It is no longer just the grass that is brown as the changing seasons are being reflected on the leaves of the UK’s deciduous trees.
While the leaves may begin to fall, the rates of VAT have now risen for many hospitality businesses that benefited from the Great British Summer Savings scheme.
With the scheme over, it is time to consider its impact on businesses and how all businesses should be adapting to the fresh challenges of the coming months.
Was the Great British Summer Savings scheme helpful?
While it is likely too early to be able to estimate the full impact of the Great British Summer Savings scheme, the reduction in the rates of VAT for select services was generally received positively by businesses.
The flexibility with which businesses were able to adapt to the policy ensured that each business could find a solution that was most beneficial to them.
There are reports of some businesses adding additional children’s meals, able to afford the added expense due to the VAT relief, as a way of driving up business.
However, the complexity of applying the scheme and the relatively short notice that was issued by the Government was criticised by businesses.
To avoid having to handle the rule changes, some businesses elected to run offers where children ate for free and used this as a marketing opportunity to draw in larger crowds.
Other businesses did not pass savings to customers but instead used the additional funds to invest in the business.
As such, it is clear that, while the Great British Summer Savings scheme was beneficial in some capacity, it has not provided a universal solution to the challenges businesses face.
What happens now that the Great British Summer Savings scheme is over?
For the businesses that were overlooked by the Government this summer, the ending of the Great British Summer Savings scheme makes little difference.
Those that were impacted need to be diligent in ensuring that all pricing is now accurate for the usual application of VAT rates.
It may also be necessary to approach the next VAT return with the information relating to the Great British Summer Savings scheme in mind to ensure that records are accurate.
More broadly, the Great British Summer Savings scheme revealed a need for businesses to be given some relief from their financial obligations in order to meet the rising economic challenges that threaten growth.
Many business owners have expressed a desire to see a similar scheme applied in the coming months, but it is unlikely that such policies would be declared before the Autumn Budget on 28 October.
However, the success of the Great British Summer Savings scheme may signal to the new Chancellor the impact of adjusting the obligations of businesses to better suit economic circumstances.
It would be hoped that any future reliefs for businesses would be more widespread to address the concerns of those operating in different sectors.
While it would be unwise to speculate on the Autumn Budget, businesses can seek accounting support to determine whether there are ways of operating more efficiently, particularly when it comes to tax exposure.
Our expert team is on hand to support your business through the coming months and will help you to understand how the Autumn Budget will affect your specific circumstances.
When the time comes to file your VAT return, we can ensure you are fully compliant, whether the Great British Summer Savings scheme applied to your business or not.
Get in touch for expert assistance in keeping your business efficient in every season.
