Care News SPRING 2022
Welcome Welcome to our Spring 2022 Newsletter! The year began much as 2021 ended, with the country still consumed by the pandemic and its knock-on effects. Nowhere have these effects been felt more keenly than in the care sector, where increased costs combined with the Government’s policy on compulsory vaccinations for care staff (revoked from 15th March), have presented significant challenges. But with a new tax year comes new beginnings. This is the time of year when we begin to see green shoots in our gardens (despite the best efforts of Storms Dudley, Eunice and Franklin!) and, reading Chandler & Co’s sector outlook within this newsletter, there are many reasons to look to 2022/23 with renewed optimism. This edition is dedicated to ‘New Beginnings’, and we have a host of articles to get you thinking about what this could mean for you and your care business. From within Albert Goodman, Elaine Grose outlines the tax changes to look out for, whilst Tom Hawes explains the benefits of a digital system such as Xero. If you are considering extending your care facility, we outline the things to consider and, with the country opening up again, news on care sector conferences to attend in the coming months. Enjoy the edition.
Michelle Ferris Partner, Head of Charities and Care, Albert Goodman
A ‘GREEN’ CARE HOME IN THE SOUTH WEST! Regular readers of this newsletter may recall that in our Summer 2021 edition we focused on environmental issues and shared with you suggestions of how you can make your care facility more efficient and environmentally friendly. We’re therefore delighted to learn that Cornerstone Healthcare has received planning permission to build an 80bed ‘green’ nursing home in Bristol. The home is due for completion in Autumn 2023 and has been designed to be thermally efficient, so it will retain heat in the winter and stay cool in summer. It will have solar panels on the roof to provide electricity, and use environmentally friendly air source heat pumps to heat or cool the building, features which were suggested in our newsletter.
THE YEAR THAT THE CHANCELLOR FROZE Elaine Grose, Senior Manager at Albert Goodman, outlines the tax changes (and things which aren’t changing) in the forthcoming tax year; and why it is so important to get the basics right. After the unprecedented business and employment support, 2022 is the year in which the Chancellor begins to demand payment for the bill. One way in which this will take effect is the freezing of a myriad of thresholds, allowances and reliefs from 6th April 2022; The personal tax allowance and Income Tax thresholds will remain at their 2021/22 levels until 5th April 2026. The pension lifetime allowance is frozen at £1,073,100 until 5th April 2026. The Capital Gains Tax annual exemption of £12,300 (£6,150 for trustees) is frozen until 5th April 2026. Both the Inheritance Tax nil-rate band of £325,000 and residence nil-rate band £175,000 are frozen until 5th April 2026. ISA thresholds will remain at their 2021/22 level.
Later changes include: The EIS sunset clause remains intact ending this relief on 6th April 2025. The Super Deduction is set to end 31st March 2023 coinciding with the Corporation Tax rate increase. The Annual Investment Allowance of £1m is set to reduce to £200,000 from 1st April 2023.
Then comes the tax rises: Employees, the self-employed and employers will see national insurance rates rise by 1.25 percentage points from 6th April 2022. Dividend tax rates will increase by 1.25 percentage points from 6th April 2022. Companies will see the Corporation Tax rate increase by 6 percentage points to 25% for profits over £250,000 from April 2023 (profits over £50,000 impacted also). Companies with 12-month accounting periods commencing after 1st April 2022 will therefore be impacted. Whilst political shenanigans and the next general election will no doubt alter the above position, there is a very real debt to be paid. Without a doubt we will all feel the tax pinch for the foreseeable future, therefore getting the basics right will prove even more crucial. Some things which you might like to consider include; 1. Implementing salary sacrifice arrangements for auto enrolment. 2. Providing tax efficient benefits. 3. Bringing forward bonuses/dividends. 4. Reviewing capital allowance claims carefully. 5. Utilising available tax allowances and reliefs. 6. Consider tax deferral claims carefully.
For more information, contact Elaine Grose on 01823 250368 or email elaine.grose@albertgoodman.co.uk
EXTENDING YOUR CARE HOME: There’s a lot to think about
There are many reasons why you may consider extending your existing care home. Additional communal space, bedrooms which are better designed to meet the expectations of residents and families, or simply the desire to generate more income are all cited as the driving forces behind expansion plans. But what are the key things you should consider when planning an extension?
1. FUNDING Extending an existing facility often requires significant investment and therefore, commercial backing. Securing appropriate funding for architects’ fees, planning permission, builders, and many other expenses will be a key part of the successful expansion of services. You should strike a balance between the need for borrowing and the income likely to be generated from providing care services.
2. WHAT IS REALISTIC? Be clear about your main goal (or goals) for the extension project. Are you aiming to increase communal space or beds? This will affect how the project can be funded and what the likely return will be. Also consider the type of building you currently have, as this will affect your planning application. If it is listed or has any kind of restrictions, then the planning process may be more complex. Also consider your current outside space, as this is likely to be reduced. Timescales are also important, as you will need to build this into your costs and make a plan for liaising with residents, families, staff and neighbours as the work commences.
3. THE EXISTING RESIDENTS However considerate your contractors are, and however
much you keep your existing residents and their families informed, there is bound to be disruption to their lives. There are however ways to make the experience a positive one: Involving residents in choices relating to the project, for example, the décor. Encouraging the residents and contractors to interact with each other. The process means that there will be new faces to greet every day and new things to see, which can be of great interest! If any of your residents have worked in the building or associated trades, use it as a reminiscence topic.
4. THE NEIGHBOURS Keeping the owners of any neighbouring properties happy is vitally important. This means considering how it will affect them and ensuring (as much as you can) that deliveries come at agreed times; that they are forewarned of any periods of increased noise/dust; and that workmen park considerately in the area. Ensure that each affected neighbour has a list of telephone numbers for individuals such the site manager and home manager, which they can telephone if required.
FINALLY Don’t forget to have a big party to open the new facility, and invite everyone along. It is a great way to thank them for their patience, and is also excellent PR. If you wish to discuss funding an extension of your care home, telephone Neil Hutchings, Corporate Finance Director, on 01823 250793 or email neil.hutchings@albertgoodman.co.uk
Taking your payroll to the clouds:
Utilising Xero for your care homes Tom Hawes, Business Services Manager at Albert Goodman, explains why a change to a cloud-based Payroll system may simplify the management of your care home(s).
Everybody likes getting paid, but getting to that point each month can be a headache for those running the payroll. Clunky old software, time-consuming tasks and poor reporting are problems that could all be resolved with a switch to online payroll software such as Xero Payroll. By using Xero Payroll your records are kept securely in the cloud, meaning that you are no longer tied to the same computer in order to complete the payroll function; giving you the flexibility of completing your payroll wherever you may be. If your desktop computer gives you the ‘bluescreen of death’, you can simply switch to a different computer and away you go - with the same information in the same system. There are several different cloud-based payroll systems to choose from, so why look at Xero Payroll? Using Xero Payroll means HMRC’s reporting requirements are all sorted and filed by the software. Xero Payroll can calculate and file your pension information and re-enrolment admin, or help you track employee’s leave entitlements. Your employees’ lives can be made easier with Xero Payroll’s app, where they can self-service viewing their payslips or manage their requests for annual leave. Combining Xero Payroll with your accounting records in Xero also gives you great reporting in a streamlined process. For example, if you have staff working across several care homes and find it difficult to split staff costs between sites, Xero Payroll can post this information in Xero automatically for you. Another great benefit of Xero and its payroll offering is the wider ecosystem that can integrate with it. Perhaps you have a system for your staff scheduling, but wish it could be synchronised to your payroll system? Are you always chasing staff for hardcopies of their timesheets? Or perhaps you have a management system generating your invoices that you’re not looking to change? All of these scenarios can be aided with software that integrates with your accounting and payroll system. Whether you’re completing your first pay run or have been running your systems for years, taking a moment to assess your options or whether a switch to Xero Payroll may prove fruitful in removing any difficulties or headaches you have in running your payroll.
If you would like to speak to one of our experts about Xero, Xero Payroll, or any associated apps, please get in touch for a free discussion or demonstration. Telephone Tom Hawes on 01823 250396, or email tom.hawes@albertgoodman.co.uk
AN INSIGHT INTO THE CARE HOME OUTLOOK 2022 Mark Hickman, Director of Chandler & Co, shares his thoughts on the current situation in the sector and what the future holds.
Starting with a reflection of the last two years we can conclude that the care sector like many others has shown its resilience and, despite the challenges, will continue to do so. Care Home deals definitely picked up apace in the final quarter of 2021, with a positive outlook from funding applications and investors alike. So what are the challenges in the sector now, and what is on the horizon? The last two years saw a slowdown in care home assets coming to the market, whilst owners buckled down to protect their residents and staff during the pandemic. With Government funding there was enhanced investment in Infection Protection Control and digitisation was accelerated, with more emphasis on staff wellbeing and training remotely. Trust in Care Home safety has moved into positive territory, with the regulator evolving as appropriate to strengthen its position as families and third parties seek assurance from their rating and inspection reports. Although operators suffered from reduced occupancy in the early stages of the pandemic this started to turn around during 2021, as providers adjusted their systems and processes and opened their doors to new residents subject to safe staffing levels. Staffing difficulties have been well publicised, and this situation will continue to be a focus in the immediate future. However, the inclusion of carers on the Short Occupation List (SOL) and the Health and Care Worker Visa, will no doubt assist recruitment. Utilising the Government’s strategy for the sector with the £60m Adult Social Care Omicron Support Fund, which is in addition to the £388m infection control and testing fund announced in 2021, will help support recruitment and retention.
2022 will no doubt continue to offer challenges to the sector but its resilience will continue, with first time owner buyers coming to the market as well as those seeking their second or third home, in addition to an increasing merger and acquisition market. Interest from investors abroad also continues. The Care Quality Commission intends to recognise improvement through re-rating, which will be vitally important for the sale and acquisition process, together with new guidance on the ‘Right Support, Right Culture’ for registering a service supporting people with a learning disability. Inspection activity will be targeted at services needing it the most, from new registrations to existing services, for an up to date view of the risk and service quality, including good practice. These reports will continue to be of great importance for providers, service receivers and third parties alike. The future of the care sector is that it is here to stay. There will always be a need and the need is growing, probably even more so as the pandemic plays out. Confidence in the sector remains, despite the challenges, and we can expect a busy year ahead. Fee increases will continue to evolve across the sector together with operational costs, to be met with a changing public and Government perception of funding and responsibility and ownership of care. Looking ahead the Care Home and broader care sector is open to investment, through acquisition and care home asset improvement. For further information regarding buying a care home and running a care home visit ‘buyacarehome.com’ and ‘ownacarehome.com,’ sponsored by Care Home specialist Finance Brokers Chandler & Co, where the brokerage team arrange finance packages for all aspects of funding.
Care News for the South West The Albert Goodman client base covers a wide area of the West and South West of England. Here are a few recent news items which you may not have seen, but which could impact you or your care colleagues in the region. Care Home Professional reports that Councils have warned they could face a ‘budget blackhole’ because of the underfunding of adult social care reform. With only £5.4bn ring-fenced for social care of the £36bn raised from the health and social care levy over the next three years, councils are concerned that the funding falls short of the likely costs, the Local Government Association (LGA) has warned. Echoing this concern, Somerset Live reports that the impact of the Pandemic across North Somerset will be felt for many years. It quotes Hayley Verrico, the council’s director of adult social services, who said that pressures are being felt across the board, from hospitals unable to discharge healthy patients to carers facing a cost of living crisis. Even if all the cash raised by North Somerset Council’s 3% council tax increase was handed to adult social care, it would not cover its escalating costs. Moving away from funding and towards technology, Care Home Professional quotes Health and Social Care Secretary Savid Javid, who wants to see all care providers adopt digital social care records. “I want to see a particular focus on social care, where around 40% of providers are still grappling entirely with paper-based records,” he said.
CARE ENGLAND CONFERENCE 23RD MARCH: FACING THE FUTURE Care England’s Conference in March also looked at new beginnings, with the theme of ‘Facing the Future’. It focused on the action taking place in key areas of the sector to further improve the quality of social care. The Albert Goodman team attended the event and we look forward to hearing the team and Michelle’s thoughts in our Summer edition.
National Awareness Days and Events If you’re thinking of refreshing your activities planning and/ or your PR this year, why not link yourself into some of the great ‘Awareness’ events which happen every year? Not only will they give your activities team ideas and themes for resident activities, but many of them have ready-made marketing resources such as posters and social media posts, saving a lot of time!
2nd – 5th June QUEEN’S PLATINUM JUBILEE WEEKEND
Here are a few taking place in the coming months:
1st October INTERNATIONAL DAY OF OLDER PERSONS
25th April – 1st May NATIONAL GARDENING WEEK
6th - 12th June CARERS WEEK 1st-30th September WORLD ALZHEIMER’S MONTH 30th September ‘WORLD’S BIGGEST COFFEE MORNING’ FOR MACMILLAN
End note As we reach the end of another edition, I hope the preceding articles have given you food for thought on potential positive changes for your care business. As ever we welcome your feedback and ideas, so please do get in touch if there is anything which you would like to see addressed in future Care Newsletters. For now, I wish you a prosperous beginning to the new financial year and hope to see you at one of the upcoming care events.
Michelle Ferris Head of Charities and Care, Albert Goodman
Date for your diary 21st June Care & Occupational Therapy Show (Westpoint Arena, Exeter)
4th - 7th July UK Care Week (Online 4th-5th, NEC Birmingham 6th-7th) 12th - 13th October Care Show (NEC Birmingham)
DID YOU KNOW...? Albert Goodman can provide your care business with: Accounts and Audit compliance Consultancy for business development/growth Acquisition and sales advice Property Capital Allowance reviews (to release ‘hidden’ tax reliefs) Corporate and personal tax services for owners (compliance, advisory, restructure, succession and exit planning) Later Life Care funding solutions Corporate Finance including valuations and due diligence for acquisitions and sales Workplace pensions Payroll Bookkeeping Outsourcing App Advisory
CONTRIBUTING TO YOUR SUCCESS If you would like to discuss any matters in this newsletter please get in touch with your usual Albert Goodman contact or Michelle Ferris direct.
michelle.ferris@albertgoodman.co.uk
Facebook “f ” Logo
01823 286096
www.albertgoodman.co.uk
@AG_LLP
CMYK / .ai
Facebook “f ” Logo
CMYK / .ai