SMEs using loans to pay suppliers –  business news  20 July 2020.

20 July 2020.

James Salmon, Operations Director.

We look at SMEs using loans to pay suppliers, the uneven economic recovery, SME confidence, Britain’s economic prospects, the return to the office, the effect on commercial property, debt repayments, Covid-19 news, tax and a lot more.

Here are CPA we want to  share the business news stories we have seen that we think will affect our members and readers. Many of us are busy fighting to protect our businesses and therefore might have missed some of the news that could impact small businesses, their owners and those that sell on credit.

SMEs using coronavirus loans to pay suppliers

Barclays research shows that half of small businesses who have taken support loans amid the coronavirus pandemic are using the emergency funding to pay their suppliers. The study also revealed that 35% have used some of the money to pay rent on their premises, while a third spent part of their loans topping up the wages of furloughed staff. On future intentions, 26% of SMEs plan to increase spending on product development, with 15% looking to increase their investment in automation to boost their productivity. Hannah Bernard, head of business banking at Barclays, said: “SMEs are thinking about how to boost their profits through investment in technology and marketing.”

Bailey: Uneven economic recovery has started

Bank of England governor Andrew Bailey says that while the UK economy is starting to recover from the coronavirus lockdown, the rebound seen so far has been uneven. Mr Bailey said that activity in the housing and car markets is resuming “quite strongly” but the hospitality and entertainment sectors, which employ large numbers of people, many of whom are on low pay, are struggling. Speaking during a webinar yesterday, he said a “very big question” remains over whether people would return to their pre-pandemic habits and spending patterns. When asked if the UK economy would see a V-shaped recovery, he said: “We don’t yet know the full story of this.” He also said the impact company failures could have on the economy is unclear.

SMEs confidence grows

A small business confidence survey by Hitachi Capital Business Finance shows that the proportion of UK-based firms expecting growth in the next three months has risen from 14% in April to 27% in July. The proportion of firms who foresee contraction or collapse in the next quarter has dipped from 31% to 19%. Gavin Wraith-Carter, managing director at Hitachi Capital Business Finance, said: “It shows what an immediate and positive impact the easing of lockdown has had on the small business community.”

Britain’s economic prospects ahead of G7 average

Analysis by the Organisation for Economic Co-operation and Development (OECD) suggests Britain’s economic prospects for the rest of this year and into 2021 are stronger than the average for the G7.

The OECD’s forward looking index has rated the UK at 97.4, while the average across the G7 advanced economies is 96.7. The index looks at six areas: a consumer confidence index, confidence indices for manufacturing and services businesses, share prices, short-term interest rates and new car registrations. These elements are deemed to be future facing, whereas figures relating to growth, employment, inflation and retail sales are focused on past activity.

Meanwhile, the IHS Markit/CIPS Purchasing Managers’ Index for July could bring fresh optimism this week, with Howard Archer, chief economic adviser to the EY Item Club, saying the figures “may show a bit of an improvement”. While the index saw services dragging down the economy in June, Mr Archer said: “I hope the lifting of restrictions on July 4 will have allowed the service sector to pick up.”

Small firms look to recovery after pandemic hit

The Sunday Times looked at how small firms are preparing to bounce back after the disruption and challenges brought about by the COVID-19 crisis. It says SMEs “have felt the most immediate pain ” from the crisis, citing figures from the ACCA and Corporate Finance Network showing that at the start of May, just 42% of SMEs had enough cash to last four weeks.

The report details the support measures that the Government rolled out to help small firms through the pandemic and says recovery is now the main focus for business leaders and politicians. On mooted measures that could drive this, it notes that lobby group TheCityUK has suggested that the Government takes minority stakes in small companies, while the Business Growth Fund has suggested the launch of a £15bn equity fund.

Federation of Small Businesses chief of external affairs Craig Beaumont, who says there has been “extraordinary support” from the Government, comments: “Now we need to switch to the recovery, including extending some of the schemes.”

CFOs expect slow business recovery

A poll from Deloitte shows that CFOs do not expect businesses to see a quick bounce back from the coronavirus crisis, with many saying demand is unlikely to recover until the second half of 2021.

The survey saw 49% of finance bosses say they do not expect demand at their firm to return to pre-pandemic levels until after Q2 2021, while 78% expect revenue at UK firms to dip over the next 12 months – down on the 97% who said the same in a Q1 poll.

Some 80% of CFOs said there is a high or very high level of uncertainty facing their business, while 65% said they have been forced to reduce capital spending. Respondents ranked the effects of the pandemic as the greatest risk facing their business, followed by geopolitics, Brexit and economic weakness in the US.

Deloitte chief executive Ian Stewart said major corporates are expecting “a long haul back” to pre-pandemic levels of revenue

Scotland sees disparity in SME closures

A study by the Association of Chartered Certified Accountants shows that 13% of SMEs have gone into liquidation in Scotland amid the coronavirus crisis, compared to 5.4% across the whole of the UK. Craig Vickery, head of ACCA Scotland, said cashflow concerns and uncertainty about when the economy would open up explained the disparity, saying: “The concerns over cash in particular has led to many SMEs deciding it would be easier to just close”. He added that Scotland seeing a slightly slower release from lockdown than England and having a heavier reliance on tourism and hospitality “have been factors in the results.”

Firms in no rush for office return

Fewer than one in six workers has returned to the office, with a number of Britain’s biggest employers saying they will continue to allow staff to work from home for months to come.

EY, which employs 17,000 people in the UK, will re-open its offices from September 7 but capacity will be “significantly reduced” and employees will return on a voluntary basis with a desk booking system. Elsewhere, PwC is set to increase its office presence from 15% to more than 50% by September. PwC UK’s chair Kevin Ellis has said: “Office life can be balanced with working from home.”

Pandemic pushes changes to working life forward

Writing in the Scotsman, KPMG’s James Kergon suggests that the COVID-19 crisis has “accelerated” disruption and change to traditional working practices. He says the crisis has given employers “a new perspective”, saying business leaders are already “examining how jobs are realigned to skills and task, rather than traditional job roles, and recognise how skills will be fluid and change to meet new roles that emerge or respond quickly to crisis.”

Recruitment shifts to the kitchen table under new normal

Analysis by PwC shows that 26% of CFOs are concerned that remote working may result in reduced productivity, down from 63% at the start of the COVID-19

Shift in business priorities

Research by BDO shows that business leaders’ priorities have changed in the wake of the COVID-19 outbreak, with reducing overheads and business costs the main focus, where six months ago the emphasis was on attracting and retaining high quality talent.

More than nine in ten (92%) of respondents said reducing overheads would be important for their firm’s survival and success.

BDO managing director Paul Eagland comments: “Unsurprisingly, some businesses have reined in their growth ambitions in order to focus on business resilience.” He added: “As we emerge more fully from lockdown, business leaders will need to continue to act with agility and creativity to ensure their businesses are in the best shape to take advantage of the recovery.”

Self-employed hit by pandemic

Holly Thomas in the Times on Saturday considered the climate for the self-employed, saying that with around 5 million people, it is the nation’s fastest- growing workforce. While there are many benefits to setting up on your own, including tax perks, the financial impact of the coronavirus crisis on freelancers and small businesses has been substantial. On support rolled out by ministers, Richard Churchill at Blick Rothenberg says: “The Self-Employment Income Support Scheme would have been better serving had it been a tapered support rather than cutting off at £50,000, and for small business directors paid primarily through dividends a similar scheme should have been implemented”.

A fifth of SMEs eye smaller offices

Research by Santander shows that a number of SMEs are planning to downsize their offices and encourage staff to work from home in the wake of the COVID-19 pandemic, with 20% looking to occupy less space and 29% set to encourage remote working.

The study, which surveyed 2,050 firms , saw 81% say they are concerned that their business will not recover from the impact of the crisis until 2021 at the earliest. Susan Davies, Santander’s business banking boss, said many SMEs have had to adapt “almost overnight” to survive.

£230bn hit for commercial property

The Office for Budget Responsibility (OBR) predicts that the value of commercial buildings will fall by nearly 14% this year, with this representing a £230bn decline in value. It is predicting prices will fall by 13.8% in 2020/21, recovering slowly to rise by 0.9% in 2021/22, 2.6% in 2022/23, 1.5% in 2023/24 and 2% in 2024/25. Transactions are expected to slip by 23.7% in 2020/21

MPs demand crackdown on levy avoidance advisers

A cross-party committee of MPs has called for a change in law that would make it easier to prosecute tax lawyers, accountants and advisers who promote unlawful tax avoidance schemes.

Dividends down 57% in Q2

Analysis by Link Group shows that dividend payments fell by a record 57% in Q2 as the coronavirus crisis prompted an unprecedented cut. Dividend payments fell to £16.1bn in the three months to the end of June, meaning investors missed out on £22bn. The second quarter saw 30 firms reducing their payout while 176 paid no dividends at all, with just 61 businesses increasing their dividend payout. Link Group predicts total dividend payouts for 2020 could fall to £56.7bn in the ‘worst-case scenario’, down from £110.5bn last year, while a best-case scenario would see £61.6bn handed out. It estimates that it could be 2026 before dividends return to their 2019 level, saying a lot of companies need to reset payouts to a “lower, more sustainable level from which they can again start to rebuild”.

Profit warnings close to record

Research from EY shows that London-listed firms are close to breaking the annual record for the number of profit warnings issued, with much of the surge attributed to the coronavirus crisis. The study shows 466 profit warnings were issued by UK-quoted companies during the first half of the year, with this nearing the 506 record seen in 2001. The pandemic saw a quarterly record of 301 warnings during Q1. Of the 165 in Q2, almost two-thirds came from companies that had not downgraded their profit expectations during the past 12 months. Alan Hudson of EY said that “the most immediate and dramatic impact” of COVID-19 has been felt by companies whose existing structural challenges have been exacerbated by the pandemic, but added that “many businesses that were sound before the virus, have also been forced to fundamentally reassess their expectations and business plans.”

Greece uses tax to tempt pensioners

Greece is looking to tempt pensioners to move to the country with a flat rate of income tax at 7% for retired foreigners who transfer their tax residence. Discussing the beneficial tax rate for foreign pensioners, an incentive that would apply for ten years, Athina Kalyva, head of tax policy at the country’s finance ministry, said: “The logic is very simple: we want pensioners to relocate here.”

Majority of homeowners restart payments

The majority of homeowners who took mortgage holidays due to the economic challenges brought about by the coronavirus outbreak have resumed making repayments. Analysis shows that just a fifth of those who took a three month mortgage holiday asked for an extension when banks offered a second quarter-year payment break in May. NatWest and Royal Bank of Scotland said 16% of borrowers who originally requested a mortgage break had asked for it to be extended, while at Nationwide 20% have asked for a second payment holiday. Figures from UK Finance show that 1.9m homeowners had asked for a mortgage holiday at the peak of the initiative, a total equivalent to one in every six UK mortgages

More pubs and restaurants set to open

Tim Wallace in the Telegraph on Saturday explored whether people are opting to return to pubs and restaurants as coronavirus lockdown measures ease. Will Hawley of KPMG says that while around only 45% of venues opened on the first weekend of the lockdown being lifted, 60% to 65% are expected to have opened this weekend.

Firms unprepared for no-deal Brexit, says think-tank

The Institute for Government has warned that the coronavirus crisis has left many UK businesses in a worse position to cope with a no-deal Brexit. A report from the think-tank says that government and business resources “have been focused on responding to the pandemic, rightly prioritising this over Brexit preparations”. It added that firms “reeling from the economic consequences of coronavirus are poorly placed to prepare for Brexit”. The report notes that three in five firms have not begun to prepare for the end of the transition period on December 31 due to ongoing uncertainty about the future relationship with the EU. “The UK will be adapting to the effects of Brexit for many years to come – which both business and government should be prepared for”, the report adds.

Banks urge leniency over coronavirus debts

Banks have urged ministers to take a lenient approach to recovering debts linked to coronavirus support loans. Lenders have suggested the Government should resist chasing small business owners through the courts where possible, while also proposing that customers in default should be contacted on two or three occasions before the loan is written off and taxpayers are left to foot the bill.

Banks are said to be assessing the support measures they could put in place before chasing businesses for loan repayments, while the Treasury is considering a proposal put forward by TheCityUK which suggests businesses could repay coronavirus support loans as a tax on their profits.

Banks reject borrowers who took payment breaks

Banks are turning away some mortgage applicants who took repayment holidays amid the coronavirus crisis, despite ministers and credit agencies saying pausing repayments would not impact their ability to borrow, reports the Mail on Sunday’s Helen Cahill.

In March, Business Secretary Alok Sharma said banks had negotiated rules around payment breaks with the Financial Conduct Authority, saying they would not affect a customer’s credit score, while Jonathan Westley, chief data officer at Experian, said the credit agency – as well as TransUnion and Equifax – would make sure payment holidays or other arrangements would be reflected in credit reports so payment freezes would not hit credit scores.

MP Siobhain McDonagh, who sits on the Treasury Select Committee, said she intends to write to Chancellor over the matter.

Recession to hit those in ‘left behind’ areas hardest

The Social Mobility Foundation says young people in social mobility “coldspots” identified by the Government’s Social Mobility Commission will be hardest hit by a recession brought about by the coronavirus pandemic due to their employment opportunities.

The study found that young people in England’s 10 local authorities with the lowest social mobility are 32% more likely to be claiming out-of-work benefits than those in the 10 highest ranked. The North East and North West are the hardest hit regions, with more than 10% of young people claiming such benefits.

The analysis highlights that a young person in Blackpool, the area with the highest rate of claimants, is seven times more likely to be in receipt of benefits than those in the area with the smallest proportion, Cambridge. Alan Milburn, the former Work and Pensions Secretary who chairs the Social Mobility Foundation, said: “Avoiding a jobs catastrophe for this generation of young people … requires urgent action by employers and government.”

Covid-19 general news

PM Boris Johnson has said that from 1st August public transport will be open for journeys, while advice for employers will change giving more discretion to bring people back to work, if safe to do so. Mr Johnson added he was “hoping for the best and planning for the worst”. The PM seemed to be encouraging people to get back to the office.

The Prime Minister also said social distancing could be scrapped as early as November, as the government tries to move the country back to “significant normality” before the Christmas period. Johnson also said that crowds could be able to return to sports stadiums in October in a major boost to the industry.

Several countries set grim records in the covid pandemic last week. The US registered at least 77,000 new cases, its highest single-day reporting to date. The country now has more than 3.5 million confirmed infections, more than any other. Brazil follows, with 2 million; passing that mark on Thursday. While India surpassed 1m infections on Friday. The global covid-19 death toll also passed 600,000. On Saturday the World Health Organisation announced that nearly 260,000 new cases had been recorded worldwide in the previous 24 hours, surpassing previous records

The Spanish region of Catalonia tightened social-distancing rules in Barcelona and the surrounding area, after an increase in new infections.

Negotiations over the European Union’s virus recovery fund made a breakthrough this morning after days in dead-lock, as leaders of the so-called Frugal Four countries signaled they would be ready to accept a compromise. The dispute centered on how the plan’s 750 billion euros ($856 billion) would be divided between grants and loans, with leaders of the Netherlands, Austria, Denmark and Sweden objecting to the initial proposal of 500 billion euros in grants. The four nations’ leaders are now ready to accept 390 billion euros in grants, according to unnamed officials, with talks still ongoing on other elements of the package.

PAC says Government unsure on tax relief value

The Public Accounts Committee (PAC) has warned that ministers do not know enough about tax reliefs, saying there is a lack of certainty over whether certain tax breaks work and provide value for money – as well as how much they cost. A report from the committee suggests the ten most expensive tax reliefs cost the public purse £117bn a year but “scant” evaluation by the Government shows that just one of the four tax breaks costing more than £1bn annually has the intended effect on economic behaviour.

Meg Hillier, chairwoman of the committee, said: “Tax breaks are not freebies – they cost the public purse hundreds of billions of pounds in lost income. The Government must know who they benefit and to what end. It’s all still taxpayers’ money and government must account for it.”

A Government spokesman insisted that HMRC “will provide information and extensive evaluation of the cost of tax reliefs to ensure they continue to work effectively.” They added that the tax office and Treasury “are constantly working to improve the transparency of reliefs and the National Audit Office has recognised the improvements in increasing oversight.”

Stride: Deficit puts tax vow under pressure

Treasury Committee chairman Mel Stride says a Conservative manifesto pledge to not raise income tax, national insurance or VAT could come under pressure as the country seeks to cover the cost of COVID-19, saying “pressures on tax will be potentially very considerable”, with the public appetite for broad spending cuts to reduce borrowing “limited”. Mr Stride believes tax “is going to be very central to the whole issue of fiscal consolidation and how we deal with the deficit.” Looking at the three taxes the Prime Minister has pledged will not rise, Mr Stride said they can “raise significant amounts of money”, telling the Telegraph: “They are three of the biggest ones you would turn to so it may be that there are going to be some very, very hard decisions around tax.” It is noted that the committee last week launched an inquiry into the tax system in the wake of the coronavirus.

Chancellor to turn to tax to drive recovery?

With Carys Roberts, director of the Institute for Public Policy Research think-tank, saying the Chancellor’s summer statement “fell a long way short of what was required” in regard to boosting the economy, with numerous issues that he still needs to address. Among these are tax increases, with the Office for Budget Responsibility (OBR) analysis showing that Government borrowing is set to rise to £322bn this year. The OBR estimates that this will require an additional £64bn a year from tax rises or a return to austerity. Mr Sunak has warned that “tough choices” will have to be made in the autumn budget, while some analysts have suggested a review of capital gains tax launched by the Treasury could see tax rises designed to help cover the costs of the economic recovery.

MPs to examine tax system

The Treasury Select Committee is conducting an inquiry into tax and will evaluate whether an overhaul of the tax system is required as the country looks to boost public finances in the aftermath of the COVID-19 pandemic. The committee will consider whether tax breaks can help the economy, long term pressures on the tax system and the level of taxation the economy can withstand. Committee chair Mel Stride, who said the pandemic has put the economy “under extraordinary stress”, suggested tax will “play a major role in the years ahead in restoring the public finances”. He also warned that the worst of the economic fallout of COVID-19 is “perhaps yet to come”. Glyn Fullelove, president of the Chartered Institute of Taxation, commented: “Whatever policies are adopted to meet the challenges ahead, being able to predict what the UK tax system will deliver under any given set of measures is vital for the Chancellor.”

Tax system can help reduce the deficit

Roger Bootle, chairman of Capital Economics, looks at the measures that may be required to rebalance public finances that have been hit by the coronavirus. This comes after the Office for Budget Responsibility warned that the ratio of Government debt to GDP could exceed 400% by 2070 and said increased tax revenues and / or reduced spending are likely to be required. Mr Bootle says increasing tax revenue is “potentially dangerous”, arguing that there is little use in raising tax revenue in the short-term if doing so reduces long-term growth potential, adding that maximising growth “requires a tax system that is structured to strengthen incentives and boost efficiency”.

Tax rises ‘would be disastrous’

Michael Jacobs, a professorial fellow at the Sheffield Political Economy Research Institute, considers whether taxes need to rise or spending should be cut to pay the COVID-19 bill, saying that while ministers have been quick to deny a return to austerity is in the works, the Government has “been noticeably more reticent on tax rises.” Mr Jacobs considers an Office for Budget Responsibility report saying that in “almost any conceivable world”, a tax increase or spending cut will at some point be needed to boost public finances, arguing that in the medium to long term, taxes do need to rise, but in the short term, increases “would be disastrous” and withdraw demand from the economy just when it needs stimulating.

HMRC targets multinationals for £20bn taxes

Fitzgerald & Law research shows concern over profits moved to low-tax jurisdictions saw HMRC challenge UK multinationals over liabilities totalling £20bn in 2019, up from £12.7bn in 2015.

Think-tank calls for end of CGT

The Institute of Economic Affairs (IEA) believes capital gains tax should be abolished. Speaking after Chancellor Rishi Sunak commissioned a review of levies on investment and property profits, the IEA’s Philip Booth suggested the duty should be scrapped. With some commenters suggesting the review will deliver an increase in the rate of the tax, Mr Booth said: “Capital gains tax is a complicated and damaging tax. Far from leading to it increasing, this review should lead to it being abolished.” The Institute for Fiscal Studies has proposed reforms to CGT including increasing rates in line with income tax at 20%, 40% or 45%. Nimesh Shah of Blick Rothenberg believes there is a case for scrapping CGT and inheritance tax as they account for less than 1% of the Treasury’s tax revenue but create significant administrative costs for HMRC.

Opinion: CGT review long overdue

With the Chancellor calling on the Office of Tax Simplification to look at capital gains tax, Lauren Davidson in the Telegraph on Saturday said such a move is “long overdue.” She says that CGT, “like other levies in desperate need of simplification”, such as stamp duty and inheritance tax – is “poorly designed and far too complicated.” Ms Davidson argues that if Rishi Sunak wants to simplify the tax system and stimulate the economy, scrapping CGT altogether may be the way to go. David Byers in the Times considers changes to CGT that the review may deliver, noting that Nimesh Shah of Blick Rothenberg and George Bull at RSM have suggested there is a case for low bandings to be aligned with income tax. Merryn Somerset Webb in the FT on Saturday also considered the options for reform of CGT, which she describes as stealth wealth tax. Emma Agyemang in the same paper mused on the review, taking comment from Katharine Arthur of haysmacintyre, Tim Stovold at Moore Kingston Smith and Saffery Champness’ Zena Hanks.

Small firms owed stamp duty refunds over transfers

Cornerstone Tax says a number of small firms that have transferred property into their pensions are owed stamp duty refunds. It says mistakes on the part of solicitors and pension advisers as far back as 2007 had led to small firms needlessly paying more than £1bn in tax on property transactions.

Nearly a third of buyers won’t feel stamp duty cut

Just over 10% of homebuyers will gain the maximum benefit – a saving of 2.5% or more on the purchase price – as a result of the stamp duty changes brought in on July 8. This maximum benefit goes to those purchasing properties priced between £400,000 and £600,000. Overall, 29% of buyers won’t get any benefit from the cut, because they are either buying properties for less than £125,000, or have already benefited from the first-time buyer relief on homes costing less than £300,000. The average stamp duty saving varies across the country, from 1.75% in London to less than 0.45% in the North East.

Auditor flags concern over Pockit

Auditors have highlighted “material uncertainty” over Pockit’s status as a going concern, with Grant Thornton saying there is “significant doubt” over the financial services provider’s ability to remain in business. In annual accounts filed more than nine months late, Grant Thornton said that liabilities exceed assets by £653,285.

Administrators open Gate probe

Administrators of failed theatre business Gate Ventures are investigating discrepancies in creditor claims. Insolvency practitioners are looking at inconsistencies in the financial position Gate presented in High Court proceedings compared with claims later filed by creditors. Insolvency practitioners from Quantuma are investigating claims by Gate’s directors, while an administrator from Moore Kingston Smith is examining counterclaims.

Ask and Zizzi sold out of administration

Azzurri Group, owner of the Zizzi and Ask Italian restaurant chains, has been sold out of administration to TowerBrook Capital Partners. The move will see around 225 restaurants and shops continue to operate, protecting about 5,000 jobs. However, the 75 sites not included in the deal are set to close, with 1,200 roles set to go.

Grant Thornton faces court over Patisserie Valerie

Liquidators to collapsed café chain Patisserie Valerie are preparing to take legal action against auditor Grant Thornton. FRP Advisory commissioned Smith & Williamson to investigate Grant Thornton’s work at the cake chain, which went into administration in 2019 after the discovery of a £40m hole in its accounts. The report is said to have identified significant failings in Grant Thornton’s auditing of Patisserie Valerie, prompting FRP Advisory to hire law firm Mishcon de Reya to explore a court claim against the auditor. The Sunday Times’ Oliver Shah says a lawsuit has been expected since FRP replaced KPMG in winding up Patisserie Valerie due to a conflict of interest stemming from the fact Grant Thornton audits KPMG’s accounts. Mr Shah notes that the Financial Reporting Council is investigating Grant Thornton ov er the issues at Patisserie Valerie.

Go Outdoors creditors may see a penny per pound

Deloitte has said unsecured creditors of Go Outdoors could recoup just 1p in every £1 owed. JD Sports, which bought the chain in a pre-pack administration, says it will pay HMRC, branded stock suppliers, customers’ returns and gift cards, with others – including landlords – set to be left out of pocket.

Don’t let Covid-19 bust your business!

It will if your cash flow dries up, either sooner or later.

The Credit Protection Association (CPA) has been assisting thousands of UK businesses to get paid since 1914. We have seen many financial crises, this one will be particularly deadly for suppliers for sometime to come.

CPA eases cash from tardy debtors – Efficiently, Effectively, Economically and Ethically. Above all tactfully, because maintenance of goodwill is paramount.

To meet the needs of creditors in the current crisis, we have designed a “critical care” package especially tailored for the situation.

  • The annual package costs start at very low rates
  • A minimum performance warranty is provided
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Clients instruct CPA on-line via their PC or phone, completely user-friendly. Your late paying customers are told to pay you direct (not to us).

A very recent report shows a 23% increase in the number of unpaid invoices since March 11th THIS YEAR – are you getting a build-up of late payers?

 Right now, overdue accounts must be a concern and CPA has a great track record of encouraging slow-payers to pay their suppliers quickly.

It takes less than 17 minutes to see how you would benefit, do you have the time now?

No face-to-face meeting required – just call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or email today.

When you see your money come in, you will be so glad you used CPA.

Do you sell on credit?

With pressures on the cash flow it is essential that you stay on top of the credit limits you grant customers and watch carefully for any late payments.

Those customers will look for the easiest option  to boost their cash-flow. Don’t let it be you.

You can’t just assume your customers can and will pay you eventually, no matter how big their name is.

It is essential to have credit management systems in place to monitor and check your customers credit worthiness.

It is also best practice to use a trusted third party like CPA to make sure you are paid on time by customers, no matter how good a name they have.

About CPA

The Credit Protection Association can help!

Formed in 1914, CPA has been providing credit management services to SMEs for over 100 years.

At the Credit Protection Association, we provide first class credit information that can help you avoid being over extended to customers who are at risk. Our monitoring service can flag up warning signs long before the end, giving you the chance to adjust and reduce your exposure. We provide recommended credit limits and credit scores on a traffic light system and can help you set appropriate credit policies for your customers.

We regularly publish lists of the latest insolvencies but by then it is too late. Our credit reports however predict approximately 96% of company insolvencies long before they arrive.

Companies in trouble usually have very bad cash flow and they try to deal with it by delaying payment to their suppliers, increasing your exposure to them.

If you supply on credit, help us help you identify the risks.

Why use a third party collector?

As a third party collector, we can also get your payments prioritised over those who are not as hot on collections. When your customer receives a letter from the Credit Protection Association regarding their outstanding account, they are going to want to get that resolved as a priority. Our overdue account recovery service can get your unpaid invoices to the top of their “to do” list and get your invoice paid.

Over the years we have collected billions in overdue invoices for our customers.

Our debt recovery and credit management services give our members the financial freedom needed to grow and prosper, while our new Late Payment Compensation department could unlock hidden potential and offer the compensation needed to springboard your business to success.

You might be hesitant about contacting a debt collection agency. What are they going to be like?

Can they help your particular type of business?

There is no need for concern. CPA are courteous, helpful and very probably have had direct experience of working with your type of business.

Debt collection agencies are not all alike.

Success lies in both recovering money and keeping customers happy. The Credit Protection Association was founded in 1914 and  has helped tens of thousands of UK businesses to collect outstanding payments and reduce the risk of incurring bad debt. We believe that creditors deserve to be paid for the work or goods they have supplied but we fully understand the need to maintain
the best possible relationship with customers!

At The Credit Protection Association, we provide solutions, advice and back-up in all areas relating to the supply of services or goods on account. Client-members receive everything they need from a single source to reduce debtor days and write-offs.

The Credit Protection Association has helped has assisted tens of thousands of UK businesses with their credit control requirements, since the First World War.

We are polite, firm and efficient when it comes to recovering outstanding debt.

“We have used CPA for a number of years now. The website is easy to navigate around with lots of helpful reports. The staff are always at hand and very friendly. CPA has  helped us reduce our debt over the years and keep track of potential issues with our customers.”
~ CPA client in Buckinghamshire

“The service from CPA has proved to be everything that you said it would be. We have already seen a huge benefit. We have had a number of overdue accounts paid promptly and directly to us. It is also a huge weight off our mind to know that once we have passed an overdue payment over to you, you take care of everything whilst keeping us informed.
~ Credit Controller client in Warrington

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections


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CPA is passionate about late payment

The Credit Protection Association has been protecting smaller firms against poor payment practices for over 100 years.

We are extremely passionate about breaking the late payment culture that holds back the UK economy and threatens many SMEs with cash flow difficulties being the single biggest killer of Britain’s small businesses.

If you were regularly paid late we can help. Those former customers used you to boost their own cashflow, regularly paying you late.

As a result you had extra costs, you had the distraction of having to chase payment, you had opportunity costs because your capital was tied up in their late invoices.

Under little used legislation, you are entitled to compensation for those late payments.

Now you can boost your own cash-flow.

CPA can help unearth the those hidden treasures.

We have the technology to reveal the compensation you are due and we have the extensive experience and expertise to then turn those claims into cash.

Yes, CPA can help you boost your business cash-flow.

Don’t let your bankers control you, contact CPA today.

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections

Read our blog here on how to crack down on the late payment culture.

Read our blog here on how to give late payers the slap they need.

The “Why” of the late payment culture.

New PM should walk the walk and back small firms over late payments

Paying late is “crack cocaine” to big business.

Late payment culture risks “spiraling out of control”

visit our late payment compensation page

See our full blog and FAQ on late payment compensation

Do you realise you could be sitting on a fortune?

Late payments often result in a cash flow crunch and leave SMEs in need of a cash injection.

If you sold B2B on credit then there may be a hidden source of capital you can call on.

If you fancy an bit of extra cash in your business, rather than jumping through hoops with your bank, you could look to uncover the resources from an unexpected source within your own business.

Not many are aware but there could be a hidden fortune within your business, sitting there, just waiting to be uncovered and released.

We can help you uncover the pile of gold, you didn’t even know you were sitting on.

If you trade with other businesses and were often paid late then you could be entitled to significant compensation.

Under little known and under-utilised legislation your business could be due huge amounts in compensation that you didn’t even know about.

Let’s be clear – this is not a way to weaken any customer relationships you value. It is one that identifies who’s been paying late and then recover the potentially significant sums in compensation using Late Payment Legislation from businesses where the relationship has already ended.

You can pick and choose who you want us to follow up – but once we’ve agreed which companies you’d like to pursue compensation from it’s a fast process and there’s no financial outlay to you whatsoever. My team at CPA put its expertise to work to recover the compensation due and fight late payment culture.

That compensation could provide the cash boost your business needed.

But don’t delay, that compensation evaporates if not claimed within six years of the late payment.

How can CPA help?

CPA has developed a unique technology to dig into your accounting records and discover the cash injection you are due by means of compensation. The software does all the hard work. Our software interacts over the cloud with over 300 different software packages, working directly with your accounts package, just so long as it’s stored on a computer.

We recognise that most companies do not have the resources to spend time on the identification and calculation of Late Payment Compensation. Our service can produce an Analyses within just a few days with (usually) less than 30 mins of co-operation from our clients. We work directly with over 300 accounting packages but can also work with bespoke accounts packages. Indeed, speed is essential as the oldest invoices may fall foul of the 6-year time limit.

Once the Sales Ledger Analyses is made available to clients, all that is required is that management decide which commercially sensitive ex-customers to remove from the list and return it to us.

CPA then uses its years of collection experience to explain and recover the Late Payment Compensation Claims. Clients do not handle any part of the recovery process as our team will take all communications from the companies against who the claims has been made. Often, it’s simply a case of explaining the legislation, sometimes we have to go all the way and enforce the legislation through the courts.

The result is that we are realising clients’ claims worth tens and sometimes hundreds of thousands of pounds which, of course, is pure net profit.  You may also be among the recipients of “hundreds of thousands of pounds” should you elect to take advantage of our services.

We do the work, you receive the cash.

If you have supplied goods and services to businesses on credit and were regularly paid late then you could be due significant sums in late payment compensation.

We are talking to companies and unearthing claims in the hundreds of thousands from former business customers who paid them late. Large business customers who abused their power to inflict unfair and sometimes illegal payment practices.

We are helping business owners  who are looking to boost the returns from their business before they retire. We are helping businesses who have lost major clients after years of loyal service to get properly compensated for systematic late payment. We are helping companies that were looking to close down, who looked insolvent and finding that cash injection they need to avoid insolvency.

Those former clients who regularly paid you late can finally be made to pay.

Ready to speak to an advisor?

For help or advice on credit management, entirely without obligation.

Call us today

0330 053 9263

The Credit Protection Association is a credit management company established in 1914. If you supply goods or services on credit then we can help you!

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections

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The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections