Accounting News – Autumn 2023

Navigating the Autumn Statement and Rising Interest Rates

The UK entered autumn 2023 facing persistent inflation, higher interest rates, and ongoing uncertainty about economic growth. The Chancellor’s Autumn Statement focused on stability and encouraging investment.

Key announcements

• Business rates support – Transitional relief was extended to help businesses manage rising property costs.
• Minimum wage increase – The National Living Wage was confirmed to rise to £11 per hour from April 2024, affecting payroll planning.
• Pensions triple lock maintained – The state pension rose in line with inflation, offering reassurance to retirees.
• R&D and investment zones – Funding announced for new regional “investment zones” aimed at driving innovation and jobs.

Impact of rising interest rates

The Bank of England raised rates repeatedly through 2023, reaching 5.25% by the autumn. This had major consequences for:

• Businesses with variable-rate loans or overdrafts, who saw costs rise sharply.
• Homeowners coming off fixed-rate mortgages, many facing significantly higher monthly payments.

What businesses should do

• Review borrowing costs and explore refinancing options.
• Strengthen cashflow forecasting with different interest rate scenarios.
• Consider government incentives such as full expensing to offset higher costs with tax relief.

📞 Need help navigating rising costs and policy changes? Contact us today for expert advice on cashflow management, tax planning, and growth strategies.