To answer this and the other inevitable questions will take a large investment in terms of time, resources and almost certainly accountants (sorry and yes, other professional advisers are available). The first thing people in business are going to think when it comes to net zero is most likely going to be “how am I going to pay for this?”. The good news is the government already has some tax structures in place to help with this.
- 1. Climate Change Levy – a tax collected by energy suppliers and paid by businesses and the public sector to encourage them to become more energy-efficient.
- 2. Carbon Price Support – to incentivise electricity generators to invest in low-carbon electricity by increasing the cost of fossil fuels.
- 3. Landfill Tax – to divert waste from landfill to less harmful methods of waste management
- 4. Aggregates Levy – to encourage the use of recycled materials over the extraction of rock, sand and gravel which can damage the environment
- 5. You can claim ‘enhanced capital allowances’ (a type of first-year allowances, which is in addition to the Annual Investment Allowance) for:
- • New zero-emission goods vehicles
- • Some cars with low or zero CO2 emissions
- • Energy-saving equipment on the energy technology product list
- • Water-saving equipment on the water-efficient technologies product list
- • Plant and machinery for gas refuelling stations
- • Gas, biogas and hydrogen refuelling equipment
There are also some grants available from Innovate UK – offers grants targeted at companies developing technology for sustainable purposes – and The Sustainable Innovation Fund – to help stimulate clean growth recovery in light of COVID-19 across all the sectors of the UK economy. Even one to create woodland and plant trees
Scottish businesses can access interest-free green loans up to £100k to help pay for energy and carbon-saving upgrades and potentially a cashback grant of up to £20k. Scots can also apply for the Low Carbon Transport Business Loan which offers up to £120,000 interest-free to help reduce the carbon impact and fuel costs of their transport arrangements through the purchase of new, more efficient vehicles.
Ultimately, a huge shift is still needed to encourage and enable businesses to work out their current position whilst steering themselves towards a better, more sustainable future and (unlucky for some!) there is no avoiding that Accountants & Auditors are going to need to be at the heart of that process.
Businesses need clarity and they need guidance. People do too. And we need it fast. As a starting point, reach out to your accountant today to ask what you need to do now, tomorrow, and how the hell you work it all out.
About the author: Andrew Oury, Partner and Advisor at Oury Clark.
Source: CEO Today Magazine