Monthly Archives

March 2021

Spare Room to Stellar: The Suki Tea Story

It was whilst walking from the Ravenhill Road to the Belfast’s city centre that Annie Irwin and Oscar Wooley decided to start a business. The original idea was to establish a single teahouse in Belfast. They now supply over 2500 thousand outlets across 22 countries and their brand is recognised the world over with a global customer base that has loyally switched to online sales and tea drinking at home during the Pandemic. This is the story of Annie, Oscar and Suki Tea.

Spare Room to Stellar: The BPerfect Story

How do you go from a market stall to a multinational, multi award-winning cosmetics brand? How do you go from a spare room to an ever-expanding local base that supplies over 2,000 shops around the planet? This Belfast start-up now works with some of the world’s most successful make-up artists and has witnessed an 800% increase in online sales during the pandemic. Along the way it has built up a global social media following and its founder turned down two offers on Dragons Den. This is the story of Brendan McDowell and BPerfect Cosmetics.

Spare Room to Stellar: The BLK BOX Story

Pacem is delighted to support a new initiative entitled ‘Spare Room to Stellar‘, alongside Belfast City Council and Danske Bank. Spare room to stellar is designed to inspire and equip Belfast entrepreneurs to start and grow a business. It does this by firstly sharing the stories and lessons of 3 businesses that started in a spare room in Belfast and have gone on to compete, and win, on a global scale.

The first film released in the series is that of Gregory Bradley and BLK BOX.

Gregory Bradley of BLK BOX says: “I started selling dumbbells out of my garage and have ended up designing, manufacturing and installing state of the art gym facilities globally – and if sharing my story inspires others to give their business idea a shot, I’ll be delighted. Taking a small idea and growing it is what Spare Room to Stellar resource is all about. There’s fantastic support available for people starting out on their own in business – and we want to see more people getting out there and giving it a shot.”

Watch the highs, lows, habits and how-tos of starting/growing a business from humble beginnings. Sit back, enjoy and then act on your idea or early venture by booking a signposting consultation over at 

You can view the BLK Box story here:

March 2021 Tax – Budget Edition

Chancellor ‘Levels Up’ With Us on Tax

Rishi Sunak has chosen a fine line between raising taxes to start paying down the massive Government borrowings but at the same time stimulate economic recovery and save jobs. He was also mindful of pledges made in the Conservative Party manifesto not to raise income tax, VAT and national insurance. So that leaves corporation tax, CGT and inheritance tax… Maybe he will delay the announcement of significant increases in taxation until later in the year as it is anticipated that there will be a further Budget in the Autumn. By then the economy will hopefully have started to bounce back.

Self-Employed Income Support Grants Extended

In line with the further extension of the CJRS furlough scheme for employees the chancellor has also set out further support for the self-employed. We had been waiting for the details of the calculation of the fourth SEISS grant covering the period to 30 April and we now know that the support will continue to be 80% of average profits for the reference period capped at £2,500 a month and can be claimed from late April. There will then be a fifth SEISS grant covering the 5 months to 30 September. The chancellor has also bowed to pressure to extend the scheme to include certain traders who were previously excluded. Thus, those who commenced self-employment in 2019/20 will now be included provided they had submitted their 2019/20 tax return by 2 March 2021. This is potentially a further 600,000 traders.

Conditions for the fifth grant will be linked to a reduction in business turnover. Self-employed individuals whose turnover has fallen by 30% or more will continue to receive the full grant worth 80% of three months’ average trading profits, capped at £2,500 a month. Those whose turnover has fallen by less than 30% will receive a 30% grant, capped at £950 a month. We are awaiting further details of this fifth grant.

Corporation Tax Rates to Increase to 25% But Not For All Companies

The UK corporation tax rate is currently one of the lowest rates of the G20 countries and the government states it is committed to keeping the rate competitive. That should have the effect of encouraging companies to remain in the UK and companies to set up here. With other countries considering raising corporate tax rates the chancellor has announced that the UK will follow suit and consequently the rate will increase to 25% from 1 April 2023 where profits exceed £250,000. However, where a company’s profits do not exceed £50,000 the rate will remain at the current 19% rate and there will be a taper above £50,000. Businesses will however be able to take advantage of new tax breaks to encourage investment in equipment and an enhanced carry back of losses.

National Insurance Rates

The national insurance contribution (NIC) rates and bandings were announced 16 December 2020 to take effect from 6 April 2021. Employees and the self-employed will not pay national insurance contributions (NIC) on the first £9,570 of earnings for 2021/22, an increase of £1 a week. The employee contribution rate continues to be 12% up to the Upper Earnings limit £50,270, with the self-employed paying 9% on their profits up to the same level. Note that employer contributions will apply to earnings over £170 per week, £8,840 per annum which is also a £1 a week increase.

 Vat Registration Limit Frozen At £85,000 Until 1 April 2024

The reduced 5% rate of VAT will continue to apply to supplies of food and non-alcoholic drinks from restaurants, pubs, bars, cafés and similar premises across the UK until 30 September 2021. The 5% reduced rate of VAT will also continue to apply to supplies of accommodation and admission to attractions across the UK. From 1 October until 31 March 2022 the rate will be set at 12.5% and will then revert to 20% from 1 April 2022.

5% Mortgage Schemes Extended

Another measure announced to stimulate the housing sector is a new 95% mortgage scheme guaranteed by the government that will mean that people buying a house will only need a 5% deposit where the purchase price is no more than £600,000.

If you have any questions, thoughts or actions relating to the content of this article please get in touch with us by calling us on 028 9099 6948 or by emailing

Inflation ahoy!

The word ‘ahoy!’ is an old maritime warning, usually used when either a ship or land was sighted in the distance as a warning to the crew to beware.  Today, the risk of higher inflation down the line has been sighted by both economists and – of late – the markets.

It is something that investors have not really been focusing on since the global financial crisis, with everything else going on.  Yet, inflation is the silent enemy of the long-term investor that eats away at the purchasing power of their assets.  Even benign inflation can do damage.  The ‘Rule of 72’ estimates how quickly prices will double; all we have to do is to divide 72 by the rate of inflation.  If the Bank of England is successful at meeting the 2% per year inflation target set for it by the UK government, prices will double every 36 years (72/2).  If inflation is higher, then the time to double will be quicker.  For example, at 6% inflation prices double every 12 years.  The chart below provides an insight into the impact of inflation on spending power in the UK.  It shows how much £100 of goods or services bought at some point in the past would cost today.  Even since 2010, things now cost around 30% more than they did.

Figure 1: How much £100 of goods and services in the past would cost today.

Source: Bank of England[1]

Without turning this short note into an economics lecture, a simple model that explores the balance between buyers and sellers of goods and services can be useful when thinking about inflationary pressures.  On the buyers’ side we have the amount of money in supply (M) and the number of times this money is used to buy goods and service in a year (the ‘velocity’ of money or V).  On the sellers’ side we have the price of goods (P) and the amount of goods and services produced (Y).  As everyone knows an equation needs to balance; so, MV=PY.   Since the Covid-19 crisis began, governments around the world have pumped huge amounts of money into the economy, via both quantitative easing and huge stimulus packages, not least the US$1.9 trillion package being touted by the Democrats in the US.  The money supply in the UK, and other major economies, has grown dramatically in the past 12 months.

So far, because people have been restrained from buying goods and services in lockdown, the velocity of money has been low, and spare production capacity exists in the economy resulting in little pressure on prices. Yet as the vaccine program rolls out and we emerge from lockdown constraints, people will begin to satisfy their pent-up demand – using accumulated savings – to buy goods and services, raising the velocity of money back to more normal levels.   On the supply side, economic output should grow utilising spare capacity and creating new jobs.  But if the money chasing goods and services (MV) outstrips the output of the economy (Y), then prices (P) will rise.  This is certainly a plausible scenario and the bond markets have responded to this lately, pushing yields up in compensation and, as a consequence, bond prices down.

So, what would this mean for your portfolio?  Over the medium to longer-term, equities do a good job of delivering investors with returns above inflation.  In the shorter term it is hard to know what the impact on equities will be as on the one hand higher bond yields may undercut equity valuations, whilst on the other, growing optimism and economic growth of a post-lockdown world may improve prospects for company earnings.  No-one knows.  On the bond side, the threat of inflation tends to drive yields higher and bond prices lower.  Fortunately, the bulk of bonds owned in your portfolio are shorter-dated, where price changes are much smaller than longer-dated bonds and the time it takes for you to benefit from this rise in yields will be much quicker.

Inflation (perhaps) ahoy! But no need to panic.  Sail on.

If you have any questions, thoughts or actions relating to the content of this article please get in touch with us by calling us on 028 9099 6948 or by emailing

Risk warnings

This article is distributed for educational purposes and should not be considered investment advice or an offer of any security for sale. This article contains the opinions of the author but not necessarily the Firm and does not represent a recommendation of any particular security, strategy, or investment product.  Information contained herein has been obtained from sources believed to be reliable but is not guaranteed.

Past performance is not indicative of future results and no representation is made that the stated results will be replicated.