5 Key Financial Tips for Businesses in Berkshire 2023
We have for you five key financial considerations that businesses must be aware of in order to ensure their long-term success in 2023.
Our considerations include monitoring overall economic trends, such as economic growth, cost-of-living crisis, inflation rates, interest rates, government policies, and increased pressure for sustainable investments.
Keep reading to learn in detail the latest updates to prepare for in the up-in-coming months to further improve business financial performance.
1. 2023 UK Business Forecast: Economic Outlook
The UK’s economy is likely to perform worse than other advanced economies and will contract by 0.6% in 2023, according to the International Monetary Fund (IMF). This is in contrast to its earlier prediction that the economy would grow slightly. However, the IMF said it believed the UK is on the right track.
Source: BBC News
2. Interest & Inflation Rates: Impact on Businesses
The Bank of England’s Monetary Policy Committee has voted to increase the Bank Rate by 0.5 percentage points to 4%. The decision was made in response to higher-than-expected inflation in the UK driven by both domestic and global factors.
The MPC’s remit is to maintain price stability and meet the 2% inflation target while supporting economic growth and employment. Monetary policy will be adjusted as necessary to achieve these goals sustainably in the medium term.
Although global consumer price inflation remains high, it seems to have peaked in several advanced economies, including the UK. Many central banks have tightened monetary policy, but market pricing suggests that policy rates will decrease in the future.
We recommend overseeing interest rate fluctuations and analysing how each percentage change will impact your business constantly and carefully to curate a solid-proof strategy moving forward.
At Edmonds Accountancy, we are more than happy to help. Book us in today for a free consultation and we can provide expert advice for all accountancy needs.
Source: Bank of England
3. Managing Cost-of-Living: Financial Strategies for Businesses
A cost-of-living crisis and inflation can have many effects on businesses. Some potential impacts are increased costs, reduced consumer spending, higher interest rates, wage pressure, and supply chain disruptions.
In general, a cost of living crisis and inflation can make it more challenging for businesses to maintain profitability and growth. To address the current pressures on businesses, it is important to consider rising costs, decreasing revenues, tax increases, and supply chain difficulties.
With years of experience in supporting businesses, we can offer valuable advice and solutions to help entrepreneurs successfully manage their financial affairs. At our firm, we are dedicated to helping our clients overcome obstacles and achieve success. By reaching out to us, we can discuss your options and explore new possibilities to resolve any financial difficulties.
4. UK Corporation Tax: Navigating the Changes
Effective 1 April 2023, Corporation Tax main rate for profits over £250,000 will increase to 25%. A Small Profits Rate of 19% will apply to profits up to £50,000, while profits between £50,000 and £250,000 will be subject to a marginal rate. Short accounting periods and associated companies will have reduced limits. The marginal relief gradually increases the tax from 19% to 25%.
To check eligibility for marginal relief, businesses can use the HMRC online calculator. Consider reviewing associated company relationships to avoid losing the lower rate. Seek professional advice with us to minimise the negative financial impact.
Source: HM Revenue & Customs
5. Calculating Economic: Key Financial Business Considerations
The issue of environmental sustainability has been gaining momentum in recent years, and as we move into 2023 and beyond, it is becoming increasingly clear that it will play a more significant role in day-to-day business operations.
As governments around the world set more aggressive targets to combat climate change and reduce greenhouse gas emissions, businesses are under pressure to keep pace.
As a result, businesses must take a holistic approach to sustainability beyond reducing carbon emissions. Demonstrating commitment to sustainability can help businesses retain customers, access capital, and achieve long-term success. Although it requires investment, it also offers opportunities to differentiate and improve its reputation.
Financial Solutions for Staying Ahead of Economic Challenges
Accountancy services can improve a business’s financial performance in uncertain economic times by providing accurate financial information and analysis to help businesses minimise risk and maximise profitability.
Accountants can help with cost savings, cash flow management, and effective tax strategies, and provide insights into key performance indicators. Outsourcing accounting needs allows businesses to focus on their core operations, gain a competitive edge, and navigate economic uncertainties.
Trusted Accountancy Services in Berkshire
We are Edmonds Accountancy, a professional and reliable accountancy firm.
We offer high-quality accountancy and tax solutions to help businesses achieve a prosperous future. Our exceptional client support and business advice cater to all business types. Contact us for a free consultation on how we can add value to your business and help you achieve your goals.