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For many businesses, short-term finance can provide an essential lifeline when cash flow becomes tight.

Whether a business needs support covering a gap between paying suppliers and receiving customer payments, or managing seasonal demand, the right type of finance can keep a business moving during uncertain times.

However, using short-term borrowing without a clear strategy can quickly become a slippery slope of missed payments and further injections of cash.

Choosing the right type of finance for your business

Not all types of short-term finance are designed for the same purpose, so businesses need to choose the option that best matches their needs.

An overdraft can provide a flexible cash buffer for day-to-day cash flow pressures, with interest usually charged only on the amount borrowed.

Invoice finance can help unlock cash tied up in unpaid business invoices, while a short-term loan may be more suitable for funding a specific purchase or project.

Problems can arise when businesses use one type of finance to solve an issue it was not intended to address.

A short-term cash flow gap can turn into a long-term borrowing habit, causing interest costs and fees to build up over time and reduce profitability.

How to avoid the interest trap

While short-term finance can be a valuable tool, it is important to understand the full cost of borrowing.

Some forms of finance, such as certain credit cards, bridging loans and revolving credit facilities, can have higher interest rates and shorter repayment terms.

Although these products can be useful in the right circumstances, they can place additional strain on businesses with unpredictable cash flow.

Understanding the total cost of borrowing can help avoid unnecessary expense and ensure the finance remains affordable.

Matching the right type of finance to the right business need can help businesses manage cash flow more effectively and avoid falling into an expensive cycle of debt.

How can we help?

Before you fall down the slippery slope of short-term finance, get in touch with an accountant.

We understand that short-term finance can sometimes feel like the only option.

Our team can help assess your cash flow needs, review your funding options and support you in choosing a solution that helps your business grow while keeping borrowing costs under control.

For support with short-term finance options, get in touch with our team.

The rate of inflation has hit 2.9 per cent in July 2026, up from 2.6 per cent in June, according to the latest data that has been published by the Office for National Statistics (ONS).

This is the first rise in the national rate of inflation since March 2026, with the increase in the energy price cap being partly to blame.

Businesses need to understand how this hike will affect them and what they must do to mitigate the issues.

How is inflation affecting businesses?

Higher inflation can increase the cost of running a business. Energy-intensive businesses and manufacturers are likely to feel the greatest impact, as rising energy prices can lead to higher production, transport and operating costs.

Many businesses are already dealing with tight profit margins and may find it difficult to absorb these additional costs.

Passing increased costs on to customers is not always straightforward, as consumers remain cautious about spending and may look for cheaper alternatives if prices rise too much.

Inflation can also affect employment costs. Employees may expect higher pay to help maintain their spending power, creating additional pressure on business finances.

With employment costs already rising, some organisations may take a more cautious approach to recruitment or delay planned investments.

What should businesses do to mitigate the impact of inflation?

With inflation remaining uncertain, businesses should review their budgets regularly and keep a close eye on cash flow.

Understanding where costs are rising most quickly can help businesses identify areas where savings or efficiencies can be made.

Businesses should also assess their pricing strategies to ensure they remain competitive while protecting profitability.

Investing in technology, improving efficiency and carefully managing expenditure may help reduce the impact of rising costs.

Strong financial planning and regular monitoring of business performance can help organisations remain resilient if inflation continues in the months ahead.

How can we help?

While the rate of inflation increasing to 2.9 per cent may not seem like a huge change, businesses must consider the impact that it will have on wider spending.

Our team can help you manage your cash flow by completing financial forecasting to ensure that your business stays resilient should inflation rates increase further.

For support with cash flow, get in touch with our team.

For many people, giving financial support to family members is an important part of their financial planning.

Whether it is helping children with pension contributions or providing ongoing assistance, gifting can play an important role in Inheritance Tax (IHT) planning.

The normal expenditure out of income exemption under Section 21 of the Inheritance Tax Act 1984 allows for gifts to be made without being chargeable for IHT purposes, if specific conditions are met.

What are the requirements?

Under Section 21, gifts can be exempt from IHT if they are part of a person’s normal spending habits, are paid from their income and leave them with enough income to maintain their usual standard of living.

This exemption only applies to gifts made from surplus net income, not from capital or savings.

For example, withdrawals from an investment bond or the capital part of a purchased life annuity payment would not qualify.

The donor must also be able to cover their normal living costs from their remaining income and cannot give away income and then use capital to make up any shortfall.

Why is record-keeping important?

As the exemption is usually claimed after death, it is important to keep clear records of any gifts made under the normal expenditure out of income rules.

HMRC form IHT403 includes a schedule that can be used to record these gifts as they are made and can help support a future claim.

To work out whether gifts need to be reported, the donor must add together any gifts made under this exemption and any chargeable lifetime transfers made during the previous seven years.

If the total is more than the available nil rate band, all gifts must be reported to HMRC using form IHT100.

HMRC will then review whether the exemption applies and confirm its decision in writing.

If the total remains within the nil rate band, the exemption is usually reviewed only after the donor’s death, when the executors can claim the exemption using forms IHT400 and IHT403.

How can we help?

Planning for IHT helps to safeguard your family’s future, as utilising vital allowances enables you to minimise your IHT contributions.

Our team of accountants can support you with gifting out of income so that you can provide for your family’s future.

Get in touch with our team for support with Inheritance Tax planning.

In June 2026, the Government published a document to gather views on the introduction of a criminal offence for making reckless or untrue statements relating to tax.

The Institute of Chartered Accountants in England and Wales (ICAEW) has warned that the proposal risks confusing taxpayers and discouraging voluntary disclosures.

Instead, the ICAEW has advised HMRC to make ‘better use of its current powers,’ before criminalising ‘reckless offences.’

Is the offence needed?

The Government has justified the offence as a way of providing consistency between indirect and direct offences, mirroring what is in place for indirect taxes.

For example, untrue statements relating to VAT and customs can be prosecuted, or where an individual has submitted incorrect documents knowingly and recklessly, without HMRC having to prove dishonesty.

No equivalent exists for direct taxes.

The Government argues the new offence would create an enforcement tool that could be used in direct tax cases where dishonesty is unable to be established, but a sanction is needed.

This would not only apply to taxpayers, but also agents who recklessly make a statement or declaration to HMRC on someone else’s behalf.

How does the ICAEW view the proposed change?

The ICAEW strongly opposes the introduction of the new offence. It noted that the equivalent offence for indirect tax offences is rarely used, which raises doubts over whether it is even effective.

ICAEW suggests the change should be scrapped, as it views HMRC as already possessing the powers it needs to handle non-compliance.

The larger worry is with the definition of ‘reckless’, with the ICAEW suggesting most taxpayers and advisers might struggle to understand how it could be applied.

As the current tax system already categorises behaviour into careless, deliberate and fraudulent, another definition might cause added confusion.

Where the line is hard to draw, compliance checks will be hard to enforce.

Speaking to an accountant

Reaching out to an accountant can help ensure that statements are evidenced when you file, alongside clear records of the decisions and checks made.

If a claim or treatment might be deemed as uncertain, seeking advice before it is submitted can help you flag potential issues before a compliance check arises.

Reach out to an accountant to make sure your tax claims are properly evidenced.

New funding rules for apprenticeships have been introduced, impacting any apprenticeships starting after 1 August 2026.

This could affect more employers than before as apprenticeships are becoming increasingly popular, with 308,770 starts between August 2025 and April 2026, up 8.7 per cent year-on-year.

With results season over and September intakes finalised, employers weighing up apprenticeships need to understand how these changes might impact them.

What are the new rules?

The rules for apprenticeship funding change most years, so it is essential to keep up to date and be aware of how apprenticeships will be affected.

The 2026/27 rules establish that:

• The minimum number of off-the-job hours training apprentices must complete is an absolute minimum of 187 hours – the actual minimum may vary based on the apprenticeship.
• Employers must keep the PAYE information in their Government apprenticeship service account accurate and up to date.
• Individualised learning records and planned end dates must not change when submitted – this applies even if the apprenticeship agreement is extended.
• Off-the-job training and active learning do not include English and maths as standalone qualifications, even if the apprentice requires it to do their work.

At the end of the apprenticeship programme, the employer, provider and learner must agree that the training plan has been effectively delivered.

How do funding changes affect the apprenticeship levy?

For employers that pay the apprenticeship levy, the changes might be an added financial burden.

The Government no longer makes a supplementary payment of 10 per cent and this is no longer added to new funds entering apprenticeship levy accounts.

Where an employer does not pay the levy and the apprentice is older than 25, the employer co-investment rate is 5 per cent.

However, if the levy payer was to have insufficient funds in their apprenticeship service account, the employer co-investment rate is 25 per cent.

For employers who do not pay the levy, they will benefit from the Government funding all the apprenticeship training and assessment costs, up to the maximum amount.
This applies to apprentices aged between 16 and 24 at the start of their training.

Speak to an accountant

Reaching out to an accountant can help you budget for the cost impact of the changes to apprenticeship funding, whether you pay or don’t pay the levy.

Accountants can integrate apprentice hiring into cash flow forecasting and recruitment planning, tracking start dates and ages so employers can access the funding and incentives available.

Reach out to our team for guidance on how the new apprenticeship funding rules might impact your business.

With temperatures breaking 30 degrees on multiple occasions in 2026, scorching heat is becoming the new normal.

Consecutive heatwaves have wiped £4.4 billion from the UK economy, according to research from think tank Verdant.

Heatwaves are predicted to become more common and more intense, likely costing UK employers further billions of pounds unless they are able to prepare.

Where do the losses come from?

After experiencing the fifth heatwave of the year, the Met Office reported that summer 2026 is on course to be the hottest on record.

Every one degree over 30 has been linked to a three per cent fall in average output per hour, according to analyst calculations.

The projected cumulative losses in productivity are expected to reach £25.6 billion by 2030 if trends in extreme heat continue.

While the losses primarily come from reduced worker productivity, extreme heat can cause infrastructure and equipment malfunctions.

Elsewhere, supply chains can be impacted through damage to roads and vehicles overheating.

How could SMEs prepare?

While there is no statutory maximum workplace temperature, there have been calls for the Government to compensate employees who are unable to work in the heat.

The pre-existing legislation, outlined in the Health and Safety at Work Act 1974, stipulates that workplace temperatures should not harm employee health.

However, as heatwaves become more regular, there is a chance a maximum workplace temperature will be introduced.

SMEs could begin to implement climate control in the workplace to prepare for future heatwaves, ensuring workers are comfortable during extreme heat.

Creating heat plans for your company can help identify hazards early, with pre-prepared policies to be rolled out when the weather is hot.

This might include a relaxed dress code, hydration breaks, flexible working hours and homeworking triggers that are agreed in advance.

Where productivity is expected to dip, financial modelling can allow you to see what a few weeks of reduced output might mean for your company – the same approach taken to seasonal dips.

Speaking to a specialist

Accountants can build heat disruption into cash flow models to enable you to mitigate the impact of lower productivity on your revenue.

A specialist can check whether businesses might be eligible for capital allowances to invest in cooling and ventilation equipment, providing added funding or tax reliefs.

Contact our team for advice on how to protect your business from the next heatwave.