Is a business review of 2020 really worth it?December 31, 2020
Choosing your professional working backdropJanuary 29, 2021
Next stepsIn our last blog we focused on looking back over a year which has changed the course of business. The next stage involves taking steps to outline plans, set goals, fulfil obligations and meet deadlines in the coming months ahead. A task which, whilst the world is in disarray, seems almost impossible.
With the country now in its third lockdown and the economy looking bleak, it may be unfathomable to see how forging a plan for the future can be achieved. Add together the pressures of business changes caused by Brexit and all the elements combined can be extremely daunting.
Tax ReturnThe first impending deadline is the Tax Return due on 31st January. Many business owners will be at this time scrabbling around trying to put together the necessary information to meet the end of month cut off point.
For business owners this is a crucial and stressful undertaking, especially if left to the last minute. Those companies already enrolled in Making Tax Digital, should find the process easier. However, many do not fall into this category and therefore will be relying on a manual process.
Quick summary of what is needed:• P60 – showing your employment and tax deductions
• P11D – outlining expenses and benefits
• Bank Statements – covering the full tax period. This may be different depending on your company’s year end
• Receipts & sales invoices – showing what you have spent and what money you have earned
• Savings – relating to interest accrued on saving accounts
• Capital gains – information pertaining to assets, shares and property sales
• Child benefit letter – declaration of money received if your income is more than 50,000
Not even the global spread of COVID can halt your legal obligation to submit your return on time. If you fail to meet the deadline you will be open to facing penalties.
BrexitThe UK voted to leave the European Union on 23 June 2016 and four years later on the 1st of January 2021 this has now become a reality. In the EU referendum 33,577,342 people turned out to vote and the results to leave or stay were very close. The final tally ended with 51.9% (17,410,742) voting to leave and 48.1% (16,141,241) preferring to remain.
It’s been a turbulent, almost comical time with deadlines being rescheduled, long arduous negotiations reaching no agreement and a change in leadership. Many were starting to believe it would never come to fruition. It’s taking so long some are even believed to have assumed it had already happened. So, what will this mean for businesses?
Whilst the UK was part of the EU, there were no borders, businesses were able to trade an inexhaustible list of goods without paying tax. However, trade borders are now in place meaning business owners will need to apply for an EORI number and make customs declarations. Certain products will require evidentiary documents such as licences and certificates and some may face additional tariffs. Changes to VAT will also apply as will conformity regulations.
As with any governmental change all business owners are expected to understand what this will mean for them. For an in depth look at how this will affect your business please visit: Brexit Transition
Setting goals and plansMoving into a new year the hope was that COVID would be behind us, this unfortunately has not happened. The UK began 2021 plummeting into a 3rd national lockdown. Businesses, big and small have been forced to close again, meaning for some, business plans and goals will be on hold or even shattered.
However, spirits will certainly have been lifted with news of the national vaccination. The largest government immunisation campaign ever witnessed in the country. So, whilst the UK braces itself for the jab to the arm, businesses may only see a glimmer of hope on the horizon, but the light is most definitely visible.
Key elements to planning business strategy:Business owners will be asking themselves what now. How is it possible to plan for an uncertain future? For those able to ride the COVID wave continuing to apply focus to core areas can help sustain operations in the short term.
1. Keeping going – continuing where possible to operate, utilising creative strategies. Reducing products and services or branching out into other areas.
2. Retaining customer base – whilst business expansion may not be on the cards, ensuring resources are tasked with keeping customers on side is vitally important.
3. Brand awareness – businesses can still make themselves publically visible regardless of their operational status. Publishing content on social media and updating websites, even a few times a week will help retain a presence in front of an already established audience.
4. Cutting costs – reviewing core business functions looking for imaginative ways to cut back and streamline operations. Answers can be typically found within technological advancements.
5. Reducing risks – ensure your business is examining and identifying risk assessments to safe guard against weaknesses. Those areas identified should contain clear mitigation and contingency plans.
6. Shortening supply chains – the world has suddenly become smaller with global supply chains greatly affected. Using mapping strategies can help to analyse supply tiers needed to form end-to-end links in the supply chain.
ConclusionStarting the year in lockdown will for some feel like we are going backwards and with 24-hour news reels broadcasting harder times to come, this is completely understandable. But sometimes situations need to go back to allow the economy to go forward. Those businesses that survive will have established an impregnable set of skills which will be vital for the future.
Many new start-ups are appearing on the business spectrum regardless of the circumstances which demonstrates resilience and courage. For many the choice will be out of necessity rather than in the past, where considering going it alone was seen as daring or in some cases an arrogant undertaking.
The effects of keeping momentum when a business is struggling should not be underestimated, it can be demoralising especially if built from the ground up. But with hope in sight planning a way forward combining an exit strategy can create positivity serving to reignite passion. The importance of ensuring a company remains legal, may prove difficult, but meeting deadlines is imperative to sustaining and ensuring a future is possible.