BUSINESS NEWS – 20TH DECEMBER 2021

Date Added | December 21, 2021

As part of 2020’s commitment to its members by providing online training for accountants in practice, we have provided a Business News Update for our members.

This will be our last business newsletter before Christmas and the New Year break so let us wish you a happy Christmas and a prosperous New Year.

2021 – A year of resilience and recovery?

Let us have hope that in 2022 we return to a more normal way of life free of the restrictions that we have faced over the last two years.   

The pandemic happened and now is not the time to reflect how it happened or judge how it was managed, indeed further restrictions have recently been introduced and all we can do is take precautions individually to prevent the Omicron virus spreading and continue to take responsibility in the community to socially distance and help prevent the spread.

This year, despite the lockdowns and restrictions, we have been amazed at the resilience of clients and how they have energetically repurposed or pivoted their businesses into new areas, products and services. Businesses have redesigned delivery and payment systems, moved their entire processes digital, accepted remote working or new safe working environments and adopted to new technologies to survive and indeed prosper in the Covid-19 era.

Clients have demonstrated to us how we can all readily adapt to a change in circumstances and have given us inspiration and optimism for the future. We believe that by this time next year we will be back to where we want to be and more of our daily lives will resemble some kind of normality again. Do not give in to the virus, stay strong, be resilient and together we will move forward!

Job vacancies continue to rise!

The Office for National Statistics (ONS) estimate that between August to October there was a   continuing recovery in the labour market, with a quarterly increase in the employment rate, while the unemployment rate decreased. Total hours worked increased on the quarter, due to the relaxing of some coronavirus (COVID-19) restrictions but are still below pre-coronavirus levels. The UK employment rate was estimated at 75.5%, 1.1 percentage points lower than before the coronavirus pandemic (December 2019 to February 2020), but 0.2 percentage points higher than the previous quarter (May to July 2021).

The UK unemployment rate was estimated at 4.2%, 0.2 percentage points higher than before the pandemic, but 0.4 percentage points lower than the previous quarter. The economic inactivity rate was estimated at 21.2%, 1.0 percentage point higher than before the pandemic, and 0.1 percentage points higher than the previous quarter.

The number of people in part-time work jumped in the three months to October, after falling sharply during the pandemic and there was also a fall in unemployment among 16-24 year-olds, another group initially hit by the crisis.

Unemployment continues to fall after a spike last year, with job vacancies now at a fresh record high.

HMRC Employer Bulletin December 2021

The December edition of the Employer Bulletin brings you all the latest HMRC updates and guidance to support employers and payroll agents.

There is important information on:

  • PAYE – there is important information for those who pay employees early for Christmas, and advice on how to prevent and correct payroll errors
  • UK Transition and the recently agreed UK-Swiss Convention on Social Security coordination which came into force on 1 November 2021 
  • coronavirus (COVID-19) summary of guidance published by HMRC, and declaring grants on tax returns 
  • tax updates and changes to guidance, with information on the tax avoidance campaign

UK average house prices increased by 10.2% over the year to October 2021

The Office for National Statistics (ONS) latest figures show the UK’s average house price increased by 10.2% over the year to October, down from 12.3% in the year to September 2021. The average UK house price was £268,000 in October 2021, which is £24,000 higher than this time last year.

The temporary changes to Stamp Duty, Land and Buildings Transaction Tax, and Land Transaction Tax may have allowed sellers to request higher prices as buyers’ overall costs are reduced. As the tax breaks were originally due to conclude at the end of March 2021, it is likely that March’s average house prices were slightly inflated as buyers rushed to ensure their house purchases were scheduled to complete ahead of this deadline.

This effect was then further exaggerated in June 2021, in line with the extension to the holiday on taxes paid on property purchases in England, Wales and Northern Ireland. Following a decrease in July, average house prices increased in the months of August and September 2021, reaching a record level in September 2021 (when the last of the tax holidays came to an end in England). Despite a slight fall in the month of October 2021, average house prices remain higher than the previous peak seen in June.

Private rental prices paid by tenants in the UK rose by 1.7% in the 12 months to November 2021, up from 1.6% in the 12 months to October 2021. The beginning of 2021 saw a slowdown in rental price growth, which was driven by prices in London.

In England the October data shows, on average, house prices have fallen by 1.5% since September 2021. The annual price rise of 9.8% takes the average property value to £285,113.

Inflation at its highest rate in over a decade

Consumer prices rose by 4.6% in the 12 months to November 2021, according to the lead measure of the Consumer Prices Index including owner occupiers’ housing costs (CPIH). This is up from 3.8% in the year to October 2021. Annual inflation rates at this time are influenced by the effects of coronavirus (COVID-19) in 2020.

The Consumer Price Index (CPI) also rose from 4.2% to 5.1% in November 2021.

A wide range of prices contributed to the rise in inflation, with the largest upward contributions coming from motor fuels as well as clothing and footwear, where prices rose this year but fell a year ago.

International travel update

From 15 December 2021, all remaining countries were removed from the UK travel red list. The red list policy and additional testing measures in response to Omicron remain in place. As such, passengers arriving from Angola, Botswana, Eswatini, Lesotho, Malawi, Mozambique, Namibia, Nigeria, South Africa, Zambia and Zimbabwe will not have to stay in a managed quarantine hotel on arrival from this date. Pre-departure tests and PCR testing measures on or before day 2 remain in place, with a review of all travel measures in the new year. Airlines must continue to check all passengers for pre-departure tests alongside their completed Passenger Locator Form, and passengers will not be allowed to board a flight without providing evidence of a negative test result.

Advice for pregnant employees

The advice for pregnant employees on risk assessments in the workplace and occupational health during the coronavirus (COVID-19) pandemic has been updated to reflect recent government announcements. This advice is for you if you are pregnant and working as an employee. This includes pregnant healthcare professionals. It will help you discuss with your line manager and occupational health team how best to ensure health and safety in the workplace.

Finding and choosing a private coronavirus (COVID-19) test provider

The lists of and information about private test providers, to help you get the private COVID-19 tests you need, has again been updated.

Second State Pension Age Review launches

The Review will consider whether the rules around pensionable age are appropriate, based on the latest life expectancy data and other evidence.

The Pensions Act 2014 requires the government to regularly review State Pension age, and in accordance with law, this latest Review must be published by 7 May 2023.

State Pension age is currently 66 and two further increases are currently set out in legislation: a gradual rise to 67 for those born on or after April 1960; and a gradual rise to 68 between 2044 and 2046 for those born on or after April 1977. The first Review of State Pension age was undertaken in 2017 and concluded that the next Review should consider whether the increase to age 68 should be brought forward to 2037-39 before tabling any changes to legislation.

This Review will consider a wide range of evidence, for example, it will:

  • examine the implications of the latest life expectancy data;
  • provide a balanced assessment of the costs of an ageing population and future State Pension expenditure;
  • consider labour market changes and people’s ability and opportunities to work over State Pension age;
  • and develop options for setting the legislative timetable for State Pension age that are transparent and fair.

Using your NHS COVID Pass for travel abroad and at venues and settings in England

How to use the NHS COVID Pass to demonstrate your coronavirus (COVID-19) status when travelling abroad and domestically at venues and settings in England.

From Wednesday 15 December the coronavirus (COVID-19) rules for visiting certain venues and events changed. To enter certain venues and events in England you must have proof that you:

  • are vaccinated with 2 doses of an approved vaccine (or one of the single-dose Janssen vaccine) – the government will keep this under review as boosters are rolled out
  • have taken a PCR or rapid lateral flow test within the last 48 hours, or
  • are exempt from vaccination or vaccination and testing on the basis of a medical exemption or clinical trial participation

You should take tests as late as possible before attending the event, ideally within 12 hours. This will strengthen the protection testing provides.

The NHS COVID Pass lets you share your coronavirus (COVID-19) status records or test COVID-19 status in a secure way.

It allows you to show others the details of your COVID-19 status:

  • when travelling abroad to some countries or territories
  • as a condition of entry at those venues or events that use the service in England

You can get an NHS COVID Pass:

  • digitally through the NHS App or online via NHS.UK
  • as a letter sent to you in the post, for those who are not digitally enabled

You can find out the eligibility requirements on the NHS website.

If you live in England, you can use the NHS COVID Pass to prove your COVID-19 status. The NHS COVID Pass provides valid proof of your COVID-19 status based on your COVID-19 vaccination details, test results, medical exemption or clinical trial participation.

A valid text or email confirmation from NHS Test and Trace (see the Reporting test results section below) can also be used as proof that you have completed a negative PCR test or negative rapid lateral flow test within the past 48 hours.

The venue or event will check your COVID-19 status. If you do not meet the requirements, the responsible person is legally required to deny you entry to the venue or event.

Visiting England as a resident of Wales, Scotland, Northern Ireland, Jersey, Guernsey or the Isle of Man

If you live in Wales, Scotland, Northern Ireland, Jersey, Guernsey or the Isle of Man then you can show proof of your COVID-19 status as this will be recognised in England if you visit.

International visitors

If you were vaccinated in another country, you can show alternative proof of vaccination if this is accepted at the UK border. International visitors can also show a valid text or email confirmation of a negative rapid lateral flow or PCR test from NHS Test and Trace.

NHS COVID Pass for 12 to 15 year olds for international travel

Children in England who have had a full course of a COVID-19 vaccination are now eligible for an NHS COVID Pass letter for travel.

This will allow those children who have had both doses of an approved vaccine to travel to countries, including Spain and Canada, which now require 12 to 15 year olds to be fully vaccinated in order to gain entry, avoid isolation, or access venues or services.

Proof of vaccination will initially be provided via a letter service, including an internationally recognised 2D barcode, with a digital solution via NHS.UK to be rolled out early next year. The letter service can be accessed by calling 119 or via NHS.UK.

£1.02 million research funding awarded for robotic chemist project

Dstl (Defence Science and Technology Laboratory) is pioneering the use of autonomous mobile robotics within the scientific research laboratory.

To continue to deliver critical analytical capability for chemical, biological and explosives analysis, Dstl is working with industrial and academic partners to develop the application of mobile robotic platforms in laboratory (lab) environments. The majority of the £1,020,000 funding for this 2 year project is provided by the Defence Innovation Unit, with support from Defence Equipment and Support, and the Department for Transport.

Robots have been used in a range of industries for a number of years and fixed systems have even found some use within lab environments.

Click here for more details about the C19 resources and updates available to 2020 Members.