Weybridge-based accountants MGI Midgley Snelling LLP has welcomed the Government’s latest raft of measures but said it is time that businesses seek help to ensure security for the future in these uncertain times.
In the last week, the Government has announced a raft of changes and billions of pounds worth of funding to help shore up the UK’s struggling small businesses.
Despite these steps and promises of further measures, Sarah Squires, Partner at MGI Midgley Snelling LLP, says businesses need to be taking action now to make use of what has been offered to them and strive to succeed through tough times.
“The next few months are going to be very difficult even with the measures that the Government is taking and businesses need to review their current arrangements and seek professional advice to ensure they have solid foundations from which to build on once this crisis has subsided,” said Sarah.
The firm said offers of loans of up to £5 million, with zero-interest for the first six months for small businesses were helpful, as were existing steps to cut business rates and pick up the bill for statutory sick pay, but that in reality, many businesses would have to take more drastic steps to maintain cashflow.
Sarah said: “It is important, first and foremost that businesses take steps to protect their staff members and should by now have prepared a coronavirus policy to keep staff, their families and customers safe.
“This must be communicated with staff as soon as possible. By putting a robust plan in place, that takes in considerations such as home working or double shifts, businesses can extend their operations through the pandemic.”
MGI Midgley Snelling LLP is also calling on businesses to consider the deferment of tax payments and to seek breaks on debts where possible.
HMRC is already offering time to pay applications and may even waive interest and penalties on late payments for those struggling to make tax payments, explained Sarah.
“Businesses also need to think about reducing all non-essential costs and financial outgoings as quickly as possible,” added Sarah.
“Regrettably, at some point, for some businesses, it may become necessary to cut staffing levels to those necessary to meet current or expected sales levels.
“In light of this, employers should review their existing employment contracts and consider varying terms and conditions such as negotiating amended hours, salary reductions or unpaid leave with staff. Firms may also be able to ask some staff to take any holidays now.”
MGI Midgley Snelling LLP also recommended that businesses check notice periods to put people on short-time working or where necessary temporarily lay people off.
“Unfortunately, it may come to a point, despite the best efforts of a business, where businesses need to make redundancies and it is important at this stage that businesses consider the costs involved in doing this and think how they can be managed.”
Although MGI Midgley Snelling LLP hopes that the region’s businesses will not be required to take these drastic steps, it has said that it is important that they are prepared and have taken the proper advice in order to do so.