Depending on where you live, you may have already noticed children steadily making their way back to school – or heard the teachers in your life lament the end of the summer holidays.
As children swap the high street for homework, the Great British Summer Savings scheme comes to an end.
Businesses no longer benefit from a reduction in VAT rates, so now must consider what is next and how to continue to push back against the ongoing economic challenges.
The full impact of the Great British Summer Savings scheme is unlikely to be fully understood anytime soon, but it is possible to get a sense of how the scheme was received by businesses.
There were distinct positive aspects that have been reported by business owners who would likely take any form of relief with a smile, as it helps to lessen the burden facing many businesses in the UK at the moment.
While the Government had hoped that the savings would be passed to the consumer, the lack of enforcement of this meant that businesses were able to adjust their strategy to best suit their needs.
While many did discount the selected services, other businesses elected to keep the funds for necessary investments that could safeguard the company in the coming months.
To make the most of the scheme, some businesses added additional children’s meals, knowing that the offset in VAT would enable them to expand service offerings without negatively impacting budgets.
However, not every business received the Great British Summer Savings scheme positively.
Some felt that the VAT considerations were too complex to handle given the relatively short notice of the scheme issued by the Government and the brevity of the scheme itself.
As such, these businesses ran offers of giving free children’s meals with other purchases as a way of drawing in additional customers.
A lack of general awareness of the scheme was also highlighted as a pitfall, signalling that some customers may have stayed away due to a lack of awareness that prices may have been lower than expected.
Businesses that were affected by the Great British Summer Savings scheme need to ensure that the lower rate of VAT is no longer applied to any of their offerings and that records are adjusted to reflect the change.
If not managed carefully, there could be a swathe of non-compliance when businesses come to file their next VAT return.
More generally, businesses have had a taste of the financial power that comes from a relief on obligations.
It is possible that the reception to the Great British Summer Savings scheme could inform some of the new Chancellor’s plans in the Autumn Budget, which is set to be announced on 28 October.
While it would be unwise to speculate on the upcoming announcement, it is apparent that small businesses have an appetite for reliefs that will allow them to better manage the ongoing economic pressures they face.
It can be hoped that future provisions extend beyond the hospitality sector to better revitalise a broader range of UK businesses.
Regardless of what the future may hold, it is clear that businesses benefit from greater control of their finances.
By getting help from our expert accounting team, you can have a stronger sense of your financial position and how to operate effectively.
We can work with you to ensure that you are fully tax compliant while operating in a tax-efficient way, something particularly useful if you are concerned about your next VAT filing.
For accounting support that empowers you in every season, speak to our team.
