Politics impacting accounting
BY IAN KELLY, TAX PARTNER
As I write this column, just over 14 hours have elapsed since the result was announced of the no-confidence vote in Boris Johnson.
Quite what will happen over the next few months to the Prime Minister no-one knows, but any change at the top and in policy direction is going to impact on us all.
If we cast our minds back just a couple of months to the Spring Statement, rumours of a u-turn on the Health Care Levy were doing the rounds which, ultimately, came to nothing.
Calls to revisit the freezing of the personal tax allowance and basic rate tax threshold also see no change to the prevailing situation. The Chancellor of the Exchequer, Rishi Sunak, aware of the increasing numbers being sucked into higher rate taxation, maybe saw this coming and countered with the promise of a 1% cut in the basic rate of tax by the end of this parliament. Not quite the same thing.
Families and businesses continue to be affected by the cost-of-living crisis and it’s a shock to the system when you drive past some forecourts and see how close fuel has come to £2 per litre.
For businesses there is the dilemma as to what increases can be absorbed and what need to be passed on to customers.
Businesses also need to plan ahead when it comes to capital expenditure and are faced with juggling their daily costs and trading results and the cost of the asset they are considering.
Recently there has also been the spectre of HM Revenue and Customs starting to look into the Self-Employed Income Support Scheme (SEISS) grants claimed by the self-employed and partnerships and which fall to be declared on tax returns for the years ended 5 April 2021 and 2022.
For our clients, those in business and individuals, there are tax returns to file and which will impact on tax payments several months down the line. This takes me back to my last column (click here to read) when, given tax payment dates ahead and inflationary pressures, I urged clients to give early attention to these two compliance areas. Events since then have merely reinforced that advice.
Should you require our help with any challenges you’re currently facing or anticipating, please call – 01642 606003.