Although the UK Government recently postponed the proposed fuel duty increase of 3p per litre until August 2012, fuel prices continue to fluctuate and remain within touching distance of the all time UK record high of 136.9p per litre set in May 2011.

Data issued by the AA (20^th December 2011) revealed the average price for a litre of unleaded fuel in East Anglia is now 133.3p, with diesel users facing an average price of 141.4p per litre. Should prices remain at or around this level into 2012 it could mean fuel prices approaching, if not exceeding, an all time record high come August’s fuel duty increase.

However, businesses in the East of England can prepare for any fuel duty increase and fluctuating fuel prices by exercising a fuel hedging contract. Fuel hedging brings stability to a business’ fuel purchasing strategy, allowing prices to be fixed for a set period, removing the element of uncertainty.

David McGill, Head of Treasury Solutions at Clydesdale Bank, said: “Even businesses using just 50,000 litres of fuel a month should be looking at the security provided by hedging, particularly during times like these when speculation over fuel prices is intense. Should the proposed duty increase go ahead in August, a business with this level of fuel consumption would be facing additional costs of £1,500 per month.

“Businesses should be taking this opportunity to review their fuel purchasing strategy and budgets. The obvious advantages of fuel hedging are the benefits of removing guess work from budgeting and relieving worries about possible sharp increases in fuel prices affecting cash flow.”

The hedged fuel prices relate to the daily rates quoted by the Platt’s Index, which is a source of benchmark price assessments for commodities like fuel. This hedged price is agreed at the start of the partnership between the company and the bank and will not deviate with any changes in the market price over the term of the contract.

David McGill said: “While average UK petrol prices have dropped from their record high of 136.9p per litre in May there is no guarantee that the downward trend will continue. The elevated prices of mid-2011 arose due to a combination of volatile factors, including unrest in the Middle East and economic uncertainty in the established high fuel consumption countries.

“Both these factors are still very much in play so it remains important for businesses of all sizes to stabilise their fuel purchases and be in a more secure position to manage their business.”

Amir Butt, Peterborough branch vice chairman of Federation of Small Businesses, said: “Taken as a package, the announcements in the Autumn Statement address many of the concerns raised by small businesses and are therefore to be welcomed. The key now is for the Government to be consistent, and set to the task of translating these policy intentions into tangible actions on the ground.

“Small businesses are struggling to access finance and so the enterprise investment scheme will open up new sources of finance for new and growing businesses. We hope that the banks will pass on the lower interest rates to small businesses and that more finance will be available.”

The FSB is pleased that the Government has enhanced the seed enterprise investment scheme which will offer greater reliefs on capital gains and income tax for people investing in small businesses. This will give start-ups and fledgling businesses the chance to by-pass the high street banks and find alternative sources of finance.

Extra funds for small businesses through the credit easing scheme is also to be welcomed. It should help to decrease the cost of finance for small firms and will hopefully increase the amount of lending to small businesses – especially with today’s figures from the Bank of England showing that lending fell in the last three months.

The FSB welcomes attempts to tackle firms’ rising overheads. Based on September’s inflation figure, businesses would have seen a 10 per cent increase in their business rates over the last two years. An extension to small business rates relief will be welcomed by many small high street businesses as a way to help manage their overheads.

Measures that will reduce the risk of taking on new staff and increase job creation are welcomed and an overhaul of the employment tribunal system is also a step in the right direction. But with youth unemployment rising to record levels, the Chancellor needs to be more ambitious in incentivising job creation by extending schemes like Work Trials to prevent unemployment becoming entrenched.

Deferring January’s fuel duty increase is welcome too but a 3p rise is still coming and will hit small firms and households in August. The FSB is calling for a longer-term solution that not only takes the volatility out of fuel prices but the politics as well. Small businesses need to be able to know what their overheads will be in six months time and that is why the FSB is calling for a true fuel duty stabiliser mechanism.

The FSB also has concerns that guaranteeing the loan books of existing high street banks may serve to reinforce their market position. The Government must therefore go further to promote the emergence of alternative forms of finance and greater competition in the banking sector.

His idea is to support local businesses on a part-time basis, providing them with the benefit of his expertise and experience but without the cost burden normally associated with a full-time senior executive with similar experience.

Mr Allmand (49), a trained accountant from near Market Deeping, has performed exactly this role for two owner managed businesses in South Lincolnshire and Nottingham for the last five years and previous to that has worked both employed and self-employed in a number of industries as diverse as retail, property development, franchising, telecoms and agriculture.

Speaking exclusively to Peterborough Business, Mr Allmand said, ”I would like to assist a growing company or a maybe help with a turnaround situation. I believe there are businesses that need management support but believe they cannot afford to employ a full time senior person in this capacity. I can provide such help as required probably one or two days a week but this can be flexible more or less a different times. I am looking for the right business to work with and become part of the management team moving the company forward. I feel I am equally able to work within an organisation long-term or assist on a short-term problem.

“Working with this size of business can mean much more than just numbers. I have been a key contact for their bankers and auditors, have helped on executive recruitment, dealt with insurance renewals, lease contracts, and much more as well as producing the financial information key to managing a business. I see myself as approachable, flexible and always willing to roll my sleeves up and get hands-on to solve a problem working alongside existing accounts staff.

“Contacts I have with bank managers like this concept as very often it is the lack of reliable information from a business that causes concerns to banks, knowing there is a solid accounting pedigree within the business provides them with comfort. This proposal is extremely cost effective as there is not the commitment for a business to a large full-time salary and benefits package when for much of the time this person could be doing functions that could be done by less experienced and by default employees earning less.”

Contact Gavin Allmand by email at: mail.gpassociates@dsl.pipex.com or phone 07970 369597.

Auto-enrolment will see all employees automatically enrolled onto their employer’s pension scheme. The requirement will be phased in over four years and affects all staff aged between 22 and pension age earning more than around £7,500 a year.

“Businesses need to be acting now to ensure they are aware of the changes they will need to make and the necessary systems they will have to put in place,” said Rawlinsons’ partner Ken Craig. “The briefings we have organised will help explain the requirements and their implementation.”

The two hour briefings, free to delegates, will take place at the Rawlinsons’ office on Lincoln Road, Peterborough. Speakers include experts from Rawlinsons and the firm’s payroll division. They take place during November, on the 16th, 17th, 21st and 22nd.

For more information or to book your place please email carolyn.lake@rawlinsons.co.uk or call Carolyn on 01733 568321.

The proposed deal – which was announced in August – was signed a fortnight ago and after ratification by both governments will come in to force in January 2013.

Yet, says Stephen Collins a partner in Saffery Champness office in Peterborough, it appears that HM Revenue and Customs (HMRC) have already begun to act.

He says: “While the HMRC declared that it would not ‘actively seek to acquire date stolen from Swiss banks’, a press notice issued last Thursday (13 October) confirms that it is targeting 6,000 Swiss bank accounts acting on information it received last year. To date, the HMRC states that it has begun investigations in to more than 500 of these accounts which are held by a Geneva-based bank.”

While acknowledging that the landmark agreement between the UK and Swiss governments will only affect a very small minority of taxpayers with potential for tax liability in the UK, Stephen Collins does say that the deal and the speed with which HMRC has acted represent a renewed focus on the propriety of tax affairs of those with significant wealth.

Stephen concludes, “This international agreement, as well as the national context of the ongoing political debate about the 50 per cent top-rate tax, means that clarity on tax liabilities is more sought-after than ever by individuals and companies alike.”

Left-right: Paul, Becky, Tori, Sally

JUST two years after opening for business, Peterborough accountancy firm Winham Hughes is expanding. Four members of staff have now joined partners Sally Winham and Paul Hughes and the growing workforce has prompted a move to new premises.

Sally and Paul took what they describe as a ‘calculated risk’ starting the company in 2009, when the country was in the depths of recession. It was a risk that paid off. Their client list has more than doubled and, by taking on new members of staff, they have been able to extend their services.

Becky Thrift has joined the business providing additional services such as on-site payroll and day-to-day bookkeeping.

“For some of our smaller clients, Becky has become their accounts department, working in their offices for a spell each week,” said Sally. “That kind of flexibility has been key to our success. As a small firm, certainly when we were starting up, we have been able to design our processes around our clients.”

Sally and Paul have also been joined by trainee – Tori Bradshaw – who splits her time between college and Winham Hughes’ new office in Forder Way, Cygnet Park, Hampton. There is also further help from support staff.

The new premises has extra storage areas and two meeting rooms – both of which are available for Winham Hughes’ clients to utilise.

“This is an exciting move for us and will open up new opportunities both now and in the future,” said Sally. “As well as ensuring we continue to deliver the high level of service our clients expect, we will be able to offer additional services and look at further expansion.”

The company has also increased community involvement, being involved in the sponsorship of Peterborough Regional College’s annual awards and organising its first seminar, in conjunction with other professionals.

The FSB welcomes the government’s plans to help unlock growth by accelerating investment in infrastructure, but it must be targeted in the right areas, particularly the road network which creates delays and costs for small businesses and acts as a barrier to growth.

Amir Butt, Peterborough Branch Chairman, Federation of Small Businesses, said, “Small businesses feel plagued by the poor state of repair of the UK road network. They should not have to pay £5,000 because of failing roads – it is significant waste to their business at a time when they can ill-afford it.”

In the FSB’s ‘Voice of Small Business’ survey panel of more than 1,700 businesses, half said that the problems with the UK’s infrastructure has cost their business up to £5,000 over the last 12 months.

Another 12 per cent said it cost them between £5,000 and £19,999 – this is a huge figure when considering that the average turnover for small firms is around £500,000.

Amir added, “It is vital that the government rebalances the amount spent on the road network with the amount collected so that small firms can get on with the job at hand of growing the economy, without worrying about roads impacting negatively on their business.”

The FSB welcomes the government’s plans to handpick 40 of the biggest infrastructure projects for investment, but urges it not to neglect existing infrastructure that also requires investment, warning that more needs to be done to address the problem of congestion and the state of repair of UK roads in order to get businesses moving and growing. At a time when small firms’ cash-flow is already being squeezed, the cost to small firms in lost productivity and damage to their vehicles is one that significantly hampers their growth.

In a new report, ‘Small Business and Infrastructure: Transport’, the FSB is calling on the government to rebalance the funds collected from road users and the amount invested back into improving the road network, to prevent the poor state of roads and high levels of congestion from costing small firms.

Leading Peterborough accountancy firm Rawlinsons, based in Lincoln Road, is now keen to reassure people they won’t be required to pay the amount owing as a lump sum. Instead HMRC will, in most cases, recover the debt by altering the tax paid in the next financial year.

The annual review of tax payments saw HMRC refunding an average of £340 to around 3.5 million tax payers who had overpaid in the year to April 2011.

That process was completed at the end of September and the government will now begin contacting those who have underpaid. Form P800s will be sent to those people affected and tax codes for the year 2012-2013 reduced accordingly.

Ken Craig, Rawlinsons partner, said, “This is part of HMRC’s regular conciliation of UK taxpayers’ PAYE records. While any overpayment is refunded, underpayments are generally collected by changing the relevant tax code for the coming year.”

This year has seen a reduction in the amount of underpayment written off from £300 to just £50.

Ken added, “For that reason we expect more people than usual to be alerted in respect of an underpayment. We are now working with clients to prepare them for compliance.”

The rates, which are known as Advisory Fuel Rates (AFRs), now commence every quarter – since June 1, 2011 – having originally changed every six months unless fuel prices rose or dropped by more than 5 per cent.

The latest quarter commenced on 1 September 2011 – although the only change from the previous quarter is in the LPG rates.

If businesses use the correct AFRs, their company car drivers won’t be liable for any free fuel tax liability; and businesses themselves won’t have any National Insurance liability.

If your company pays for all fuel, company car drivers can repay the business mileage element using the AFRs – and again avoid any tax liability.

The new rates – with different payment amounts for petrol company cars and diesel-engined company cars – are as follows:

Advisory Fuel Rates from 01 September 2011 for petrol and LPG cars (including hybrids)

Engine size
1400cc or less: 15p (petrol); 11p (LPG)
1401cc to 2000cc: 18p (petrol); 12p (LPG)
Over 2000cc: 26p (petrol); 18p (LPG)

Advisory Fuel Rates from 01 September 2011 for diesel cars

Engine size
1600cc or less: 12p
1601cc to 2000cc: 15p
Over 2000cc: 18p

These rates only apply if you have a company car. If you use your own private car for business, the rates you should be using are the AMAP (Approved Mileage Allowance Payments). These are 45p per mile for the first 10,000 miles in a tax year; and 25p per mile thereafter.

Whichever category you fall into, though, make sure you record your business mileage properly – approximations won’t do for the taxman.

Author Ralph Morton is editor and publisher of Business Car Manager magazine (www.businesscarmanager.co.uk). He was named Business Writer of the Year in the Guild of Motoring Writers Awards 2009.

According to new research by Clydesdale Bank released today (September 12, 2011), over half (59%) of the businesses questioned in the region expect to increase turnover in the year ahead, despite just over a quarter (28%) being confident the economy will return to healthy growth.

Despite concerns about the economy, 39% are planning to invest at least five per cent of turnover back into their business in the next 12 months with the leading investment priorities being new staff (39%), training (30%), new equipment (29%), and developing new products and services (25%).

The most pressing concerns for businesses in the East of England are fluctuating fuel prices and rising corporation tax, with just over a quarter (26%) and more than a fifth (22%) citing these issues as the key factors in their businesses’ future growth respectively.

Martin Guildford, Managing Partner of Clydesdale Bank’s Peterborough Financial Solutions Centre, said: “Businesses in this region are clearly more confident about their own prospects and in control of their own destiny, than they are for the wider economy, despite the impact of rising fuel and materials prices. It is inevitable that there will continue to be bumps in the road to economic recovery, but UK businesses should continue to focus on their own strengths.”

Across the industries, IT and telecoms businesses appear to be the most confident with more than half (51%) expecting increased turnover of at least five per cent in the next 12 months. Healthcare and education businesses are the least confident with only 32% and 23% respectively expecting similar growth. This is mirrored in their investment intentions, with 59% of IT and telecoms businesses planning to invest at least five per cent of their turnover back into the business compared to only 27% of education-focused businesses.

Martin continued: “Our commitment to supporting trading businesses is stronger than ever and we continue to attract growing numbers of owner-managed small and medium sized businesses plus mid-corporates. Good businesses with strong management and robust business plans will generally find support. This is evidenced by the fact that we recently met our promise, three months ahead of schedule, to deliver our two-year pledge to advance £10 billion of new lending to business and personal customers.”