There has been a recent tightening up of the rules relating to overdrawn loan accounts in what HMRC describe as Close companies (normally those with less than 5 Directors or major shareholders). This combined with the changes in taxation of Dividends has created higher personal tax liabilities and advance payments of corporate tax impacting on […]
Small Limited Liability Companies and borrowed finance during the Covid-19 lockdown
The section 455 surcharges on overdrawn directors’ loan accounts will increase during and after the current business lockdown. Especially in sectors that are not currently active, such as freelancers and leisure related sectors. Small Companies that fall into the category of Close companies, normally with less than 5 Directors or major shareholders, have been encouraged […]
Budget 2021 / Tax Rates
Guide from The Helpful Bean Counter 2021/22 2020/21 £ £ Income tax rates: England, Wales & Northern Ireland(non-dividend income) (note 1) 0% starting rate for savings only Up to 5,000 Up to 5,000 20% basic rate tax 12,571 – 50,270 12,501 – 50,000 40% higher […]
Virtual Finance Director to SME’s
Many small growing companies do not have a Financial Director, but need support in order to develop their businesses. This is often the type of support that their Auditors / Accountants are unable to provide. These companies need someone who can be part of their management team, but is not going to cost them at […]
Principle Private Residence rules have recently changed
I was asked recently by a client as to what tax reliefs were available where their home (Principle Private Residence) was let under a tenancy agreement, rather than sold when they moved. This was something that we had done a number of years ago, but I needed to brush up on the current rules. The […]
IR35 Changes and the Concept of ‘Deemed Employees’
Companies and freelance contractors need to prepare for the proposed changes to IR35 and the concept of ‘Deemed Employees’ The changes were introduced into the Public Sector from April 2017. It is still a proposal, but the intention is to introduce the same rules to large companies in the Private Sector from April 2021. (was […]
R&D Tax Credits
The reason for this Blog is that I was very surprised that a local firm that is in involved marine design and development, which I was providing mentoring support to, had to use a specialist consultant to recover their entitlement for R&D tax credits. The firm are using a well established mid-sized regional firm of […]
Finding an Accountant
There are not many professions where it is possible to set up in business without any need for qualifications. But you can set up as an Accountant and Tax Adviser without any qualifications or experience. There are some major franchises which take anyone willing to pay their fees, and set them up as Accountants after […]
Dividends or Salary – What is Best?
For many small Limited Company Owners they are faced with 2 types of taxation. In fact 3 if we include National Insurance. Many of these owners may also have run their businesses on a Sole Trader basis, and still regard the incorporated business as if it was a Sole Trade. Under UK law an incorporated […]
Is Buy to Let worth while?
Buy to Let investments have over the last 20 years been an alternative for many investors to the more traditional methods of accumulating money for retirement. It has also provided properties for those wanting to rent, rather than purchase property, especially as higher property prices have excluded many from becoming owners. I don’t want to […]
End of the Personal Service Company?
The chancellor in his 2018 budget announced that tighter tax rules for those working in the public sector will be extended to those working for private firms. The rules in the public sector have almost eliminated the use of personal service companies. Among those affected will be IT contractors, engineers and consultants. The crackdown is […]
Virtual or Part-time Finance Director – How it can help your business
Many growing SME companies cannot afford the cost of having a full time Financial Director, but they need financial management support on a temporary or part time basis in order to develop their businesses. This is often the type of support that their auditors / accountants are unable to provide and if they can will […]
Successful Grant Applications
I was recently involved in carrying out due diligence on grant applications being awarded by a regional LEP. For confidentiality reasons I will not go into great detail, but the experience has been interesting and I feel that I am in a position to provide guidance to organisations looking for grant funding. There are 30 […]
Flat Rate VAT Scheme Guide
Significant changes are being made to the VAT Flat Rate Scheme from the 1st April 2017. For many contractors who incur limited direct costs, the scheme has provided a great cash benefit. For example, if the contractor invoiced a client £15,000 in a VAT quarter, the contractor would have have charged the client a further £3,000 in VAT. […]
Is dividend still best for small business owners?
Back in 2016 George Osborne changed the way dividend income is taxed! This is a significant change to how small business owners takes income from their Personal Service Companies. The taxation of dividends changed from 6 April 2016 through the fanfare of removing many from paying tax on dividends. The reality for business owners of […]
Property Embedded Fixtures & Features’ Allowances or PEFFs
Did you know that in addition to claiming Capital Allowances on moveable fixtures and fittings used in your business you can also claim ‘Property Embedded Fixtures & Features’ Allowances or PEFFs, on the immoveable assets in your properties? We came across PEFFs recently in discussion with a holiday let business on the Isle of Wight. […]
Importance of VAT Registration
We have many clients who see VAT registration as the ‘end of their business’. But we find many clients totally unaware of the penalties and other fines that can be imposed by HMRC if they do not comply with the regulations. The following details are of a recent case involving non-registration for VAT. The case […]
Auto Enrolment – Are you Ready?
For our Clients and potential clients Just a reminder that the staging date for Auto Enrolment for most Small Businesses has either passed or will happen by January 2018! Have you had any thoughts on which scheme to go for? Are your staff aware that you should have a pension scheme from your staging date? […]
Making Tax Digital
The following paper has been written by Rebecca Cave for accountancy software provider, Tax Calc to provide information on the introduction of Making Tax Digital. Although there has been some delays due to the political situation, it is important for small businesses to prepare for its introduction. The making tax digital (MTD) project represents a […]
Personal Service Company versus the Umbrella Company
Many freelancers and contractors are attracted to the idea of an Umbrella Company to maximise their earnings. But the Personal Service Company can achieve the same tax advantage, plus you can benefit from lower monthly administration costs and other benefits described below. For example, as a freelance journalist you will receive an income probably from a […]
Companies House rejects 2.5% of Accounts prepared under FRS 102
A surge in rejections of company accounts prepared under the new UK GAAP rules, identified by ICAEW, has been refuted by Companies House, which reports that only 2.5% of accounts have been returned, despite hitting the peak reporting period However, a spike in calls to ICAEW helplines have been related to rejection of accounts filed […]
Registering for Self Employment
If you wish to register for self-employment, then you must comply with the official HMRC procedures to ensure that you are paying the correct national insurance (NI) and income tax. How does the government define self-employment? HMRC will consider you self-employed if you are frequently trading goods or services, and take responsibility over the success […]
HMRC’s focus on tax avoidance
HMRC has recently unveiled severe penalties under proposed new legislation seeking to target those intermediaries that provide tax avoidance schemes, and this may have implications for contractors and freelancers, and the use of Umbrella Companies ( Personal services company versus the Umbrella Company ) In the UK tax evasion is illegal, but tax avoidance is not! But […]
Confirmation statements replace annual returns
The annual confirmation statement is a new filing requirement that was introduced on 30th June 2016. It has replaced the annual return (Companies House form AR01) but serves exactly the same purpose in a simplified format. All private limited companies and limited liability partnerships (LLPs) registered in the United Kingdom must deliver at a confirmation […]
New focus on IR35 by HMRC
HMRC are again starting to focus their attention on IR35, so watch out Contractors! Over the last 20 years there has been a significant increase in the number of freelance contractors. Depending on the sector different terminology is used. The writer himself spent a significant period of his career working as an ‘interim’ Accountant. In […]