Turnover surged by more than £70m at a nationwide business providing payroll and accountancy services for recruitment agencies and contractors in the year before the Covid-19 pandemic struck, new accounts have revealed.
PayStream, which is headquartered in Altrincham, has reported a turnover of £475.5m for the 12 months to March 31, 2020, up from £403.3m.
Its pre-tax profits also increased from £5.1m to £5.8m over the same period.
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A statement signed off by the board said: "Turnover generated from the provision of accounting and tax services to limited company clients has remained at a similar level to 2018/19.
"Following growth in the first half of the year, revenue from limited company clients began to decline in the second half.
"This was as expected ahead of the changes to 'off-payroll working' for the private sector that had been due to take affect from April 2020.
"This change was subsequently delayed by a year to April 2021 as part of Her Majesty's Government response to the Coronavirus pandemic.
"Overall turnover increased by 18%. Growth accelerated in the second half of the year with the number of contractors choosing to work via an umbrella increasing an anticipation of the planned changes to 'off-payroll working' for the private sector.
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"The effect of these changes has been complemented by the preferred supplier status with an increasing number of recruitment businesses and a strong sales effort.
"Operating profit increased by 14% during the year. This increase is a direct result of increased umbrella volume as described previously."
On the pandemic, the company added: "As with most businesses, Covid-19 has had multiple impacts on the business which we have responded to fully.
"The initial uncertainty on how this crisis would unfold and impact our financial position meant that it was prudent to take advantage of Government assistance in the form of both the deferment of VAT liabilities and also the claim of grants through the Coronavirus Job Retention Scheme.
"As some of the financial risks we were concerned about did not subsequently materialise and both the profitability and cashflow have remained steady, we decided to settle the VAT liabilities ahead of the extended deadline and also repay furlough sums received in respect of the PayStream employees we were subsequently able to retain."
PayStream was founded more than 30 years ago as a traditional firm of accountants services to SMEs.