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Autumn Statement: Better than expected?


Autumn Statement gloomy outlook

We predicted a gloomy economic outlook, but we expected worse news. That also seems to be the rhetoric from many people after yesterday’s Autumn Statement announcements.

‘Eye watering’ tax increases were expected, as well as potential percentage points added to dividend and income tax rates which never materialised.

The main driver for the announced tax rises is the ‘fiscal drag’, essentially a slowing in the economy’s growth. Tax bands and allowances were frozen, meaning more people would pay taxes for the first time or higher rates.

It seems business owners are in a rock and a hard place. After all, when one eye is fixed upon your destination, only one eye is left to find the Way. The Autumn Statement and prior reversal of tax reversals have not made it easy, and now business owners face more obstacles to navigate.

What are the problems of a higher tax burden?

We are on course for the highest tax burden since WW2.

The dividend allowance has been halved and is to reduce further in 2024. The additional rate at which individuals pay 45% is also now reduced. Add to the mix the increase in the corporation tax rate to 25%; many businesses will be reviewing how they can manage the new tax burden.

Businesses may find it challenging to grow and expand in this environment. And with R&D relief also being struck with the incentives reduced, it looks like an anti-growth set of policies.

A lack of staff, inflation hitting the cost base, and increased living wage will further burden businesses, especially those in the hospitality sector.

Energy support for business will likely reduce significantly in 2023; a consultation on this support is due in December 2022. One good change for those businesses was the increase in support for business rates in the hospitality and retail sectors, with this increasing from 50%-75%

Glenn Collins, Head of technical and Strategic Engagement at ACCA, commented on tax policies: “While a route map for tax changes ahead is useful, wage inflation has raised the spectre of fiscal drag. Scrutiny and transparency about the implications of these tax changes will be key, especially where taxpayers find themselves subject to additional administrative requirements. Many more businesses (and individuals) will find themselves caught in the VAT and CGT regimes at a time when HMRC is already under severe pressure.

“The aim of the statement, it appears, was to provide stability and show how we are fiscally more responsible. The picture painted was gloomy, and with the war in Ukrainian driving the cost of energy up and impacting inflation, the growth forecast for the UK is still below pre-pandemic levels, which is slower than other countries. Should there have been more incentives and impetus for growth? Taxing and reducing spending too far can not quickly drag us out of this recession. We shall wait and see; businesses need more help now than ever to navigate these changes and plan a way through.”

Small businesses must now take stock and plan ahead in 2023. Looking at costs, cash flow, and overall business strategy to remain profitable will be critical to survival and growth. 

At Grenfell James, we work with ambitious companies across Warwickshire and London, using technology to simplify processes and accelerate business growth. If you need help or advice with your business growth plans, tax efficiency or profitability, don’t hesitate to contact the Grenfell James team at 01789 294 484.  

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Grenfell James Technology Adoption Index

How does your business perform against others adopting financial tech? Find out with our interactive diagnostic:


How does your business receive invoices?


Invoices are mainly received in paper form


Invoices are mainly received by email


Invoices are emailed then automatically forwarded to a designated mailbox


How are purchase invoices processed?


Invoices are entered manually


Invoices are attached to manually raised invoices


Automated software (e.g. ReceiptBank, 1Tap, HubDoc etc) collates invoices


How are accounts processed?


Using Excel/paper-based


Using Computer-based, offline software


Using cloud-based accountancy software


How often is business data revised?


Data is updated annually


Data is updated quarterly


Data is updated monthly or more often


How is banking updated for your business?


Banking is updated manually


Banking is updated by imports


Banking is updated via a live feed


How are bank payments made?


Bank payments are manual


Bank payments are made using bulk imports


Bank payments are made directly via accounting software


How are bank receipts reconciled?


Receipts are chased and reconciled manually


Receipts are chased and reconciled automatically


A third-party platform is used to chase debts and collect fees


How often are management reports produced?


No reports are provided


Reports are provided but often too late to be valuable


Reports are automated with real-time information

Score 8-12:

Curious Exploration

Your financial technology phase is Curious Exploration

% of respondent businesses are in this phase too.

Switching accountancy systems may seem like an upheaval, but can be much more straightforward than most businesses imagine. From talking to our clients, they have found moving from paper invoicing and desktop-based accounting software to the cloud and apps quickly makes the transition process a worthwhile investment of time. Digital accounting solutions bring in streamlined processes, up-to-date business data and greater confidence in the accuracy of information when making financial decisions.

Grenfell James works with your team to fully assess the needs of your business and minimise the impact of any transitions for solutions we recommend.

Find out more about App Advisory


Score 13-19:

Measured Discovery

Your financial technology phase is Measured Discovery

% of respondent businesses are in this phase too.

Once cloud accountancy software is in place, there’s still plenty of scope to improve your accountancy processes and make sure your business is maximising the benefits of adopting a digital accounting solution. Grenfell James assesses each business to understand how any implemented solutions are being used, identify areas for improvement and the needs of the business overall to support your business goals and achieve success.

Our team of experts can discuss a range of time-saving automation and get different apps and cloud-based solutions talking to create and manage a digital accountancy eco-system to help your business grow.

Find out more about App Advisory


Score 20-24:

Bold Innovation

Your financial technology phase is Bold Innovation

% of respondent businesses are in this phase too.

You know the benefits of accounting technology and the impact it can have on your business goals. If you want to take it a step further, our team can conduct a systematic review of your processes, apps and business goals to ensure your digital accountancy ecosystem is keeping pace with the changing needs of a growing business.