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Posts in Business

Remember to turn on the MTD function!

March 22nd, 2019 Posted by Business, Digital, HMRC, MTD, Quickbooks, VAT, xero 0 thoughts on “Remember to turn on the MTD function!”

Making Tax Digital (MTD) for VAT takes effect for VAT registered business with periods starting from 01 April 2019.  From this date, most businesses who are VAT registered and have taxable supplies above the £85,000 threshold (in any 12 month period) will have to submit VAT returns via MTD compliant means.

Many businesses who prepare their own VAT returns are choosing to do this using QuickBooks or Xero.  Just a quick note though… remember to turn on the MTD feature on your package!  Failure to do so will prevent your returns being properly submitted to HMRC.  Turn on should only be done when you are ready to submit your first MTD-compliant return – for most businesses this will be the quarter ending June, July or August 2019.

In Quickbooks this feature can be enabled by editing the VAT settings within the “taxes” section.

And in Xero MTD is enabled through the VAT return section, and clicking “new report available” in the top right hand corner, then selecting “try new report”.

 

Importing/exporting goods to/from EU from 29 March 2019

March 18th, 2019 Posted by Business, EU VAT, HMRC 0 thoughts on “Importing/exporting goods to/from EU from 29 March 2019”

If you are an UK-based business who imports/exports goods with the EU from 11pm on Friday 29 March 2019 your business will need to be issued an Economic Operator Registrations Identification number (EORI).

You should have received this letter from HMRC, detailing the steps you now need to take. It can take three days to process an application, therefore we suggest you apply now, if you have not already done so.

If the UK leaves the EU without a deal, or at the end of any transitional period, UK business will need to follow the same procedures that apply for trading with the rest of the world.

If you already have a customs agent or software for trading outside the EU, you’ll be able to use these to make declarations on your EU-UK trade.

If your only trade outside the UK is with the EU, you will need to apply for the Transitional Simplified Procedures (TSP) – an agent cannot do this for you.  TSPs are expected to last up to 18 months, and they allow businesses to defer making a full customs declaration and paying any duty due on import.

To register for TSP you must:

  • Have an EORI number
  • Be established in the UK
  • Be importing goods from the EU into the UK (including goods travelling through the EU from the rest of the world, providing they’ve cleared EU customs formalities)

 

Please note that the EORI number is only relevant for businesses who import and/or export goods as trade.  Businesses who only sell services outside of the UK are not required to obtain an EORI number.

As always, any queries, please don’t hesitate to get in touch with us.

Minimum Auto Enrolment Pension Contribution Increases

March 12th, 2019 Posted by Business, Employment, Jobs 0 thoughts on “Minimum Auto Enrolment Pension Contribution Increases”

AUTOMATIC ENROLMENT PENSIONS

MINIMUM CONTRIBUTION INCREASES FROM 6 APRIL 2019

With effect from 6 April 2019, the minimum automatic enrolment contributions are:

                              Employer minimum contribution 3%

                              Employee minimum contribution 5%*

*Employee contributions are effectively 4% after 20% tax relief.

As an employer, if you do not comply The Pensions Regulator will issue statutory notices, followed by penalty notices.  Deliberately failing to enrol eligible employees and knowingly including false information on your declarations are criminal offences.   For more detailed information on auto enrolment responsibilities and penalties go to The Pension Regulator.

As always, please contact us if you require more information.

Tax Free Benefits for Employees and Directors

February 11th, 2019 Posted by Accountancy, Business, Employment, HMRC, Jobs, Tax 0 thoughts on “Tax Free Benefits for Employees and Directors”
  • Interest free or low interest loans to the value of no more than £10,000 in the tax year
  • Relocation payments and expenses to the value of £8,000
  • Vouchers and gifts to the value of £50 (capped at £300 per annum for a director)
  • Staff entertaining, ie Christmas or summary party – up to £150 inc VAT a head
  • Up to £500 of independent pension advice
  • Employer’s contributions to an employee’s pension scheme
  • One health screening check-up and one health medical assessment
  • £4 a week for employees who regularly work from home
  • Long service awards for 20 years’ service of up £50 a year
  • Award schemes (ie staff suggestion scheme) generally exempt to a maximum of £5000
  • Provision of one mobile phone
  • Work related training
  • Onsite sports facilities/gym
  • Onsite parking facilities
  • Season ticket for a nearby public car park
  • Cycling safety equipment and storage (as long as the employee cycles to work)
  • Onsite childcare/nursery

The above list is not exhaustive, however these are the most common occurring items.  Often with the tax free benefits there are caveats attached to enable the benefit to be tax-free.  If you are unsure as to whether something is a taxable benefit or not, please get in touch and we can help guide you.

 

Changes to reporting income for SMEs and Individuals

July 7th, 2017 Posted by Accounts software, Business, Cloud accounting, MTD, Tax 0 thoughts on “Changes to reporting income for SMEs and Individuals”

I would urge you to spend just a few minutes reading this … I’ll do my best to keep this as short as possible, sticking to the key points …

Making Tax Digital (MTD) is a HMRC initiative which is due to come into effect from April 2018.  Essentially, all businesses (sole traders; partnerships; limited companies) and individuals who are required to submit Self Assessment Tax Returns with income over £10,000 per annum, will be required to submit details of their income and expenditure to HMRC on a quarterly basis, digitally, in a pre-prescribed format.

Businesses and individuals will inform HMRC of their income and expenditure for a three month period, and HMRC will calculate the tax payable.  This calculation will not take account of accounting and tax adjustments, this will be just a simple calculation of income less expenditure, which will need to be submitted within 30 days of each quarter.   Larger businesses and those who are VAT registered should not find this too onerous task, as these businesses will already be in the habit of collating information for tight deadlines.  However, smaller businesses and those who are, shall we say, a little less organised, need to get organised for Making Tax Digital coming into force.

I have heard some businesses saying “Oh, it doesn’t matter my accountant will take care of it” …. Yes, we shall where clients want us to deal with the additional filing, however …. or maybe “but” would be a more appropriate word, there are a couple of issues:

Firstly, as springs to most smaller business owner’s minds, what will the costs be for this extra work carried out by my accountant?   There will be additional fees where we are instructed to deal with the additional quarterly filing.  However, at the moment until we can see exactly what the requirements will be we are unable to confirm costs.  We generally anticipate though that the smaller the business, the lower the fees.

Secondly, and this is probably the factor of more concern, is the impact on cashflow once quarterly tax payments come into effect.   At some point, a date yet to be confirmed, tax payers will be expected to pay the tax payable each quarter (in real time).  Clearly, spreading the payment of tax throughout the year is a great idea – not having a large tax bill nine/ten months after a year end is a far improved process.    However, the information which will be submitted to HMRC will not take account of tax adjustments and therefore it is far more likely that tax will be overpaid throughout the year, and then refunded once the final year end accounts and tax returns are submitted.

There is also the effect on cashflow on the transitional year where we move from paying tax once or twice a year (depending on the business structure) to paying on a quarterly basis.  There will be a year where many are paying tax for the previous year (as we do currently) and also need to pay any tax due every three months, with that same year.

Quarterly reporting is due to take effect from April 2018 for businesses (sole traders and partnerships) and individuals who have income over the VAT threshold (£85,000).  Limited companies and those that are VAT registered will move over later.  Those with a turnover under £10,000 are exempt.  It may well be that in light of Brexit and other challenges that the Government has, that MTD going live is pushed back until 2019.   However, it has been made clear that this will go ahead at some stage.  The UK are basing their model on that of Sweden, which went live four years.  Much of Europe and the US already file quarterly tax returns.  The dates are yet to be confirmed as to when quarterly payments will take effect.

I hope that I don’t sound too negative about these changes … I am all for it … At Clarand we work digitally with our clients and we anticipate the transition should be smooth, however there will be some challenges ahead for some businesses and individuals in the transitional years.  I think the saying goes …. “By failing to prepare … you are preparing to fail”.  Clarand Accountants have already held a seminar about MTD for their clients, and will be holding more later in the year.

Claire Priestley

Three Years Old!

March 8th, 2016 Posted by Accountancy, Business 0 thoughts on “Three Years Old!”

We are celebrating Clarand’s third birthday this month, and what better way to do so than to sponsor and present at the Community Foundation Women’s Fund lunch on Friday 4 March 2016 in Newcastle Upon Tyne.  Over three hundred business women attended the event and over £18,000 raised on the day.  We have been delighted to be to involved in the event and it was great to share our journey so far.

Five Reasons to Consider Venture Capital Investments

August 11th, 2015 Posted by Accountancy, Business, Finance, Funding, Investment 0 thoughts on “Five Reasons to Consider Venture Capital Investments”

This guest post comes from Richard Charnley,  Investment Manager at Northstar Ventures.

Five Reasons to Consider Venture Capital Investments

Whether you’re a small business looking to expand or you’re a startup that needs seed funding, you might have considered seeking investment from a venture capital firm. Unlike traditional bank loans or private equity, venture capital can help support higher risk companies in the early stages of development. Here are five reasons why you should consider speaking to a VC Investment Manager if you are looking to grow your company.

  1. Expertise

There’s a saying that ‘it’s lonely at the top’. If you’re the Managing Director or CEO of a company sometimes it can be difficult knowing who to talk when you’re facing a big decision. This is why it can be helpful to have a VC Investor on your team: you can draw upon their experience with other startups and SMEs.

 

  1. Network

Venture capital often works through a string of networks, made up of investment firms, consultants, angel investors and of course the startups and SMEs themselves. By raising capital through a funding round you are likely to connect with a strong network of useful contacts. Whether it’s someone who can mentor you through the early stages of your business, or someone who can help raise funds in the future, the network VC investment can link you with can be invaluable.

 

  1. Flexibility

Venture Capitalists are experienced working with startups and small businesses. This means they understand that each business is different and a ‘one-size fits all’ approach (which you might find with a typical bank strategy) does not work. They are able to evaluate the business requirements and tailor a package that meets the needs, stage and exit route of the business and the management team.

 

 

  1. Growth

Venture capital typically has a stronger focus on growth when compared with other financing options. This can be particularly helpful for businesses in the early stages of trading who need to focus on quick growth in order to succeed. VC Investors may also accept initial losses for growth purposes – they can see the bigger picture.

 

 

  1. Cash

This is probably the most obvious reason people consider venture capital investment! Venture capital funds often have the ability to invest larger sums than might be available from a bank or on your credit cards. They also have the ability to fund the same business more than once, if the business has started to grow or is being scaled up.

It is worth noting that not all companies are right for VC investment and vice versa. VC investment is usually only suitable for companies where the management team and shareholders are focussed on the future sale of the business.

 

About Northstar Ventures

Northstar Ventures is a North East-based venture capital company that has been operating since 2004.

It is currently looking to invest from £50k to £0.5m in innovative high growth businesses and social enterprises across the North East region.

Online Accounts Software (Cloud accounting)

March 20th, 2015 Posted by Accountancy, Accounts software, Business, Cloud accounting, Digital 0 thoughts on “Online Accounts Software (Cloud accounting)”

With more and more of our clients turning to using online accounts software to help support them with their day to day finances, we thought we’d share some of the benefits that our clients have reaped from going digital …..

  • Real-time accounting
  • Easy access by their accountant throughout the year
  • Access whilst on the go
  • Saving time
  • Reducing costs
  • Helping with forecasting/planning
  • Going paper-free
  • No year-end surprises
  • Monthly fees; no upgrade costs and no contracts
  • Secure and no backups

There is now a vast choice of user-friendly online accounts packages for all size of venture and business and there are just  a few detailed below, including Exact Online; Xero; Quickbooks Online; Freeagent; Clearbooks; and SageOne.

 

                  Exact Online

 

Many features being …..

  • Live bank feeds (no need to input statements manually)
  • Easy to use
  • Smart phone and tablet apps
  • Document management/storage
  • Take photographs of receipts/documents
  • “Bolt on” packages and apps with additional functionality ie Receipt Bank; Shopify
  • Integration with HMRC (ie easy filing of VAT returns)
  • Client relation management system
  • Monthly fees; no upgrade costs and no contracts
  • Secure and no backups

Most have free trials/demos so take a look and see what’s out there and how it could work for you.  Any queries please contact us as we can help you ….

Supply digital products to the EU? This will effect you!

January 13th, 2015 Posted by Business, Digital, EU VAT, HMRC, MOSS, VAT 0 thoughts on “Supply digital products to the EU? This will effect you!”

With effect from 1 January 2015 the EU has brought in a new EU VAT scheme which directly affects UK businesses making digital supplies to customers in the EU.

Essentially the change is to “the place of supply”. Up until the end of 2014 the place of supply was where the supplier is based – ie here in the UK. If you are VAT registered you would charge UK VAT on your supply, and if you are not VAT registered you wouldn’t charge VAT. However, now the “place of supply” is where your customer is based.

Example:
On 1 January 2015 you sell a download of your latest album to a customer in Germany. You now need to charge German VAT on that product!

You have two choices:-
1. Register for VAT in Germany – which, aside from the language barrier, will be an administrative nightmare; or
2. Use the EU VAT MOSS – “mini one stop shop”. This means you declare the VAT charged (at UK rate of 20%) and pay it over for all of your EU sales. This way you avoid registering in each individual country.

If you are not currently VAT registered you will need to register for VAT to be able to use the VAT MOSS scheme. You can register via HMRC website. However, this does not mean that you need to charge VAT on your UK sales going forward (unless over the UK sales threshold). You do need to go through the VAT registration process, include your VAT registration on any invoices to the EU, submit quarterly returns to HMRC, and pay over the VAT in relation to EU digital sales. Payment can be made via HMRC website.


FAQs

My UK sales are lower than the current VAT threshold of £81,000 therefore I won’t have to register will I?
You will have to still register for VAT via MOSS. The UK VAT threshold is based on UK sales only. The EU has not sent a de minimis amount. Therefore, if your sales are £1,000 you need to still register for VAT via MOSS. However, you do not declare your UK sales on the VAT return, just those digital sales to EU countries.

When I complete the form on HMRC website it is asking me what my UK sales are – they are below the threshold and I am not sure what to include. Help?
You need to include £0.00 in the UK sales box.

How do I know where my customer is located?
You can use your customer’s postal address or bank sort code. If you search a bank sort code on the internet it will bring up the branch details. You also need to retain this information for your records for the next ten years.

If I register for MOSS can I now claim my VAT on expenses back?

You cannot claim VAT back on UK purchases, however you can claim VAT back on any EU purchases which are wholly attributable or can be part apportioned to the EU digital sales.

If I register for MOSS and then decide that I am no longer going to supply to EU customers – how do I stop reporting to HMRC?
You need to de-register from MOSS. You need to tell HMRC at least 15 days before the end of the VAT quarter in which you intend to stop using the scheme.

This is the link to HMRC’s website where you can register for MOSS and find out more about it:
//www.gov.uk/register-and-use-the-vat-mini-one-stop-shop
We hope that this helps gives some guidance to what can be quite a complicated area.  Please drop us a line or give us a call if you want to discuss this further.

Being Human

March 11th, 2014 Posted by Business, Marketing 0 thoughts on “Being Human”

So what do you need to do to have a successful business?

Well I’m not going to compile the whole list. As I’m managing a small business myself it would probably make me panic a little. I’ll stick with what I know best, marketing.  How do you market your services or products with as little resources, (time and money) for maximum return?

Think human.

That’s it. Thanks for reading.

… ok, I’ll expand on that a little.

The products or services you are selling are for humans. You want humans to buy them and use them, talk about them, get their friends (again more humans) to buy them, then return for either more of the same or for other lines or services.  So what you need to do is develop your business around human needs and wants. Even if you are selling B2B, it’s still you (a human) communicating with a real live person in the business.

Here are some suggestions on Human 2 Human (H2H) marketing:

Cut down on the jargon. If you are communicating with people about you or your business they need to be able to read it, watch it, or listen to it without having to try and figure out exactly what you’re trying to get across.

Be real and authentic and keep to your values. Pick three or four words that describe your business personality. Is it honest, fun, passionate, traditional, professional, reliable, ethical or confidential etc? Think about what it is that makes your business special and use those values in your communications.

Talk to the humans, they’re real. This is the thing about social media and where some people are still getting it wrong. You are having relationships with real people so show that you’re living and breathing too. There’s a person at the keyboard who perhaps had to get up too early this morning, is thinking about what sandwich to have and would appreciate you sharing or retweeting their content. Be nice and be real. Think before you tweet too, thoughtless tweeting is not going to do to you any favours.

What makes them tick? Think about what it is that they need from you or your business. Do they want to improve on what they’re doing? Is this all new to them and they need support? Have they been disappointed with other companies? Do they need to excel and be strides ahead of their competitors, or do they just want wonderful service? Think. What is your message, what can you offer that’ll make them either feel smart or valued or will make their lives better.

So, all your need is: the right product or service; at the right price; at the right time or location; and a good amount of people who are willing to buy it. Then tell people about it in the right way and deliver it (with a smile). Good luck with that!

By Karen Marshall of Canny Marshall  www.cannymarshall.com or follow me on twitter @cannymarshall

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