe will receive a cashflow boost from the new regulations. The government has introduced a customs grant scheme which offers payments to both importers and exporters who are required to make significant adjustments following Brexit to ease their transition.

HMRC’s long-running making tax digital (MTD) modernisation scheme also enters a new phase this year. Those already required to submit their tax returns via reporting software must now make sure their data follows a fully automated workflow, to minimise human error in the system.

For information on the new VAT postponed accounting system for importers, further reliefs for businesses and anticipated changes to capital gains tax see our January newsletter, which covers these topics and more. And as always do get in touch if any of the issues covered affect you and your finances.

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