Judith Dugdale, director at Moore and Smalley Chartered Accountants and Business Advisors, discusses the importance to the region’s tourist economy.

After much anticipation of a boost to domestic travel caused by the recession, evidence is finally beginning to emerge that this WILL be the year of the Great British Summer for the region’s economy.

I am very encouraged to hear from some of our leisure and tourism clients that bookings are up on this time last year and the outlook for the summer is ‘excellent’.

At a recent roundtable discussion on tourism, hosted by Moore and Smalley in Kendal, we heard from Barney Cunliffe, director of Gilpin Lodge Country House Hotel, and Steve Ramsdale of The Swan Hotel, Newby Bridge.

Both informed the panel how room bookings for the summer months are strong and how revenue from non-resident dining in their bars and restaurants is up too. My colleague Michael Proudfoot also told how a client that rents out holiday cottages was seeing bookings up 15 per cent on the same period last year.

And the evidence isn’t just anecdotal. Ian Stephens, chief executive of Cumbria Tourism, revealed to guests at our discussions that 90 per cent of Cumbria businesses surveyed felt optimistic about the next six months.

This is very good news, but we must not rest on our laurels. We are now advising our clients to ensure they get their product offering right to give customers the very best experience and keep them coming back for more.

Like Phil Reddy, head of tourism strategy at the NWDA, said “It’s fundamental to the success of our destinations that a high priority is given to growth of the visitor economy because it’s a very key part of the Cumbrian economy.”

Moore and Smalley’s Rachel Marsdin looks ahead to what the budget may bring for businesses in Kendal.

THE eyes of the business community will be on Alistair Darling when he announces his budget on April 22. But my message to those hoping for words of comfort is don’t hold your breath.

Public debt is at record levels and tax revenues have fallen significantly, adding up to a huge hole in public finances. And this means we’ll see a very cautious budget with no surprises and certainly no tax giveaways.

In my opinion, the only effective measure that’s feasible for the Government is a significant extension of the Business Payment Support Service, which allows businesses meeting certain criteria to defer tax, National Insurance, VAT and other payments owed to HMRC without incurring surcharges.

The Chancellor has already said the scheme will remain in place for the foreseeable future, but I would like him to announce a definitive extension, maybe for two years, and also allow payments to be deferred interest free. At the moment interest still has to be paid on deferments and that doesn’t really help businesses with cash flow problems.

The suspension of the planned one per cent increase in Corporation Tax will be welcomed, but businesses should be prepared for an increase in National Insurance Contributions. There are already plans to increase these by 0.5 per cent from 2011, but there’s a good chance Mr Darling will decide to bring this increase forward.

Likewise, he may add to the recent increases in Capital Gains Tax and he probably imagines there will be little resistance to that given the current economic climate.

He may take the opportunity to revamp inheritance tax too. This is one of the few areas where the Chancellor may be able to raise taxes without damaging industry and that makes it more likely.

Generally speaking there is very little room for manoeuvre. The important thing as far as the Government is concerned is showing there’s a steady hand on the tiller. If they fail to do that then people are going to be more than a little worried.

By Stewart Case, director at Moore and Smalley Chartered Accountants and Business Advisors

‘Look after the pennies and the pounds will look after themselves’, ‘saving for a rainy day’ and ‘turnover is for vanity, profit is for sanity’ are phrases many Northern folk have been brought up on. I for one had such advice drilled into me from an early age.

It’s a shame such expressions are not used more often in the boardrooms of businesses because, as an advisor to hundreds of companies in the region, one of the things we have noticed is that companies that have lived by these philosophies are the ones that are surviving, and even thriving, during these troubled times.

Tellingly, this attitude has been more prevalent among SMEs and owner-managed businesses with realistic ambitions and a down-to-earth approach to doing business. These businesses have been better protected against the recession because, even during the boom times, they have not been reckless with cash or had irrational and egotistical expansion plans.

Instead they have grown steadily over a number of years, spending their money wisely, and ensuring their borrowings have not been too high. Many are now coping admirably.

The message we’ve had from these businesses is that they are fed-up of being tarred with the same brush that’s cast a black mark over irresponsible big business.

Of course, there’s always a need for businesses to take risks, the economy would never grow if it didn’t. But risks must be measured, manageable and mitigated.

Perhaps we would all be better off getting back to a more frugal ‘Northern’ attitude towards money. There must be thousands of businesses out there who would gladly turn back the clock to sacrifice short-term reward for long-term stability.

Of course hindsight is a wonderful thing but, to use another popular saying, let’s make sure that, as a society, we learn from our mistakes.

BY now most medium-sized businesses will be used to filing PAYE documents, such as their P35 Employer Annual Returns, online with HM Revenue & Customs (HMRC).

But it’s worth reminder that from April 6 HMRC is increasing the scope of documents that must be filed online to include employee starter and leaver documents, such as P45s and P46s, for businesses with over 50 employees.

Businesses with over 50 staff that are not registered to file these documents online after April 6 could face a potential penalty. The new rules relate to employee documents like P45s, P46s and P46(Pen) for pensions. Employers must first register to file these forms online by going to the HMRC website.

Once registered they can file the documents through HMRC’s PAYE service, commercial payroll software, or by Electronic Data Interchange (EDI) – a secure phoneline suitable for large numbers of forms. Alternatively employers can use a payroll provider.

At present the new rules don’t affect businesses with fewer than 50 employees, but the HMRC is planning to make online filing compulsory for all businesses, regardless of size, from April 2011.

Visit www.mooreandsmalley.co.uk for more information.

IT’S too early to tell for sure, but there may be better news heading our way on the employment front.

Moore and Smalley has seen evidence that the sharp number of job losses seen since late last year could be beginning to plateau.

Our payroll division, which oversees payroll provision for around 5,000 of our client’s employees in the region, has reported that staff changes among clients has been largely static since January, after redundancies hit a peak in December 2008.

I believe the trend could be a sign that the Lancaster jobs market is more resilient than other cities because it is not dependent on just one or two business sectors.

Lancaster has a diverse economy supported by agriculture, traditional and modern manufacturing, tourism and leisure, retail, and the services sector. This could be one of the main reasons why we are not seeing as many redundancies in the first three months of the year as many other areas of the country.

Let’s keep our fingers crossed and hope that the worst may be over when it comes to redundancies.

Stephen Adams is associate tax principal at Moore and Smalley chartered accountants and business advisors

‘Big Bang’ is the name being given to the revolutionary new HM Revenue and Customs powers and penalties regime for tax returns filed after 1/4/09, whereby new (almost double) fines will be based on ‘behaviour’ of taxpayers.

Errors will be classed by HMRC as either ‘careless’, and/or ‘deliberate’ and/or ‘concealed’, with increasing penalties for each offence.

The best way to avoid any fines is to ensure all tax decisions are correctly documented to show care is taken, and this applies especially to all employee tax and National Insurance Contribution matters.

If you have not had an employee tax or NIC compliance visit from a tax inspector for some time, now is a good time to ensure all is in order.

By Graham Gordon, partner and head of financial planning at Moore and Smalley chartered accountants and business advisors

I’m starting to wonder whether the Government would be just as well hiring a team of psychologists to lead us out of the grip of recession.

My reasoning is that those people walking around in ignorant bliss of the financial crisis (i.e. those not listening to Radio 4) are happier people. It got me thinking the Government could boost consumer optimism over night if they could somehow get inside our heads and convince us that everything is going to be hunky dory.

For example, it would be interesting to see how people would react if the Government came out and stated categorically that the financial crisis will be over on, let’s say, the 12^th May 2009. I’ve plucked this date out of the air, but my bet is we’d see confidence return to the housing market at once, consumers would begin to spend again and there’d be a halt to mass job losses. This would hopefully coincide with the warmer weather and with any luck we’d see the feel-good factor returning after 18-months of hell.

Of course this is all make believe, but the point I’m trying to make is that psychology is playing a big part in this recession. The media has been blamed for contributing to the collapse in confidence, but news channels are only reacting to what financial analysts and people in Government and are telling them.

What we need now is positive, responsible and realistic messages from those in positions of power. That’s not to say we should be encouraged to live in denial about the seriousness of this situation, or that we should throw caution to the wind and buy our way out of trouble. We simply need to be coaxed out of a damaging negative mindset.

If psychology has taught us anything it’s that when we are pessimistic, we close ourselves off. We become narrow-minded and we miss the opportunities that could solve our problems. On the other hand, when we are optimistic, we are on the front foot. We make our own luck and opportunities. The Government’s messages need to reflect this.