6 Financial, Legal & Accounting


22ND APRIL 2024 BUSINESS GUIDE DISTRIBUTED WITH Spring Budget: what you need to know


The spring Budget was the government’s last chance to set out major fiscal policies before the general election. So, here’s everything business owners should know in the wake of it. Words: Annie Makoff-Clark


On the surface, chancellor Jeremy Hunt’s second Budget played it relatively safe with no big surprises. A 2p cut in National Insurance, a reduction in the higher rate of Capital Gains Tax, nom-dom tax status scrapped and fuel duty frozen for yet another year. However, there were some notable


exceptions. Te earning threshold at which companies must register for VAT is set to increase from £85,000 to £90,000 — making it the first threshold increase since 2017. As well as this, the creative industries also received a surprise boost with the announcement of £1bn in new tax reliefs.


Was enough done? Lionel Benjamin, co-founder of AGO Hotels, notes that some of the issues affecting SMEs were either not addressed — such as tourism taxes — or what was offered didn’t go far enough, like the VAT threshold. “While the decision to freeze


beer duty provides some relief to the hospitality sector, much more was needed. As economic pressure continues to drive up operating costs, we’ve seen businesses permanently close their doors. To avoid this, the main focus for AGO Hotels will be walking the fine


line between making profits and preventing additional costs from hitting consumers.” Bridget Hannon, founder of


Blush+Blow London and Te Skin Studio, feels the same. “Te change to the VAT threshold was positive, but it’s not substantial enough for those of us who have more than £90,000 in turnover,” she explains. “I feel the beauty industry has been completely ignored. High VAT and other business costs are the reason why many high-street businesses are failing,” she says. Levelling-up initiatives in


housing, culture projects and regional regeneration schemes across the UK were widely welcomed by regional groups and businesses. “I was really pleased to see funding for new housing projects like Barking Riverside and Canary Wharf in the Budget and the acquisition of two new nuclear sites,” says Amos Simbo, founder of commercial fitout and design installation company Winway Consultants and founder of Black Professionals in Construction. Yet construction, argues Amos,


is a particularly volatile sector. Skills shortages, extremely tight profit margins and supply chain challenges continue to be an issue.


MICHEILE HENDERSON ON UNSPLASH


It’s a wider problem that needs a strategic long-term plan, he feels. “Funding for construction


projects is essential, but I think the government has very little visibility about what’s going on. Tere is no government department or minister to oversee the sector and that’s much needed,” concludes Amos.


What can business owners and entrepreneurs do to mitigate some of these issues? “Make decisions based on what’s best for your business rather than trying to second guess tax policy,” advises Michelle Denny-West, tax partner at Moore Kingston Smith. “People are focused on trying to save tax here and there, but are these the right decisions for the business?” Ensuring a business can actually


afford to grow is also of critical importance. With increased borrowing costs and heightened business rates, a business’s growth needs to be supported by accurate forecasts and a healthy cashflow. “Business owners need to recognise that not all money is good money, despite how strange that sounds,” says Amos. “You shouldn’t be chasing turnover, you should be chasing good profits. And always remember that cash is king.”


Law through a different lens


Running with scissors. How to modernise legal services... without getting cut. Natalie Kuebler, director, Alt-V Law explains By


In the dynamic landscape of legal services, law firms may be excused for feeling akin to parents navigating the demands of their tech-savvy tweens, captivated by computing, and deluged by dubious influences. Clients are emboldened by unre- stricted access to technology and press for Superbowl-level perfor- mance, urging firms to deliver either a flop, or a mic drop. Te client demand for modernisa-


tion necessitates firms to champion new standards and select delivery partners carefully. Validated experi- ence, unwavering credibility, diverse methodology and cultural alignment are paramount to success. Authen- ticity, transparency and humility are crucial in navigating this tense evolution. Te world has been catapulted to


a future saturated with technology acronyms. AI, LLMs, RNNs and abundant promises of what automa- tion will deliver. As clients entrust firms with sensitive legal matters, firms face an immediate challenge: to demonstrate evolution and value while ensuring quality standards. Technology providers seize the opportunity. Te question arises: who’s driving


change? To avoid


becoming the slave to two masters, law firms must take ownership of this change and avoid allowing anyone other than themselves to dictate the narrative. Firms must establish clear procurement guidelines, processes and risk frameworks.


aligning transformation


success measures with client needs and measuring benefits realised, firms can wield these powerful tools. Akin to running with scissors – they must take proactive measures to safeguard against unintended consequences. Measure iteratively, then cut once.


What do firms do to stay ahead of the curve? Use methodologies with creative abandon and keep audit trails of decision processes. Te ‘Grimm’ reality of any transformation is that it’s long, arduous, and treacherous, so think Hansel and Gretel. Leave a trail of breadcrumbs so that when you inevitably lose your way in the woods, you can find your way home to safety. Craft a vision and narrative that


everyone can appreciate and own. Celebrate cultural synergies and strategic thinking: both are vital for meeting client needs effec- tively.


Invest in validated partner-


ships grounded in authenticity and transparency. Treat technophiles, with unrestricted access to a plethora of powerful platforms, with caution. Get to know your suppliers in the way that regulators insist upon and remember the client


is


always right. Like determined teen- agers clientsrightfully demand more from legal service providers, propel- ling the modernisation — a trend firms should eagerly embrace.


For more info, visit altvlaw.com


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