Tax & admin · 9 October 2017

Pound coin deadline could be ignored by thousands of small businesses

New and old one pound coins
The return deadline for the old pound coin is set for 15 October

Thousands of small shop owners are likely to continue accepting old round pound coins after the Royal Mint’s official deadline for returning them passes on 15 October.

The Federation of Small Businesses (FSB) has said that its members could consider continuing to accept the old pound coin after 15 October if their business faces significant disruption because of the short changeover period with the new 12-sided pound coin.

Of particular concern to the FSB, which represents over 170,000 firms, are firms which may have had to invest significant time and money in modifying coin-operated machinery in order to accommodate the new pound coin.

Such businesses may have included food and drinks machine vendors, or arcade games machine operators, for example.

Commenting ahead of the 15 October deadline, national chairman at the FSB Mike Cherry said that for many small companies the changeover period may have proved too short.

He added: “While no business is obliged to accept the old coins beyond the deadline, it would help if small firms knew they were allowed a short transition period to collect the old coins if they wish to, and are willing to bank them, but not give out to customers.

The cash struggles business owners have with new notes and coins

“This would provide a useful community service, allowing customers a few weeks to get rid of the final few pound coins in circulation.”

From midnight on Sunday 15 October, the old pound coin will lose its status as legal tender, and the government has advised shop and restaurant owners not to accept them after this date.

The Royal Mint has announced that even though around 1.2bn old pound coins have already been returned, around 500m remain in circulation one week before the deadline.

A statement to business owners, published on the Royal Mint site, read: “You are under no obligation to accept the round pound coin from your customers and you should not distribute the round pound coin. Please update your staff on what they need to do.”

Meanwhile, CEO and Deputy Master at The Royal Mint, Adam Lawrence, said: “The round pound has been in circulation for over thirty years but, as the deadline approaches, we are keen to encourage everyone to track down their final coins and use them.

“As the deadline is triggered, we are proud that the security features on the 12-sided pound coin will help to safeguard our currency for years to come.”

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ABOUT THE EXPERT

Fred Heritage is deputy editor at Business Advice. He has a BA in politics and international relations from the University of Kent and an MA in international conflict from Kings College London. He previously worked as a reporter at Global Trade Review magazine.

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