Business Accountant

Is your pension going Dutch?

July 2, 2014 5:00 am / Leave a comment

I love Holland but are their Collective pensions better than ours?

Collective funds pool all contributions into one big fund, so the administration costs are lower and pensions are paid from the fund rather than having to buy annuities.

By running funds collectively rather than individually (the British model) costs are reduced.

Some experts suggest that savers will increase their investment returns by 30%.

An article in the Telegraph 3rd June 2014 commented…

What is certain is that the schemes are a long way from the final salary “gold standard”. There are no guarantees, not even the certainty of a fixed income that you get with an annuity. You may get inflation-linked increases, you may not.

Assuming that these schemes do become available in the coming years, the best course for most workers would probably be to use them for some, not all, of their pension savings, with the rest in traditional schemes, self-invested pensions or Isas.

But will they ever see the light of day? There is little incentive for companies to back them – finance directors remember what happened with final salary schemes, which drove many firms to the brink of bankruptcy thanks to endless “gold-plating”.

So will your pension be going Dutch?

steve@bicknells.net

Should I or shouldn’t I?

July 1, 2014 4:07 pm / Leave a comment

Having just organised the CIMA Members in Practise (MiP) two day annual conference – along with a great team – I thought it would be a good time to explore the theme of volunteering.

For most of us running our businesses is a fairly all consuming activity and we can generally fill every minute of our working day. This makes us feel that taking on any additional work as a volunteer would just be too much hassle.

However, I have found that unexpected dividends can come from doing that bit extra.

Firstly, I have been taken well out of my comfort zone. Accountants, even management ones, are not generally called upon to find great speakers on a limited budget, to fill a two day programme. We are not natural marketeers and struggle to ‘sell’ to anyone. But I have been forced to address these issues and conquer my natural tendency to avoid tasks I find difficult.

In the short, medium and long term this will stand me in very good stead when looking to grow my own business.

Secondly, I have been able to ‘give back’. When I started my businesses there were several key people without whose help my journey would have been much more tortuous. Top of the list of these key people were long standing MiPs whose insights helped me to make important short cuts.

Conference is a key way for new MiPs to take similar short cuts by getting the help of established members in practise and excellent CPD they may not have access to otherwise. So by being involved as a volunteer I feel I am thanking the guys who invested in me.

Finally, volunteering has helped me to make life-long friends with some really great people. I have got to know my fellow volunteers really well and feel I have broadened my support network in a way I would not have been able to do otherwise.

So if you have the opportunity to become involved – take it!!

🙂 Fiona

Setting up business finances – Do’s and Don’ts

June 30, 2014 5:00 am / 1 Comment on Setting up business finances – Do’s and Don’ts

For any business owner getting the right financial advice when you start the business is critical, here are some Do’s and Don’ts

Separate your bank accounts

Many start ups try mixing business and personal transactions in their personal bank accounts, its a total nightmare, don’t do it, get a business bank account.

Mixing things up will almost certainly have tax implications.

Get help and register for Tax

Getting things right at the beginning is extremely important and a CIMA Accountant can makesure you choose the right business structure and help you register for VAT, PAYE, CIS and other taxes. Choosing the right VAT scheme will save you tax – take a look at this blog

Not registering and filing returns will have severe consequences and lead to fines and penalties.

Contracts

Ask your Accountant to review you contracts, they will be able to give you lots of useful tips.

Funding

Draw up a Budget and Cashflow and forecast how much cash you will need to run the business, looking at your cash cycle and managing it will be vital.

If you need funding ask your Accountant for help, they will be able to look at all the options and help you choose the option thats best for your business.

Accounting

Many start ups fail to keep control of their accounting, by working with an accountant you can avoid this problem and they can help you choose the best accounting solutions for your business.

steve@bicknells.net

SMEs reluctant to borrow…

June 26, 2014 6:26 pm / Leave a comment

High growth small and medium-sized enterprises (SMEs) are reluctant to seek finance from banks to fund growth, a study by the Institute of Chartered Accountants of Scotland (ICAS) has found.

The study found that high growth SMEs are “highly reluctant borrowers” because of their lack of trust in banks. Many firms also said they were unwilling to sacrifice their autonomy in order to access bank finance.

The study also found that high growth SMEs:

are 9% more likely to seek bank finance than other SMEs but are no more or less likely to receive it
prefer bank finance to equity finance
are likely to use a ‘mixed cocktail’ of finance, including internal resources and debt.

The report, Funding issues confronting high growth SMEs in the UK, was launched to study the demand for finance among high growth SMEs and investigate the problems they encountered.

It focuses specifically on high growth SMEs because of their capacity for growth and employment.

To read more about the recommendations to increase the liquidity to SMEs http://www.grant-jonesaccountancy.com/news-item/smes-reluctant-borrow

Fiona@grant-jonesaccountancy.com

Annual Investment Allowance Tips

June 26, 2014 5:00 am / Leave a comment

What is the Annual Investment Allowance (AIA)?

The AIA was introduced in 2008. It is an allowance for tools and equipment meaning a business can write off 100% of qualifying capital expenditure (up to a set limit – currently £500,000) against taxable profits for the same period. (Expenditure over the limit is subject to the normal writing down allowances of 18 or 8 %.)

AIA is an incentive for businesses to invest because it accelerates the tax relief available, so it can all be claimed in the year of investment, rather than over a number of years, helping a business’s cash flow.

It also simplifies tax. The majority of UK businesses have qualifying expenditure less than £500,000, so they can just write this off and don’t have to make writing down allowance calculations every year.

What is the limit for AIA?

From April 2014 to 31 December 2015 AIA has been set at £500,000 per year.

From 1 January 2016 it will return to £25,000 per year.

E.g. If for the period 1 April 2014 to 31 March 2015 your taxable profits are £1,000,000 and you have spent £450,000 on qualifying capital expenditure, you can write that full amount off against your taxable profits and taxable profits will be £550,000.

Who can claim AIA?

AIA is available for companies, individuals and partnerships, where all the members are individuals.

What kind of expenditure does it cover?

It’s available for most assets purchased by a business, such as machines and tools, vans, lorries, diggers, office equipment, building fixtures and computers. It does not apply to cars.

You can find guidance on claiming AIA in the Capital Allowances Toolkit. This is one of a suite of products designed to help agents avoid errors seen in real returns.

ruthbulteel, 25 June 2014

New ISA’s (NISAs) just around the corner…

June 25, 2014 9:29 pm / Leave a comment

Nearly two thirds (63%) of UK adults are unaware of the tax free savings allowance one week before the launch of New ISAs (NISAs), according to research from MoneySuperMarket.

The survey by the comparison site reveals that 32 million people do not know about the introduction of NISAs.

Of those that have heard of them, 24% do not understand the new rules.

Key findings:

68% of 18 to 34 year-olds have not heard of NISAs, rising to 70% of people aged 35-54
35% of respondents said they are likely to use a NISA, while 30% said they are unlikely to
45% of 18 to 34 year-olds said they might use the new savings products
33% of over-55s are likely to use a NISA
28% believe NISAs will help them save more
45% of 18 to 34 year-olds think they will save more, dropping to 26% of 35 to 54 year-olds and 18% of over-55s.

fiona@grant-jonesaccountancy.com

15 Benefits that won’t be on your P11D

June 25, 2014 5:00 am / 3 Comments on 15 Benefits that won’t be on your P11D

It’s P11D time, but have you considered giving your employees benefits in kind that are tax free, here are some to choose from:

Pensions – Up to £40k can be paid in to you pension schemem by your employer (2014/15) and you can use carry forward to pay in even more
Childcare – Up to £55 per week but check the rules to makesure your childcare complies (HMRC Leaflet IR115)
Mobile Phone – One per employee
Lunch – Tax Free Lunch Blog
Cycle Schemes – Cycle to Work Blog
Fitness – Fitness Blog
Parties and Gifts – Christmas Blog
Parking – Parking Blog
Business Mileage Allowance – 45p for the first 10,000 miles then 25p
Long Service Award – A bit restrictive as you need 20 years service, the tax free amount is £50 x the number of years
Eye Tests and Spectacles – The Eye Test must be needed under the Health & Safety at Work Act
Suggestion Schemes – Suggestion Scheme Blog
Insurance such and Death in Service and Income Protection – Medical Insurance Blog
Travel Expenses – Travel Blog
Working From Home – Working from Home Blog

steve@bicknells.net

New Government Funding to help Women in Business

June 20, 2014 5:00 am / Leave a comment

Last months ONS figures show more people are becoming self employed than ever before.

Budding female entrepreneurs are set to benefit from superfast broadband with a new £1m challenge fund, enabling them to work effectively, access new markets and grow their business online.

The fund will be part of the Government’s Superfast Broadband rollout and will help women take full advantage of all the opportunities superfast broadband can bring to business. There are 40 local broadband projects in England, already delivering the programme and they submitted bids to the £1m challenge fund in May 2014.

This forms part of help the Government is already providing to female entrepreneurs, which includes:

£1.6 million to support women’s enterprise in rural areas;
access to over 15,000 free business mentors; and
from next year, the introduction of Tax Free Childcare will mean that, for the first time, many self-employed parents will have access to support with childcare costs.

Are we doing enough to help women in business?

steve@bicknells.net

A closer look at home workers

June 19, 2014 5:00 am / Leave a comment

Tax Benefits

http://stevejbicknell.com/2013/01/06/what-are-the-tax-issues-and-advantages-of-a-home-office/

Why use a Freelancer

http://stevejbicknell.com/2013/08/12/5-reasons-why-freelancers-are-taking-over-the-world/

20 Home Based Businesses

http://stevejbicknell.com/2013/10/16/20-businesses-you-can-run-from-home/

steve@bicknells.net

Eight ways to cure the time management problem

June 17, 2014 11:00 am / Leave a comment

We all know that poor time management is important. But if we really accounted for our time in the same way that we did every other cost we would probably be in for a shock. According to research by global consulting firm Bain & Co and enterprise analytics company VoloMetrix, company executives receive 30,000 external communications a year compared with 1,000 in the 1970s.

The research revealed big productivity losses related to time management because businesses to not track and monitor employees’ time as closely as they track other resources, such as capital.

Do you record time spent as a cost against individual sales in your P&L or does it just fall into the salaries line in your overheads? Knowing how much time directly supports your sales is a critical performance measure. So if you already do this where does the rest of the time go?

The top eight time consumers according to the report are:

Muddled company agendas. Agendas should be clear for everyone in the company so that employees know which tasks are the top priority and the tasks that can be shelved.
A time is free attitude. Time is clearly not free and should be managed as carefully as any other asset or resource.
Projects. Having the bright idea is the easy bit. But does the business case for the project really stand up when the time factor is costed properly.
Too many layers. The more organisational layers the more work is created in managing and communicating before the core tasks are carried out.
Anyone can call a meeting. The authority to call a meeting should be limited, as should the number of attendees.
Murky decision making. Decision making can be streamlined through the use of a standardised decision-making process.
Meeting time is free time. A clear agenda, advance preparation and attention to getting results on time can ensure maximum productivity at meetings.
Where did the time go? Time spent in meetings and on emails should be tracked and targeted to assess and improve productivity.