This year’s Autumn FD Seminars piggybacked Jeremy Hunt’s Autumn Statement, giving our guests need-to-know updates and all the tools to become a finance superhero, bar the spandex suit.
Following the Chancellor’s announcements, finance leaders from across the UK flocked to the East and West Midlands for two power-packed sessions. Waiting for them, an expert lineup of speakers, ready to share their insights on accounting standards, ESG reporting, Autumn Statement highlights, the deals market, R&D changes and the UK economy as a whole.
The learnings came thick and fast, and we’ve cherry-picked all the best bits below.
UK ECONOMY: THE EXPERT’S VIEW
Brilliant commentary on the economy and inimitable speaking skills have made Mark Berrisford-Smith one of the first names on our FD Seminar presentation lists.
When the former HSBC Head of Economics visited us in March, the news was grim, with double-digit inflation rates and a struggling economy. This time, inflation was down to 4.6%, but the economy still isn’t growing.
“We’ve done the hard yards,” Mark told us, “but we’re now at the bit where it’s going to hurt the most, and we’re probably here for another 6 months, in the UK and the rest of the world.”
With the outbreak of the conflict in Palestine, global growth has slowed and trade is declining. Interest rate pains are evident as we try to drive down inflation, and commodity prices are rising again across the board.
The Autumn Statement was one of the largest fiscal statements that any British government has ever delivered, and one of the biggest giveaways outside of COVID, totalling more than £90bn. But, the tax burden is still rising.
“The Chancellor’s NI cuts take a little bit of an edge off the fiscal drag,” Mark said, “but we’re all being dragged into higher tax rates because they’re not changing the thresholds,” and it’s expected 3 million people will be dragged from basic to higher rate tax.
Retail volumes are down and the housing market is extremely quiet as money for goods and deposits is being “eaten up” by high rents. While Mark described the economy as going through a “lacklustre, nothingness period,” he also pointed out reasons for optimism.
The IT & Comms sector is a sixth larger than before the pandemic. Similarly, hospitality, which has surpassed pre-COVID levels. Slightly lower mortgage rates are on offer. And, as wages overtook inflation in the summer and real earnings rose, the infamous ‘cost of living crisis’ may have eased for many, leaving “people feeling slightly less under the cosh.”
For Mark, however, “the UK’s labour market is still too tight.”
“It drove our inflation so high and kept it there. The vacancy figure peaked at nearly 1.3m last year. It’s now around 950,000, and when it gets under 850,000, I’ll be a lot happier because pressures on inflation could then ease in a way that’s sustainable.”
It takes a special speaker to keep the audience laughing while presenting a relatively bleak overview of the UK economy, but Mark did just that. Now, we await his next visit and hope his crystal growth ball proves true in six months’ time.
ACCOUNTING STANDARDS UNWRAPPED
Cat Kelly, our Head of Retail & Relationship Partner, had the ever-enviable task of bringing the room up to speed on the latest accounting standards.
The effective date of FRED 82 has been delayed by a year to accounting periods commencing on or after 1 January 2026. The set of draft amendments to FRS 102 across revenue recognition and lease accounting also features major changes to FRS 105, and while the delay will give you more time, it’s recommended to make preparing for the new standards’ impacts a priority.
Similarly, FRED 84, which is set to introduce new disclosure requirements concerning the use of supplier finance arrangements, with a proposed effective date of 1 January 2025.
The FRC’s Annual Review of Corporate Reporting saw 27 of the 252 reviewed companies asked to restate aspects of their accounts. The five most common issues were impairment of assets, judgements/estimates, cash flow statements, strategic reports/CA06, and financial instruments. Income taxes, revenue, provisions/contingencies, presentation/disclosure and fair value measurement were also recurring issues for a lot of companies.
Cat gave us a whistle-stop tour of the upcoming updates to auditing standards ISA 315, ISA 240, ISA 220 and ISA 600. For brevity, we won’t detail all of them here, but if you think they might affect you, get swotting up.
The Economic Crime & Corporate Transparency Act is in its final stages and has been put forward for Royal Assent. These attempts to clamp down on inaccurate or misleading information about the structure and leadership of companies were partly born from the conflict in Ukraine. It soon became apparent there was a lot more Russian money in London than first thought, but no way to tell who actually owned the businesses in question.
The upcoming Companies House reforms are set to arrive against a backdrop of higher volume, more sophisticated phishing and fraud attempts. Traditional industries and businesses are being targeted, particularly those with legacy systems. So, stay vigilant.
ESG REPORTING & SUSTAINABILITY
ESG is on every UK company’s radar. Firstly, because it’s the right thing to do. Secondly, because it’s the law, and the government is introducing significant changes to sustainability reporting, as Nicoleta Ciobanu, our Head of Sustainability told our guests.
The current ESG reporting landscape is, as Nico describes it, an “alphabet soup” of acronyms and jargon-heavy legislation.
ESOS (Energy Savings Opportunity Scheme) is a mandatory energy assessment scheme for any UK organisation considered a ‘large undertaking’. To qualify, you must have more than 250 employees, or a turnover of more than £44m and a balance sheet over £38m. Plus, if you’re part of a group and one undertaking meets the criteria, the entire group must take part in ESOS.
The process will give you practical energy saving recommendations which often lead to real cost savings, and it’s an important step on the road to Net Zero. The assessment program runs every 5 years for qualifying businesses and the Phase 3 deadline has been moved to 5 June 2024 to help companies implement the changes. In Phase 4, it’s expected the threshold will align with SECR and require a Net Zero assessment and emission reduction trajectories.
SECR (Streamlined Energy & Carbon Reporting) applies to all UK entities that meet two out of three criteria:
- Turnover > £36m
- Balance sheet > £18m
- Employees > 250
At a minimum, you’ll have to disclose your energy consumption used to calculate emissions, Scope 1 emissions from combustion of gas and fuel for transport purchases, Scope 2 emissions from purchased electricity, and Scope 3 emissions from business travel in rental cars or employee-owned vehicles. However, changes are expected in 2024 that will see more mandatory Scope 3 reporting (currently just encouraged), mandatory use of the GHG Protocol and more emphasis on setting and meeting targets.
TCFD (Task Force on Climate-Related Financial Disclosures) makes it mandatory for any company with 500+ employees and £500m+ turnover to report climate-related financial information, risks and opportunities.
One to watch out for next year is the UK SDS (Sustainable Disclosure Standards), which was formed to address ISSB (International Sustainability Standards Board) application in the UK. UK SDS aims to unify SECR, ESOS and TCFD reporting into an overall, annual set of sustainability reporting requirements.
With UK requirements expected to publish in July 2024, it’s likely SDS will include Scope 3 emissions and also introduce a UK Green Taxonomy, similar to the EU sustainability legislation.
See what we mean about the acronyms? Beyond getting to grips with the “alphabet soup”, Nico recommends you start managing your company’s emissions, particularly Scope 3. They account for the largest proportion of your emissions, and while they can be tricky to calculate, it’s becoming unacceptable to ignore them. The process could also help you identify opportunities for cost savings, get ready for a Net Zero target, secure better finance deals and futureproof your compliance.
WHAT’S THE DEAL WITH DEALS?
Andy Parker, Partner & Head of Corporate Finance, gave us his update on the M&A market and all the trends that the CP Deals team has been noticing recently.
Volume-wise, after a strong post-COVID resurgence, numbers dropped in the second half of 2022 following Russia’s invasion of Ukraine and the resulting spike in energy prices; the Israel-Palestine conflict has added more uncertainty.
However, where we are now in 2023 is similar to where we were five years ago, pre-Covid in a “normal market”. So, it’s not a bad market. And now, noticeably, there’s more and more private equity going into deals and businesses, filling the gap left by the lower debt levels.
Lower debt levels have impacted pricing and equity returns. More intense scrutiny through due diligence and increased regulation has slowed deals. But, crucially, they’re still getting done and Cooper Parry Corporate Finance has an enviable track record of getting all of our sales mandates done for the last 4 years.
Private equity houses are moving their attention away from big platform deals because they can pose risks and could uncover “skeletons in the closet”. Instead, they’re backing their original investment with more money to do bolt-on acquisitions, and CP is a case in point, as we’ve completed 6 bolt-on deals this year alone, backed by Waterland.
Private equity continually wants to invest in sectors with a high degree of tech-enablement, where mega-trends have big impacts and help other businesses meet regulations. Prices and deal volumes in core, recession-resilient sectors like Healthcare, Technology and Business Services are looking healthy, and the CP Deals team has advised on a number of transactions across these spaces over the last few years.
Is 2024 going to be a bumper year? Andy doesn’t think so, but there are reasons to be cheerful.
Private equity has record amounts of “dry powder” in its hands, ready to be invested. The future political and fiscal change around CGT should initiate shareholder action early. Inflation and interest rates looked to have peaked, and while they’ll probably stay relatively high, they’ll be stable too. Cash-rich companies with private equity backing continue to execute M&A strategies. And as confidence in the market increases, we get more accurate valuations too.
BUDGET BEST BITS
Adele Raiment, our Tax Director, went through all the highlights from the Autumn Statement for individuals and businesses, and you can read more about them in our full Autumn Statement summary.
Mark Frost, CP Innovation Partner, spoke about the merging of the two main R&D tax regimes and the impacts it would have on RDEC and SME claimants. A topic we covered in detail in this blog.
Thank you to all our speakers and guests for an incredible, insightful morning. We hope you took away as much as we did, and we look forward to seeing you at the next one.
Nicoleta Ciobanu, our Head of Sustainability, was recently invited to London by B Corp for one of their campaigns.
The B Corp community is made up of businesses putting people, planet and profit on the same plane. They’re redefining success and using growth as an opportunity to make a wide-reaching, long-lasting, positive impact on their employees, communities, and the environment.
We became the UK’s largest accountancy B Corp in March 2023, and the whole process gave us a newfound purpose and clarity around what it took to become the well-rounded force for good we’d always strived to be.
In many ways, working towards becoming a B Corp brought us closer together, and it’s paved the way for so many of our impact-related activities since.
That’s why it was an honour to be asked to be a part of this B Corp campaign.
Check out Nico’s interview and find out more about the challenges we faced, how the B Corp process helped, and the impact it’s had on CP here.
Here at CP we’re all about making life count for our people. We were one of the first companies to introduce things like flexible and remote working. Hybrid working is now a norm across many firms so we’ve been updating our offer to new and existing CPers. I’ve been reflecting on our approach to recruitment and retention which has evolved over recent years.
It’s now commonly accepted that recruitment and retention have proven challenging for many sectors in the aftermath of the COVID-19 pandemic. Research has shown that there’s a growing culture of ‘quiet quitting’ as employees become less engaged with their roles. The result being that productivity levels are weak.
The accountancy sector isn’t immune from these challenges and employee relations and recruitment haven’t been as straightforward since the pandemic. In lots of ways, it’s become a candidate’s marketplace. Making it really tough to hire, particularly at senior manager level and especially in the audit space.
We like to be different. Living true to our ‘Rebels of Accountancy’ culture in what can often be a traditional and serious profession. Long before the pandemic hit, we had invested heavily in building a strong employee culture. We offered things like yoga and fitness classes on-site, as well as visiting hairdressers and other well-being practitioners. The aim being to boost people’s health and happiness. We also track employee engagement through regular surveys. Our flexible and remote working practice were established and valued by our people.
THIS IS HOW WE DO IT
Yet in the aftermath of the pandemic, when flexible working became the norm, we had to adapt our approach. Flexible and remote working was quite a big differentiator before the pandemic. Now it isn’t. So, we’ve had to step up our game. Though having said that many of our competitors aren’t as flexible as first appear. Some firms set minimum expectations on the number of days worked in the office. Our approach is different with its flexible and remote work approach. We’re committed to our ‘work from anywhere, anytime, forever’ policy, which provides flexibility.
We’ve been trialling a shorter working week with our 100-80-100 approach. 100% of the productivity, 80% of the time and 100% of the pay. That trial has been amazing for finding efficiencies. Some believed the work could not fit into the amount of time, but when you start to unpick working practices, such as how often you check email, which adversely affects concentration, it is normally possible to find a couple of hours each day. The early results are highly promising. There’s nothing to suggest that reducing the number of hours worked is having an adverse impact on productivity; if anything, it’s having a positive impact.
Underpinning the rollout of these initiatives is our substantial investment in our managers. This in turn supports broader staff teams. The key is having really, really good people managers. All of our managers go through our ‘rebel managers’ training programme, based on Gallup’s studies into what makes the world’s greatest managers. It helps them to have better competency and strengths-based conversations. It also helps people to really identify what it is they love about their jobs and what they find draining so that they can carve out a role that really suits them.
The management training programmes have been intrinsic to developing our culture. Their importance is recognised throughout the business. It costs money and takes investment to put on the training programmes. Not just an investment of cash but a substantial investment of time. Our heads of departments could say, ‘I don’t want my managers attending because they need to focus on client delivery’, but we don’t have that. We have real support across the whole business that the return on investment of training is equally as important as going out to a client and getting hard cash.
We also set great store by frequently monitoring employee engagement and listening to staff feedback. We carry out a weekly happiness survey, which is conducted by an external provider, as well as some bigger surveys every few months. The surveys are anonymous but enable us to understand trends at a team level and quickly identify areas of the business where there is discontent and, most importantly, taking action. The key thing is not just listening to people, but also actually doing something about it. You can do all the feedback surveys in the world, but if nothing changes, people get complacent and think there is no point in giving feedback.
HR AS AN INVESTMENT NOT A COST
Support from senior management and the finance team – along with a significant allocation in the annual budget – has been essential. The people team budget is healthy. It allows us to do many things that other places aren’t doing. When I meet HR heads of other accountancy firms, they are often curious as to why we have such a big team. We do, but we couldn’t do half the well-being stuff, the engagement activity, if we didn’t have the people to do this. There’s been huge financial investment as part of a wider business strategy to do this.
Those investments have also included a greater focus on technology and working practices. We’ve invested heavily in technology and automation to improve processes. This has included a lot of investment in the people team to improve our own HR systems and improving our applicant tracking system. So, our candidates can have a better experience, so our managers can have a better experience. All of which ultimately benefits our clients.
As a result of all this activity our investments have certainly paid dividends in fostering a strong culture where employees both thrive and create a more productive firm. Yet, we’re not planning on standing still. There’s lots more that we can do. We’re learning all the time, and we’re now working with a private equity house that really gets our culture. All of which will help us build even more on what we are already doing.
In their latest major tech-enabled health services deal, our CP Deals team provided corporate finance advice to the Antser Group as it underwent a management buyout, backed by YFM Equity Partners (YFM).
Midlands-based Antser Group is a leading, tech-driven provider of assessments and social care training.
It comprises of Carter Brown, a Mansfield-based provider of independent psychological, psychiatric and social work assessments for child-related safeguarding, and Antser Learning, a Birmingham-based, VR-powered training tool for front-line children’s care practitioners.
Antser Group has a combined revenue of £10m, and the buyout transaction will allow them to build on past successes and strengthen their mission to provide better outcomes for children, young people, families, vulnerable adults and communities.
Antser CEO, Richard Dooner said:
“Cooper Parry helped us with the successful sale of Tri-x last year, so we were keen to work with them again on the buyout of the Antser Group. It certainly helped that they already had a good understanding of our business, the sector and our working style.
The transaction took a big effort from all involved, Andy, Ollie & their team persevered to help get the deal over the line successfully. We all at Antser are now very excited for what lies ahead in this new chapter with YFM.”
Andy Parker, Corporate Finance Partner, CP Deals, added:
“The CP Deals team continue to show their market knowledge and deal-making skills in the health and social care and technology sectors. We’ve had a strong relationship with the Antser team for some time now, so it’s great to have provided support on this landmark transaction and we wish them every success for the future.”
When Jeremy Hunt got to his feet in the Commons on Wednesday to deliver the Autumn Statement, R&D advisers were not surprised to hear that the two main R&D tax regimes are to be merged next year. After all, draft legislation had been in place for a few months, and it had been strongly suggested that this would happen – as we outlined in an earlier article on the topic.
The main points have been summarised below. Largely it’s good news for RDEC claimants but not so good for SMEs. We will of course be reflecting on the changes in the coming days and weeks and will be updating our clients with what this will mean in practice for them.
Merged Regime
- When? All changes will come into effect in respect of accounting periods starting on or after 1 April 2024. Hence the first claims impacted are for periods ending 31st March 2025. This is different compared to the draft legislation published in July which would have applied the changes to expenditure incurred on or after 1 April 2024. Thankfully, this gives current claimants, SMEs in particular, more time to assess their R&D positions.
- Rates: The rate offered under the merged scheme will be implemented at the current RDEC rate of 20%. Like under the RDEC regime, the 20% credit under the merged regime is taxable. At the main rate of 25% this results in a net tax benefit of 15%. However, the Autumn Statement adds that loss making companies apply a notional tax rate of 19% (instead of 25%) on the credit resulting in a net benefit of 16.2%. Good news for RDEC claimants. But a further blow for SMEs who’s rates already decreased from 1st April 2023 and will now decrease further (see exception below regarding SME intensive scheme).
- PAYE/NIC CAP: It will use the more generous version of the PAYE/NIC cap as currently used in the current SME regime, namely £20,000 plus 300% of the claimant company’s total PAYE and NIC contributions plus the PAYE and NIC contributions of connected EPWs or connected subcontractors at the level of their R&D involvement. Good news for RDEC claimants.
- Overseas Restrictions: As previously announced, restrictions on relief for expenditure on overseas EPWs and subcontractors will come into effect. This is for accounting periods starting on or after 1 April 2024. To qualify, the work undertaken by EPWs and subcontractors must have taken place within the UK. There are some exemptions, but these are niche.
- Subsidised expenditure: There won’t be any restrictions relating to subsidised expenditure, for example where companies are in receipt of grants to fund their R&D. Currently restrictions apply for SMEs who typically are still able to claim under the RDEC regime (hence under the merged regime this won’t really change the net position for SMEs).
- Subcontracting: Where a company subcontracts an R&D project, or a qualifying element of the project, the company contracting the work out can claim it. The Government wants the company making the decision to perform the R&D, and therefore bearing the risk, to get the relief. The company contracted to actually carry out that work may not claim for R&D activities. This expands the qualifying cost categories for current RDEC claimants who can’t claim subcontracted R&D (apart from some exceptions). SMEs can currently claim under the RDEC regime for work subcontracted to them by a Large Company, however under the merged regime they won’t be able to. This has big implications for sectors such as aerospace and automotive industries where supply chain companies are often reliant on work subcontracted to them. The new subcontracting rules will become an area of hot topic now Large Companies are able to claim and the distinction between subcontracted R&D and subcontractors “providing a service” will require greater focus. This is a topic for discussion in itself.
- Cost categories: Cloud, data and maths costs, which came into effect as new types of claimable costs from 1 April 2023, will continue to be eligible under the merged regime.
SME intensive scheme
- The ‘SME intensive scheme’, for the most R&D intensive loss-making SMEs was announced at Spring Budget 2023 for R&D expenditure made on or after 1 April 2023.
- A company was originally considered to be R&D intensive where its qualifying R&D expenditure was 40% or more of its total expenditure. This amount will be reduced from 40% to 30% of total expenditure for accounting periods starting on or after 1 April 2024.
- A year of grace will be introduced to help in situations where exceptional spending might skew a SME’s intensity ratio for a year which would have led to the business moving out of the intensive SME regime.
The confirmation from the Chancellor of this merged regime finally provides the R&D sector with some certainty during a year of upheaval. A boost for RDEC claimants surely but additional blows for SMEs sadly.
If you’d like to discuss any points in the article, please get in touch.
On Thursday 16 November, the CP Deals team welcomed Managing Partners, CEOs and senior leaders from a number of professional services firms to Soho’s award-winning Bocca Di Lupo.
On the agenda, a delicious roundtable lunch, paired with a lively discussion that captured our guests’ insights and best practice tips, based on their experiences of living through a transaction and working alongside investors.
We were delighted to welcome guests from a range of sectors, including legal firms, ESG advisory, pensions and insurance.
The afternoon treated us to a whole host of questions, recurring themes and brilliant tips, and we’ve summarised all the best bits below.
ROUNDTABLE ROUNDUP: KEY TOPICS
1) What makes a professional services company attractive to private equity?
A massively important question, but one which our leaders had no trouble answering.
In their experience, private equity investors look for high-quality, strong, strategically focused management teams and favour companies with a diverse range of services to spread risk, recurring revenue and a B2B model for greater resilience in the face of recession.
There is a strong investor interest in professional services right now due to the fragmented nature of the market and the buy and build opportunity this brings. Increasing regulation is driving consolidation in the sector – we’ve seen similar regulatory pressure in healthcare (CQC) and financial services (FCA).
A business that can demonstrate successful acquisitions already or present a list of potential acquisition targets, to enhance their own growth story is particularly attractive.
Many businesses in the sector have achieved a certain scale organically and by tuck-in acquisitions but see a ceiling in their growth trajectory. Private equity investors, with their deep pockets, can supercharge this growth through acquisition and through investment in technology.
It was widely acknowledged that the inability to invest sufficiently in technology, particularly AI, is a real issue for the longer term, as there is a risk of being left behind.
2) Private Equity investor involvement
Our guests were keen to know how much day-to-day involvement private equity investors have, and what this looks like?
CEOs need to get used to having a boss again. This does however provide a sounding board to run big decisions past before turning ideas into reality. Our guests agreed private equity investors typically provide quick decisions supported by data, so long-drawn-out board decisions are a thing of the past.
Also, guests were keen to understand what it means practically for the second tier of management when investors come on board and how to best incentivise them, whether it be a bonus, a long-term incentive plan or sweet equity.
3) The importance of KPIs
When you’re working with private equity investors, it can take time to get used to the importance they place on KPIs.
You’ll notice a step change in the reporting demands and the sophistication of the data analysis to support decision making.
The positive is private equity can be objective. They don’t dwell on dips. Instead, they just want to implement change to grow – it can be more difficult for a founder to do the same, who is so emotionally involved in their business.
4) Culture remains key
With professional services firms being ‘people businesses’, their ability to attract and retain top talent is important to investors. What’s more, how well the business can protect and evolve that culture post-investment will be scrutinised, especially as it scales and welcomes more people.
When businesses grow quickly, they can lose the personal touch that made them a great place to work in the first place. We listened to examples where external experts came into a business, asked their people a series of questions and performed an evaluation of their culture from the bottom up, so investors could focus on the aspects that mattered most going forward.
With private equity rollups companies growing quickly, maintaining culture is more difficult, and it’s never been more important for owners to set an example and lead from the front.
It was unanimously agreed that owners need to communicate, embed and embody a clear vision on culture, that needs to flow through the senior management team and beyond so everyone else in the business can bring it to life.
Our professional services guests spoke of managing generational divides and expectations, particularly around working practices (office-based vs. working from home) and the fact that younger generations tend to think in the shorter term than their older counterparts.
THE TABLE’S TOP TIPS
To wrap up our summary of a fascinating afternoon, we wanted to share some final tips from our professional services leaders.
Firstly, thinking two steps ahead. Who are your buyers? And who will be the next buyer?
Secondly, the importance of Vendor Due Diligence (VDD) as part of a transaction – a hugely beneficial step that more than pays for itself.
Thirdly, engaging with the right advisors early on to navigate business owners and management teams through a process.
Finally, preparing and rehearsing your management presentation to buyers to make sure you’re all aligned and own the information memorandum is one of the best ways to make the process as smooth as possible.
Thank you to all our guests for an excellent roundtable discussion.
Get in touch if you’d like to be part of the next event.
As Jeremy Hunt stepped up to deliver his much-anticipated Autumn Statement to the House of Commons, he did so against a backdrop of division in the UK. How well could the government’s new tax and spending plans patch things up?
Labour said no matter what Hunt announced, nothing could change the Conservatives’ “appalling record” on the economy. In predictably contrary fashion, Hunt said the government’s economic plans are working, “but the work is not done.”
So, as the Chancellor set about his work, unveiling what he called an “Autumn Statement for growth”, our team set about theirs, sifting through all the key updates to bring you this summary below.
For some, heart-warming news. For others, a stone-cold damp squib. To get the finer detail beyond these headlines, scroll down to read our full Autumn Statement summary.
Highlights for businesses
- Capital allowances “full expensing”, a tax break that allows businesses to claim back 25p in corporation tax for every £1 they invest in IT, plant and machinery has been made permanent. This was originally announced to last for 3 years to 31 March 2026.
- The merging of the RDEC and SME R&D regimes has been confirmed for accounting periods starting on or after 1 April 2024, with a headline rate of 20%.
- Financial incentives for Investment Zones and tax reliefs for Freeports have been extended from 5 to 10 years. New Investment Zones have been announced which will include both the East and West Midlands.
- Technical Consultations to commence in 2024 to simplify Plant & Machinery Allowances and to extend First Year Allowances to leased plant and equipment. The latter will be welcomed by companies within the construction sector.
- EIS and VCT sunset clause extended until April 2035.
- The 75% discount on business rates up to £110,000 for retail, hospitality and leisure businesses has been extended for another year.
- The small businesses rates multiplier will be frozen for a year.
- Alcohol duty has been frozen until 1 August 2024, while tobacco duty has been put up by 10%.
- The zero rate VAT relief on women’s sanitary products will be extended to include reusable period underwear from 1 January 2024.
- The VAT relief available on the installation of energy-saving materials will be extended to additional technologies, and widening the type of residential buildings to which the relief attaches from February 2024.
- Legislation will be introduced to increase the rate of plastic packaging tax in line with CPI. The change will take effect from 1 April 2024.
- Legislation will be introduced in the Autumn Finance Bill 2023 to clarify how VAT and excise law should be interpreted moving forward, with the purpose of ensuring that UK VAT and excise legislation is interpreted as parliament intended under UK law.
- The government will shortly publish a consultation on proposals to bring remote gambling (meaning gambling offered over the internet, telephone, TV and radio) into a single tax, rather than taxing it through a three-tax structure.
- Employers of veterans will see National Insurance relief extended for one year from April 2024.
- The government has pledged funding of £50m over the next two years to pilot ways to increase the number of apprentices in engineering and other key “growth” sectors.
- The Chancellor has announced a £320 million plan to drive innovation and unlock the first tranche of investment from his Mansion House Reforms, which include initiatives to consolidate the defined contribution and defined benefit pensions sectors, and to encourage greater investment by pension funds in UK companies.
- Legislation will be introduced in the Autumn Finance Bill 2023 to enable HMRC to reduce the PAYE liability of a “deemed employer” to offset taxes paid directly by a worker and their intermediary on payments received where an error has been made in applying the off-payroll (IR35) working rules.
- Legislation requiring employers, company directors, and the self-employed to provide new or improved data to HMRC will be enacted to enable better outcomes for citizens and businesses. These changes will take effect from the tax year 2025-26.
Highlights for individuals
- The main National Insurance rate for employees will be cut from 12% to 10% from 6 January 2024.
- From 6 April 2024, self-employed people will no longer have to pay Class 2 National Insurance and the main rate of Class 4 National Insurance falls from 9% to 8%.
- Income tax rates and thresholds remain frozen.
- The pensions Lifetime Allowance is being abolished from 6 April 2024 as previously announced. The maximum tax-free lump sum will be 25% of the present lifetime allowance – so £268,275. This will be different where protections apply.
- State pension to increase by 8.5% from April 2024 to £221.20 a week.
- The national living wage will rise to £11.44 an hour in April 2024 (previously £10.42).
- Universal credit and disability benefits will increase by 6.7%, in line with September’s inflation rate.
LOOKING FOR MORE DETAIL?
Click the image below to read our full Autumn Statement summary.
In a year that’s felt full of them, today marks a truly game-changing moment for CP. After exchanging in September, we’ve now completed the deal with Haines Watts.
That means its London and associated audit and advisory businesses across the South-East and the Midlands (HWSE) have officially joined the CP team.
12 months in the making, the deal propels CP to £125m turnover, adds 11 offices, 63 partners and increases our headcount to 1,150 people. It takes us to the next level as a genuine UK mid-market heavyweight and the UK’s 11th largest accountancy firm, marking a tripling in size over the last 12 months since we partnered with Waterland Private Equity.
HWSE’s ex-Managing Partner, Michael Davidson, joins the CP Executive Team as Chief Growth Officer. He’ll be laser-focused on driving business growth and underlining our determination to create the UK’s next-gen accountancy firm.
The deal – alongside some high-profile strategic hires – powers us towards being a full UK and Ireland-wide firm, taking our latest people count to over 500 in London and the South-East alone.
After completing six deals in 10 months, we’re also on track to achieve our 5 Year Plan well ahead of schedule. Underpinned by strong 33% organic growth for the first half of the current financial year, we’re on course to double in size again over the next 2 years.
Ade Cheatham, our CEO, said:
“Completing this deal is very special. Michael and his team have created an outstanding business and the ‘fit’ between us both is spot on. No question, we are better together.
I’m genuinely thrilled to be welcoming so many talented people to the CP team. Together, our complementary cultures, knowledgeable teams, and a tech-enabled approach will deliver an even more enhanced client experience.
The news is timely too, as only a few days ago it was announced that for the seventh year, we’ve made it into the UK’s Top 100 Best Companies to Work For list, as the 30th Best Large Company to Work For. And we are still recognised as the #1 Accountancy Firm to Work For in the UK.
Closing deals like this while maintaining exceptional performance for our clients is never easy. I’m incredibly proud of everyone’s efforts in getting each of these six deals over the line in such a short period of time. This year has been transformational for the firm. Looking ahead to the next phase is equally exciting.”
Michael Davidson, Chief Growth Officer, added:
“I’m delighted how this has all come together. Working collaboratively on the integration over the last year has ensured that all the team and our clients have been up to speed with every
key milestone. The work the team has already done to combine the two businesses means we’ll hit the ground running from day one.”
Simon Nichols joins the CP Deals team in London as our ambitious growth plans continue at pace.
Simon Nichols, former Partner and Head of Transaction Services at Azets, has joined Cooper Parry as a Transaction Services Partner.
Simon will lead our London & South East Transaction Services operations as part of our fast-growing, nationwide CP Deals team. CP Deals offers a comprehensive M&A solution to the mid-market space, combining market-leading expertise across Corporate Finance, Transaction Services and Transaction Tax.
Simon brings with him 23 years of equity and debt deal experience in leading both mid-market and cross-border, multi-disciplinary teams on global and domestic acquisitions, demergers, disposals and capital market transactions. That includes an 8-year stint as a Partner in KPMG’s London Deals team.
After moving to Azets, Simon continued to develop his skills in the mid-market, advising owner-managed and private equity-backed businesses, private equity investors and lenders with deep sector experience covering energy and natural resources, healthcare and life sciences.
This sector experience aligns closely with the CP Deals team’s specialisms, and Simon’s arrival will supercharge a team that continues to go from strength to strength, with industry leaders like Timothy Mahapatra, Head of Deals, and Paul Tallon, Transaction Services Partner, joining in the last year alone.
Simon Nichols, Transaction Services Partner at Cooper Parry, said:
“The CP Deals team has spotted a massive market opportunity servicing clients in the lower mid-market, and I’m excited to join them and play a key role in driving that forward.
We believe there is currently a gap in the market for a boutique style, ‘hands on’ Partner-led Transaction Services offering, further building on the recent joining of Paul Tallon who is leading our Transaction Services team in the Midlands. We have a senior team of very experienced deal specialists who can provide commercial and insightful advice across deals by delivering a fully integrated Deals offering.
We want to build long-term business relationships and be seen as trusted advisors to our clients – ensuring that they maximise the value obtained from their deals, while also accelerating the speed of deal execution.”
Timothy Mahapatra, Head of CP Deals, added:
“Welcoming someone as well-renowned as Simon to the team is always a special moment. He adds vital skills, sector expertise and experience at a time when our growth plans for the next few years are already progressing rapidly.
More key hires will follow, particularly in London, and Simon and his team will be working in tandem with the wider CP Deals team supporting our clients with integrated Deals solutions to add value across the M&A cycle.”
Head of Tech & High Growth Tax, James Peck and Tax Director, Cris Medori, take you through US expansion month by month.
Your go to guide for tackling all the common themes that might come up as you embark on this exciting, yet sometimes daunting, journey.
