The amount of office space in England shrank during the Covid-19 pandemic, contracting by more than a million square metres as the work-from-home trend continues amid a surge in the number of infections.
Office space fell 2 per cent in the 12 months to March 31 last year, according to the Valuation Office Agency, which is part of HM Revenue & Customs. The decline represents more than 1.67 million square metres – equal to 35 times the floor space in the Gherkin office building.
With many workspaces either lying empty or dormant, developers are facing increasing pressure to make offices more flexible and environmentally friendly to adapt to new pandemic-induced work patterns and increased environmental regulations.
The office space contraction comes as companies are gearing up for a surge in workplace absences amid the latest surge in Covid-19 cases.
Ministers have been urged to develop “robust contingency plans” to help companies to cope with rising workplace absences, with the government issuing a warning that up to a quarter of staff could be off work as the Omicron variant sweeps through the country.
The UK has hit a record number of daily cases during the festive period, with the transport sector already heavily affected by staff absences along with the NHS.
With those affected by Covid required to isolate for seven days, the issue is particularly affecting industries where staff are unable to work from home.
For office-based companies, however, encouraging staff to come into work has become more of a challenge amid the Omicron surge, in turn causing a headache for developers with office space occupancy levels falling to 10 per cent in England in the week before Christmas when the government urged people to work from home if possible.
Property experts said the amount of empty office space would have fallen even further since March as employers look to a future of more flexible workspaces, with staff coming in on a rotation basis and, in turn, requiring less physical space.
Mat Oakley, head of European commercial property research at consultancy Savills, told the Financial Times that the UK will not need as much office space in the future “if high levels of agile working remain”.
Mr Oakley expects the flexible work trend to persist beyond the pandemic, making up to one in 10 offices surplus to requirements within five years – making older buildings that fail to meet stricter environmental standards redundant.
“Some stock is no longer fit for purpose,” he said.
As 2022 begins, CBI chief economist Rain Newton-Smith said businesses stand ready to work with the government to lift confidence. Clear forward guidance for companies will be crucial to protect jobs and growth.
“But if infection and hospitalisation rates continue to grow across the country, the potential of further measures will weigh on firms,” said Ms Newton-Smith said.
“The government must monitor the situation closely and ensure that any new restrictions go in lock-step with further targeted cash-flow support to those firms most in distress across sectors [affected].”
Meanwhile, the late payment of invoices is threatening the survival of small companies, according to the Federation of Small Businesses (FSB). It fears that late payments, high inflation and mounting administration costs for businesses that trade internationally could cause numbers to shrink if something is not done about these issues.
Of the 1,271 small businesses owners interviewed in an FSB study, 30 per cent said late payment of invoices had increased over the last three months while a further 8 per cent said they were dealing with other ways in which they were not being paid on time.
"The small business community diminished in size over the past year and, unless action is taken now to tackle the challenges it faces, history is set to repeat itself," FSB national chairman Mike Cherry said.
Up to 440,000 could be forced to close this year due to late payment alone, according to the FSB study.
yallacompare profile
Date of launch: 2014
Founder: Jon Richards, founder and chief executive; Samer Chebab, co-founder and chief operating officer, and Jonathan Rawlings, co-founder and chief financial officer
Based: Media City, Dubai
Sector: Financial services
Size: 120 employees
Investors: 2014: $500,000 in a seed round led by Mulverhill Associates; 2015: $3m in Series A funding led by STC Ventures (managed by Iris Capital), Wamda and Dubai Silicon Oasis Authority; 2019: $8m in Series B funding with the same investors as Series A along with Precinct Partners, Saned and Argo Ventures (the VC arm of multinational insurer Argo Group)
Last-16 Europa League fixtures
Wednesday (Kick-offs UAE)
FC Copenhagen (0) v Istanbul Basaksehir (1) 8.55pm
Shakhtar Donetsk (2) v Wolfsburg (1) 8.55pm
Inter Milan v Getafe (one leg only) 11pm
Manchester United (5) v LASK (0) 11pm
Thursday
Bayer Leverkusen (3) v Rangers (1) 8.55pm
Sevilla v Roma (one leg only) 8.55pm
FC Basel (3) v Eintracht Frankfurt (0) 11pm
Wolves (1) Olympiakos (1) 11pm
The stats
Ship name: MSC Bellissima
Ship class: Meraviglia Class
Delivery date: February 27, 2019
Gross tonnage: 171,598 GT
Passenger capacity: 5,686
Crew members: 1,536
Number of cabins: 2,217
Length: 315.3 metres
Maximum speed: 22.7 knots (42kph)
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
Heather, the Totality
Matthew Weiner,
Canongate
Name: Peter Dicce
Title: Assistant dean of students and director of athletics
Favourite sport: soccer
Favourite team: Bayern Munich
Favourite player: Franz Beckenbauer
Favourite activity in Abu Dhabi: scuba diving in the Northern Emirates
Like a Fading Shadow
Antonio Muñoz Molina
Translated from the Spanish by Camilo A. Ramirez
Tuskar Rock Press (pp. 310)
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COMPANY%20PROFILE%20
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Remaining Fixtures
Wednesday: West Indies v Scotland
Thursday: UAE v Zimbabwe
Friday: Afghanistan v Ireland
Sunday: Final
Temple numbers
Expected completion: 2022
Height: 24 meters
Ground floor banquet hall: 370 square metres to accommodate about 750 people
Ground floor multipurpose hall: 92 square metres for up to 200 people
First floor main Prayer Hall: 465 square metres to hold 1,500 people at a time
First floor terrace areas: 2,30 square metres
Temple will be spread over 6,900 square metres
Structure includes two basements, ground and first floor
