What are Statutory Accounts

UK Statutory Accounts

As necessitated by the Companies House and the HMRC, all limited companies registered in the UK are required to arrange financial accounts to be submitted annually by their ARD, or accounting reference date. The ARD is the ending date of the 12-month financial year for the limited company. The HMRC uses the annual accounts to determine the company must pay in Corporation tax in relation to their taxable profits. What are Statutory Accounts? A statutory account is a series required accounting documentation that is submitted yearly for the purpose of corporate taxation by the HMRC. Furthermore, it is often used to confer to shareholders the health and profitability of the company, or indeed, lack thereof. A statutory account is comprised of a number of elements including a balance sheet, a profit and loss ledger, a cashflow statements, notes, and a director’s report. Below, we go into a bit more depth regarding each of these elements.

The Difference Between Management and Statutory Accounts To the unfamiliar eye, management and statutory accounts may conflate. The primary and most important difference is that Statutory accounts (as indicated by its name) are mandatory. Management accounts, while useful and a key aspect of running a well-maintained and profitable business, can be used (or not) in any way one sees fit. Statutory accounts, on the other hand statutory accounts must conform to strict guidelines set forth by the relevant authorities.

This being the case, statutory accounts are follow a generalised template which make it easier for both shareholders and the HMRC to understand. These statutory accounts are not particularly useful for internal use within the company as they are produced for the purpose of general understanding of financial standings by third parties (as opposed to problem driven, detailed internal measurements of a management account). Another typical difference between management accounts and statutory accounts is frequency of which they are produced. A once a year statutory account is typically not enough for a director or management team to glean insights into the ongoing financial health of a company. Management accounts are typically created quarterly or sometimes monthly, depending on the size of the company. Management accounts allow you to adjust the current inner workings of the company and plan strategies for future financial success.

how to prepare statutory accountsUK Statutory accounts

Components of a Statutory Account As mentioned previously, a statutory account must contain all information required by the HMRC. Firstly, basic company information must be detailed. This basic information is relayed in the Cover Page, Contents Page, and Company Information page, before the separate accounts sections. 1) The cover page includes the name of the company, registration number, and the company’s year-end date 2) The contents page, as the name implies lists the section and page numbers of the separate sections of the statutory reports 3) The company information page will list the directors, accountant, lawyers, bankers and registered of the company. Once these formalities are taken care of, the following accounting documentation should be included. Balance sheet- A balance sheet is a ledger that indicates all of a company’s assets and debts up until the last day of the fiscal year. The balance sheet must have the name and signature of the director in order to be accepted. Profit and Loss Account-

 

The profit and loss account, in the simplest terms, expresses profits by deducting costs all revenue for the financial year. It is often subdivided into categories such as revenue my category or expenses for travel (for example) for easy analysis. The number at the very bottom is the most important, indicated net profit for the year. This is typically the earnings before interest, tax, depreciation and amortization (often shortened to the acronym EBITDA). Cashflow Statement- As indicated by its name, a cashflow statement is indented to document the flow of money into and out of a company. This can include returns on investment, money from operating activities, taxes, capital spending, and dividends. Notes- Notes may accompany many of the figures in the various accounting documents. The notes are intended to provide context to the otherwise static numbers. Director’s Report- The Director’s Report is the director’s opportunity to address management and shareholders and explain the numbers included in the Statutory Accounts. The director may take the opportunity to reflect on successes, shortcomings, and layout the vision for the upcoming financial year. Small, Dormant, and Micro-Sized Companies’ Account Exemptions Though all companies are required to file statutory accounts as a component of the Company tax return, the size and type of your company may offer some exceptions. For small companies with a turnover of less than £10.2 million, less than 50 employees, or £5.1 million or less on their balance sheet, an abbreviate version of the accounts can be filed to Companies House.

Micro entity accounts template

These abbreviated statutory accounts are comprised of only the balance sheet accompanied by notes. The directors report is optional and an exemption can be filed to prevent the auditing of company accounts. If the company has a turnover of less than £632,000, £316,000 or less on its balance sheet, or fewer than 10 workers, it qualifies as a micro-entity. Micro-entities are able to prepare even simpler accounts, send only balance sheets with even less information, and benefit from the same exceptions as small businesses. Dormant companies also qualify for exceptions. A company is considered dormant if it has not completed any significant transactions during the financial year, not including filing fees paid to Companies House, fees resulting from penalties incurred for late filing, or money paid for shares during the incorporation of the company.

If the company is both dormant and small, only abbreviated accounts need to be filed and accounts are not required to be audited. Limited company accounts template and statutory Accounts Example Using the internet, it is possible to find pre-made accounting templates to assist with the creation of your Statutory Accounts. One free and useful site can be found here. A comprehensive example of how a well drafted statutory account filing should look like can be found here. Limited Company Accountants for Small Business Although the process is generalised, filing annual accounts for a limited company can be time consuming and costly. Many companies opt to utilize the services of limited company accountants to ease the process. For a small fee, a qualified specialist can aid your limited company with comprehensive knowledge of accounts processes. This also shields you and your company from costly common mistakes that may cost you in both precious time and avoidable fees.

How to Open a Limited Company Bank Account

How to Open a Limited Company Bank Account

Why a Limited Company Account?

Though it is not mandatory to open a separate limited company bank account for your organization, it makes the bank transactions a lot easier in the long run. Using a different business account allows you to distinguish personal finances from the company’s. Otherwise, different problems may arise. For example, since having company money in your account is taken as borrowing from the company, the account will be in credit; this can cause increased tax liabilities. It may even be illegal to borrow money from the company. Certain tax benefits intended for businesses may not be provided for such accounts as it may be said that the money (and the charges paid for it) is not in the company’s name. Another potential hazard may occur if the company becomes insolvent and had an overdraft that could fall onto the shoulders of the person whose account is being used.

Steps to Opening a Business Account

• Let’s start at the very beginning and assume that you are thinking of creating a limited company. The first step would be to open the company.

• Next, you will have to get the Certificate of Incorporation, which is a license granted by the government and allows you to form the organization officially. This certificate is issued after the company is active and may take a while to obtain.

• Select a bank where you will open the limited company account and book a meeting with them.

• The meeting requires you to show documentation proving your identity and address, where you have to fulfill the bank’s requirements in order to be able to open the account.

 

Bank Requirements

Banks will ask you to provide the following documents: (Note that people applying from other countries to the UK will have to give notarized translations of their national ID, and other documents)

• Passport, national ID, or a driver’s license with photo – this proves identity and will be required of all the named company directors

• A recent bank statement, council tax statement, or a recent utility bill – this provides proof of address

• Company details such as the complete business address (with postcode), contact details, Companies House registration number, and estimated annual turnover are needed

• Personal financial documents may be asked for as proof of clean credit and banking history (Un-discharged, bankrupt, or disqualified directors cannot open a limited company account)

Which Bank?

Though you may prefer to stick to the bank you are already using, you should consider several before you go ahead. You can try the Big Four that dominates UK – HSBC, Barclays, Lloyds, and the Royal Bank of Scotland. Look carefully at the fine print and, before choosing, take into account the following factors:

• Banking fees and charges

• Competitiveness of interest rates

• Availability of mobile or telephone banking services

• Availability of online banking services

• Incentive offerings


An overwhelming majority of UK businesses fall into the small and medium enterprise category (SME), i.e. they employ less than 250 people. If you’re thinking of joining them, you should open a limited company bank account. Not only is it similar to opening a personal account, it will help you, and the company, avoid the pitfalls of mingling business and personal finances. Also, choose the bank that works best for you.

GM Professional Accountants are small business accountants in London and Essex

Call us now on 0208 396 6128 for a free consultation.

How to find accountants in Ilford Lane

Searching for accountants in Ilford lane

Run your business in a lucrative and hassle-free way by hiring the accountants from GM professional accountantsAccountants in Ilford

Are you wondering, “How can I find skilled accountants in Ilford near me?”  GM professional accountants is near you. Yes, ours is a leading Accountancy firm in Ilford, London. Since the start of our firm, we have been offering individualised service to local businesses of all sizes. This means that if you are the owner of a small business, you can also get our professional services at the best prices and find expert accountants near Ilford lane.

Why does choosing our Accountancy firm your best option?

Finding small business accountants in your area is not all a difficult task. They are always available to offer you a variety of services, including accounting and tax return services. Our skilled accountants will make sure that you will get a quality, competent service at a competitive price. GM professional accountants is always ready to advise you for the growth of your business.

You can completely count on our professional accounting services. This is because we have vast expertise, as well as experience in the Bookkeeping and Tax industry. At GM professional accountants, we focus on your business accounts as well as on offering you a practical solution to aid you as well as your businesses and we specialise in capital gains tax.

Our firm has a well-organized team of highly qualified tax accountants near Ilford. All of them have vast years of combined experience in the industry. They will suitably advise you on the way to make your business accounts keep simple. They have the required skills to cut your tax bills. Thus, you can rest guaranteed that you could save a considerable amount of dollars during your tax return. This will allow you to save your hard-earned money as well as your time.

At our firm, all our qualified accountants near Ilford are well versed in accounts practices as well as in tax laws. They will steer you in the right way to develop your business. They will also suggest you the ways to improve profitability, growth rate, cash flow, as well as to boost your business value. Thus, you can rest be confident that you could develop your business effectively.

Furthermore, we can assist your business to develop at a fast pace by practically offering suitable tax suggestion in a timely way. We are the only service providers in Ilford, offering all sorts of tax-associated services. Our knowledgeable accountants will offer you a tailored service, which you cannot find anywhere in the Ilford area.

Our variety of accounting services

As one of the leading accountants in Ilford, we will do our level best to incorporate our expertise and experience for the welfare of your business. Our courteous, professional accountants will do their best to aid you greatly in saving your time as well as your cash through their hands-on business suggestion. We can assist you in finding the easiest way to reduce the overheads and costs. This, in turn, will allow you to charge your valuable customers less. It will also allow you to compete capably with your business competitors.

 

If you need any additional Accounting services, pertained to your business, feel free to contact GM professional accountants. As we are always available to help you, you can contact us on 0208 396 6128

How to save tax on Property in the UK and Capital Gains Tax

Property in the UK and Capital Gains Tax

Capital gains tax (CGT) by definition refers to the tax levied on any gains accrued as a sale of any asset. The assets include but not limited to, inheritance, certain gifts, shares, heirloom, sale of business owing to the dissolution of a civil partnership or divorce transfer or even a second property. In this article, we shall focus on the CGT from the perspective of residential property.

CGT – Some preambles:

The CGT levied depends both on the gains from the asset and your income. However, the capital gains below a cut-off limit are exempt from CGT, the current cut-off is positioned at £ 11, 100 or lower per year. The gain is calculated by a simple formula of subtracting the original purchase price of the asset from the Sale price.capital gains tax on property

CGT for Expats:

Our property accountants on capital gains tax have highlighted that Prior to April 6, 2015, British expats and overseas investors were exempt from the CGT in the case of sale of a residential property. However, with a new rule coming into effect, this exemption stands withdrawn. Moreover, this was considered as a loophole in the British taxation system. Overseas investors and British expats were known to have a penchant for investing in buy-to-let properties and generating snug incomes out of the investment.

The new rule implies that any gains made by selling a property in UK post April 6, 2015 may incur a CGT in tune of 28% of the accrued gain. The rate of 28% of the gain is chargeable in case the gain and the income tax are above the minimum cut-off. In case you fall in the category which is below the minimum. GM professional accountants provide expert advice on capital gains tax on uk property.

cut-off, the CGT would be levied on you at the rate of 18%.

CGT on assets acquired through Inheritance:

There are a different set of rules for UK domiciles and non–domicile as far as the Capital Gain Tax on inheritance is concerned. By definition, a person who out of the last 20 years has lived in the UK for a minimum of 17 tax years qualifies to be called a UK domicile.

Inheritance below a cut-off value is exempt from the CGT. Only inheritance evaluated at more than £ 325, 000 or higher attracts CGT. However, to calculate CGT, this cut off amount of £ 325, 000 is deducted from the total evaluated value of the inheritance. Any amount over and above this minimum threshold attracts a CGT at the rate of 40%. Evaluation of the inheritance is inclusive of all the assets (including the assets that are held in trusts), including but not limited to, money, property(ies), any gifts that were given during the period of seven years prior to the death; gifts to trusts or companies over the lifetime (some exceptions are applicable to this particular category).

A non-domicile pays the Capital Gains tax on the assets situated on the UK soil only, in contrast, the domiciles are liable to pay CGT on all assets acquired through inheritance, they may be anywhere in the world.

Private Residence relief and letting relief:

– Private residence relief (PRR): This relief is applicable on the sale of property that has been your principal private residence. In other words, you occupied that property as your own residence. There are a few qualifying conditions for claiming the PRR, starting with the condition that the house was not bought for the purpose of making gains. The house was used as a primary family residence for a stipulated duration during ownership. Inclusive of everything the total area of the house if below 5000 square meters. No part of the house was used for Business or part of the house was sub-let (single lodgers are exempt).

– Letting relief: This relief on Capital Gains Tax is applicable in the case of a property that you used as your private residence for a period of time and then you let it out to someone else at the applicable commercial rate. The foremost requirement whilst claiming the private residence relief is that the onus to prove that you actually lived in that particular house is solely on you. Some investors of buy-to-let category of properties in their quest to prove that the particular house in question was used by them as a private residence, try to adopt dubious means; a practice that shall be avoided at all costs. There exists a list of questionnaire that allows you to prove that the let-out property was also your private residence for a period of time.

UK laws allow you to claim both the private residence relief and letting relief.

Calculating Private Residence Relief and Letting relief:

There is a very simple formula for calculating the PRR. The calculation is done using:

PRR = Total Gain X (period of occupancy / Total period of ownership)

The period of occupancy is calculated by adding 18 months to the time you have actually lived in the house.

 

The letting relief is capped at a maximum of £ 40, 000.

Call our capital gains tax helpline now on 0208 396 6128

 

 

 

Top 3 tips from Limited company accountants

Top 3 tips from Limited company accountants

Making a good profit is one of the biggest motivators for any business owner. Yes, there are various reasons for why people start their own businesses. Money isn’t the only factor, but it is an important factor nonetheless. So imagine this – you have set everything up and it’s going great. You are driving in more and more sales as the days go by, and the earnings graph is through the roof. Now the next and very important thing that you need to consider is income tax. Taxes are an inevitable part of learning. We all have to pay them. It is common knowledge that there is a slab on the amount of tax you pay depending on how much you earn in a year, apart from other factors like the nature of your business/profession, your gender, age, etc. Nobody is ever taxed more than what they are supposed to pay as per the prevailing rules.

What if someone told you that there are ways in which you can legitimately minimise the amount of tax that your business pays by investing or diverting it elsewhere? That would mean less tax paid and more money used to push your business forward. So here are the top 3 tips from small and limited company accountants on saving income tax. Salaries to Director and Family Members Director’s salary is one of the most common tax saving methods employed by businesses.

Limited company accountants

It is common knowledge that the director takes a certain portion of the profits at an agreed ratio. Showing this amount as salary, even up to the exempt amount, can help save tax on the same. The same goes for salaries to family members. Most businesses start off with the family members helping out or joining in at key positions. The profits that are paid to them should be shown as their salary for gaining tax benefits on the same. Vehicle Usage Using a company vehicle for private purposes attracts tax under Class 1A National Insurance, which will have to be paid for by the user of the car. On the contrary, using a private car for official purposes helps in getting a tax exemption and furthermore, allows the user to claim certain benefits depending on the extent of the car’s use.

Capital Assets and Capital Allowances on capitalising assets and depreciating them over their useful life offers some tax exemptions on the same. Assets are capitalised instead of being recorded as expenses because they offer some benefit to the company over a period of time. Recording items such as electronics, machinery, furniture, etc. as fixed assets and depreciating their value at a fixed rate every year gives the company long-term tax benefits. There are many ways for you to legitimately reduce the amount of tax that you pay on your business income. It is always a good idea to consult your own accountants or any accounting firm to understand the smaller details so that you can take better decisions. Your accountants will be the best person to advise you on to pay your taxes.

GM professional accountants are local accountants based in London

How Brexit is affecting businesses

How Brexit is affecting businesses

On June 29, 2016, the United Kingdom (UK) voted to leave the European Union (EU). Since then David Cameron resigned as Prime Minister and Theresa May has replaced him. The value of the pound has “dropped twelve percent”, however the “FTSE 100 Index has gone up 17 percent”. (The New York Times). On March 29, 2017, Theresa May invoked Article 50 to start the process of the UK leaving the EU. Since invoking Article 50 the UK will have two years to reach an agreement with the EU on how both parties want to handle trade and the movement of people between countries in the EU and the UK. If no agreement is reached in two years then trade rules set by the World Trade Organization will go into effect which would allow for the UK to impose greater or possible unequal tariffs. This would mean the price of goods and labor that are imported and those that the UK exports would increase.Accountants near me

One of the reasons that UK citizens voted for Brexit was because they want to see a decrease in immigration.  Since the EU allows easy passage between member countries, some fear that it is too easy to enter a country and cause harm. Once one gains citizenship in a country one can easily move between countries without many obstacles, however different countries have different requirements and security checks for becoming a citizen. Easy passage between countries can be beneficial to countries as well; many citizens of EU countries come to work in the UK. These people work in a number of different jobs from farming to finance across the UK. With the UK leaving the EU, many are unsure what will happen to these workers and some have already started to leave the UK. “Official figures reveal that the number of EU-born workers in the UK fell by 50,000 between October and December to 2.3 million” (Kollewe). With people leaving, businesses will have to find a way to make up for this lack of labor. Some businesses have started to move jobs to EU member countries while another option would be for businesses to raise labor rates for jobs that UK citizens have not been willing to do for lower rates.

Increased labor rates is not the only effect of the UK leaving the EU. Depending on the outcome of the upcoming negotiations a multitude of things could happen. Since the UK is the first to exercise article 50, no one knows how this will affect other member countries. If the UK gets a favorable deal other countries may also consider leaving to see if they can get the benefits of the EU without paying into the system. However, if the UK gets a bad deal it could discourage countries from leaving in the future. Another possible effect would be Scotland leaving the UK to join the EU. Since the majority of the Scottish population voted to stay in the EU, some have considered leaving the UK and joining the EU to stay in the single market system. This separation would further decrease the UK’s workforce and hurt their economy.

 

Written By Gm professional accountants, Local Accountants based in london

How to find accountants near me using reviews

Accountants near me reviews

If you need to hire an accountant near you, your best way to find an experienced, skilled and trustworthy professional is using online reviews on Google and Yell. While everyone is familiar with making a local search for on Google or searching for reviews, using Yell to find accountants might be something of a novelty for you.

Use Yell.com business directory

Yell.com is an online service in the UK that lists local businesses. Searching on Yell.com is a simple and quick way to find a local accounting professional. This business directory is divided on various categories. So, in order to filter your search category, you need to first search for “accountants”.

By entering what you are looking for, the business directory will retrieve listing results from the proper classification. Then, you can take your search one step further by making your search local. Yell will show local matches in the order of your proximity to your location. The business directory aims to always provide the most relevant local results. Check online ratings, testimonials and reviews
Accountants near me reviews
In order to select one of the local accounting firms or professionals for your payroll services or tax return, one of the first things to check is their rating among the former clients. Check feedback and reviews in order to evaluate their online reputation.

Read the online testimonials and reviews in detail. If the majority of the online reviews of an accountant or accounting firm are generally positive, this is a good indication that their clients are content with the exceptional services provided. On the other side, if the majority of online reviews are negative, this is a sign that the services provided by the accounting professional or the accounting firm to their clients are not adequate.

You should also read the testimonials from the past clients, apart from online reviews. The quality of the services provided is well reflected in these client testimonials. You can find testimonials on the website of the accounting professional or accounting firm.

You may even ask the accountant you consider hiring to provide a list of previous clients. Then, you can randomly call up some of these clients in order to request them information about the service quality of the accountant.

Getting referrals is another recommended method to ensure you’ll receive high quality accounting service. You can get these referrals from professional associations or from friends. When an accountant firm has been referred to you, they will feel a double obligation to do their job well.

You can trust GM professional accountants

One of the accounting firms with solid reputation is GM professional accountants. This local firm in the South East is providing a complete range of services that cater to small to medium sized limited companies, partnerships and self employed individuals. They offer a pro-active and prompt service that provides good value for your money.

GM professional accountants is practicing a fixed fee that depends on the size of your business. The fee is fixed for the first 2 years of providing you accounting service and agreed in advance. You can even arrange paying in monthly installments. Among the services provided are included accounting, book keeping, payrolls, tax planning and compliance, VAT returns, self assessment tax returns, forecasting and business planning.

benefits of outsourcing payroll services in London

Outsourcing payroll services in London

benefits of outsourcing payroll services in London to compute salary, wages, compensations and other benefits can help your productivity and efficiency of your organization. Well compensated labor induces workers to work more innovatively, productively and competently for their organizations. Most multi-national companies and corporate ventures outsource their payroll requirements from outside payroll specialists.

Outsourcing payroll services in London

Some companies assign local accounting firms to administrate their payroll departments while others will choose foreign or offshore payroll service providers. However, majority of management officers prefer to local accounting firms for payroll services due to great accessibility and practicality. Anyway, you can minimize the administrative costs if you outsource payroll services from outside payroll specialists. As outsourcing payroll services from outside company demand very cheap cost, big companies can benefit a lot. For small or medium business ventures, they can save significant time and money in the financial and payroll chores. Beyond all, outsourcing payroll operations help managers to concentrate on other administrative functions.

benefits of outsourcing payroll services in London
Payroll service companies update the payroll system on a regular basis. They are complying with restructured rules and regulations on payroll and taxation system. Private payroll service providers ensure updated payroll systems and upgraded payroll software which enable on time contribution of salary to employees. Payroll service providers complete all the payroll operations within a specific time frame. They do calculate gross salary from work performance by withholding the deductibles from gross salary and filing and sending tax documents to the related government agencies. With private payroll service providers, you will be able to provide salary and bonus to employees in a stringent timetable. Consequently, the relationship between the employer and employee will be enhanced.

Payroll providers in London

This article is going to explain about payroll service and its need in today’s time. It is understood as the amount of money that is to be spent by the firm for paying the wages to employees on monthly basis. Big firms are blessed with their own in-house payroll department that is responsible for making complicated and also time-consuming payroll calculations for every employee. Meanwhile, small and also medium size organizations generally don’t make any investment in setting up another department but also assign duties to the administration department.

The lack of expertise and knowledge in making fully complicated calculations that are actually compliant with the latest payroll tax laws lead to errors. services are introduced with the main aim to eliminate errors occurred due to human involvement. In these services, calculations are generally performed with the help of automated payroll software, in order to deliver fully accurate and timely results. The reason is simple every employee waits for his/her salary and incentives and also desires to get paid on time. Moreover, inability to pay timely is something that can also make an adverse impact on the reputation of any organization.

Therefore, those of small and mid-sized businesses are generally hiring payroll services, in order to relieve themselves from all stresses relating to payroll. There are numbers of such service providers so finding them is certainly not a big challenge. In order to hire best payroll services in London, you can explore some best service provider and gather their history, record of accomplishment, client testimonials and more to analyze their past performances. It will definitely help you in making a perfect selection and you can enjoy the best services.

Once you hire such services, you must be sure of the complete accuracy of payroll and payroll taxes. Even if the firm gets any notice by the concerned department, the notice is then actually sent to the service provider mainly to tackle directly with the concerned department. It generally ensures that such firms are highly efficient in performing such calculations and also are highly responsible for any kind of notices due to late payment or also inaccurate tax payment.

GM Professional Accountants are specialists and is the best choice if you are actually keen to save your valuable time and also seek to stay away from difficulties involved with payroll process, you can certainly rely on a highly reputed payroll service provider. This will certainly not assist you to ignore errors but also help you in keeping your administrative department and employees highly satisfied.

Best payroll providers

With so many different types of payroll services, however, it may not be an easy task to find one that is perfectly suited to your business needs. In this article, we will give you tip on which questions to ask yourself as well as your prospective payroll service provider so that you can make an informed decision.

With so many payroll service providers on the market, when choosing a service to meet the requirements of your business and its employees it is important to ascertain whether the service can offer you what you need.

After signing your contract agreement with the payroll service you should have immediate access to the system so that you can set up your account, add your employee details and so on. Also, make sure that you will be able to access and run your payroll from your mobile device.

You need to be absolutely certain that all sensitive and private payroll data won’t fall into the wrong hands. Before you sign on the dotted line, ascertain whether the payroll service uses data encryption technology to protect identity numbers, passwords and other sensitive information from theft. Most payroll services use the same encryption protocols as banks.

That’s why GM Professional Accountants is the best choice as your business grows and your workforce expands, your payroll service should be able to accommodate that growth by providing the option to add extra employees as well as additional users to the account.

Payroll providers for a small business

Business process outsourcing is a way of easy task management available to big and small companies whereby the business owners utilizes the technical expertise of service providers all over the world to perform a task or job that was once undertaken by the business itself. Business process outsourcing is basically shifting a job to an external company that might have a completely different address or location.

Business process outsourcing services always have been in a win-win situation for both parties in the deal. Businesses can utilize their services for development activities and can expect higher profits as operational costs are down. Business Process Outsourcing Services are growing as time goes by. Earlier, jobs like only payroll processing were outsourced. With time and technical advancements, tasks like cataloging, indexing, and media analysis were included. When we talk about business process outsourcing, one name that instantly comes to our mind is a virtual administrative assistant.

In today’s stiff competition, Outsourcing Data Entry helps global business organizations to maintain uptime and to be competitively effective. Everyone starting from industries to individuals, professional to retailers all look forward to outsource their back office work to ease the work load at affordable rates.

Outsourcing data entry also has some major benefits that include access of specialized service, fast delivery, increased customer satisfaction and advantage of low cost services. Thus, why GM Professional Accountants is the best choice by outsourcing your work, you can easily reduce tons of time-consuming work and focus on major issues.

GM Professional Accountants  are small business accountants based in London

How to Find an Accountant in Your Area

Top 3 Tips on How to Find an Accountant in Your Area

 

Finding an Accountant in your area can be stressful, nowadays the pace of our lives is so fast that we cannot manage to do a number of common everyday activities ourselves, not to even speak about getting the work concerning accounting and taxes done. The result of this current state of affairs turns out to be that more or less everybody needs someone to take care of their tax business – a personal accountant.

 

Before starting your search…

 

First of all, make sure to know what you want and what you need to be done. Otherwise you might end up paying for the additional services that were not necessary in the first place.

Tax preparation services in London

Before even starting the search, one has to be aware that not every self-proclaimed tax-expert is actually a professional. In the UK, not everyone who call themselves an accountant has been certified by some of the country’s legal bodies. Titles that people assign to themselves may often be misleading. Make sure to check the background of a person whom you consider employing for the task. Check their skills and qualifications, preferably the previous experience too. Only once you are sure that the person is reliable, the process may continue. Two of the most common ways of finding accountans are friends’/colleagues’ suggestions and, of course, our ever-helping Google.

 

Finding the right accountant

 

 

1) If you have an accountant recommended to you by a person you trust, that is already one concern less for you. You know where your money goes and you know that the service concerning your taxes will be done with the desired quality and efficiency.

 

2) Internet browsing is on the other hand a bit more risky. Usually, online services cost way less than the services of those high street accountants. But we should remember that the quality (mostly, but not always) goes hand in hand with price. The above mentioned “problem” of wannabe accountants should be kept in mind at all times, since taxes are not something to joke with. We give you the highest-rated site on which you can find the accountants in Barking, according to the reviews of the clients and customers on Google: https://www.yell.com/s/accountants-barking-essex.html

 

3) Whichever of the above mentioned options you choose, prior to making the actual appointment with the best accountant, you should consult with several different accountancy firms or individuals. The reason for this are first and the foremost your finances. You do not want to pay more for a service that you can get done with the same efficiency for a lower price by someone else. Furthermore, get familiar with the payment methods each firm requires and the policy of the company as well. You will spare yourself the possible regret later. In addition to that, it is always better to have a variety of options, so that you can choose the one that is the most convenient for you and your needs.

 

Beware of frauds!

 

Just like any other activity, the accounting business is full of cheaters. Many of those titled as “accountants”, online or offline, have nothing to do with this area, they just drag you into paying the certain amount of money onto their bank accounts and after that you never hear from them again. When it comes to the payment part, be extremely careful and do business only with the ones whose backgrounds you are absolutely sure of.

 

Property taxes highest in the world

Property Tax in the UK


Property tax in the UK is highest in the world. Whether you have an own property where you are currently staying or got it is as a gift, or even passed on due to inheritance, you have to pay some or other kind of tax for keeping it in your possession. The value is so much that it contributes almost 37 percent of the total GDP of the United Kingdom. While most of the people express their discomfort at parting with such a high amount, the system continues. There are quite a few contributing factors for the exorbitant amount of tax rate. Let us look into some of the taxes that the landlords, real estate agents, and the owners have to pay to keep the property in their name.

There are basically three types of tax head that require being paid, namely Central Government tax, Developed National Government tax and the Local Government tax. These are then sub-divided into various categories. Some are direct taxes and others are an indirect tax. These can be paid on a monthly or on a yearly basis. The total property tax contributes more than 10 percent of the total tax collected as per Organization for Economic Co-operation and Development.

uk property taxes

The property tax is levied on the property owner, landlord and the real estate. Anybody with a recurring income from any of his properties as a rental is liable to pay the taxes. The tax liable to be paid is calculated according to the property type. If someone rents more than one property, every property will be treated as individual property and the amount will be calculated accordingly. The tax is applicable to the government treat the rental as an income source and levies income tax on them. It is calculated on the basis of total profit incurred by the individual after paying off the yearly maintenance. For anyone who is a non-resident of UK but owns a property and provides it for rental, the rules are different.

Another type of tax named as Capital Gain Tax is then levied and is calculated differently. This can be up to 18, or 28 per cent according to the income bracket. This tax is paid annually. The non-residents are generally not liable to pay this tax but are liable if the property is used for professional rentals.

One of the most complex taxes that have to be paid for any real estate owner or landlord is Inheritance Tax, which makes the next successor according to the official will as its owner. Not paying could lead to a tax burden on the subsequent owner. The other types of taxes that need to be paid are in the form of stamp duty. There are various slabs which tabulate the general tax rates and the liability of any individual against buying, selling or inherit different properties in the different region.

GM professional accountants are local London based Accountants

How to choose the best Tax Advisor in London

Best Tax advisor in London

When getting your tax done, you want to make sure you get it done right. It’s often a hard and confusing process, but don’t worry, we’re going to take your hand and take you through step by step. If you’re looking for one of the best Tax Advisors in London, you’re at the right place!

What To Look For In A Good Tax Advisor

When it comes to looking for a good tax advisor at GM PROFESSIONAL ACCOUNTANTS, it can be very hard. Not to mention, very expensive. When it comes to looking for a good tax advisor, you need to take a few variables into consideration.

Get a Quote Now

 

Experience

When you’re hiring a tax advisor, you need to know his or her experience. You want to know that this person has the years of experience needed to be able to help you save money on your taxes. You’d want someone that has the ability to set up bookkeeping services, personal or corporate taxation, audit and report services, setting up and managing accounts, landlord support, tax investigation support, payroll services, and VAT submissions. You also want someone who is constantly updated to the constant changes in the world of taxes. best tax advisor in london

Trust

When ever you’re giving all of your bank account details and information over to someone, what you have to have is tax. Make sure this person is trust-worthy with all of your bank details and other information. You always want someone you feel completely comfortable with. If you feel like that the firm you are working with is not qualified enough to do the jobs they are required, it’s best to find business else where as soon as possible.

Qualifications

When you’re looking for a good tax advisor, it’s probably not a good idea to look up the yellow pages, flip to a page and hope for the best. Since the internet has developed our ability to research companies, it’s best you research what qualifications the Tax Advisor has. If he’s recent, he probably won’t have the experience to stop you from paying as much tax as as possible. That’s what you want to stay away from.

Transparency And Integrity

When you’re looking for someone that you can trust to do your taxes, what you’re looking for is someone that will give you the satisfaction of knowing that all costs and fees have been discussed and agreed to in a professional manner. One thing you need to do as a trusted company is to make sure that all agreements and prices are transparent. This makes it better for you as a client and others to build a healthy relationship. Make sure that you find a firm which has fixed fees so they cannot add or change fees to their advantage when you continue to do business with them.

Why I Should Hire GM PROFESSIONAL ACCOUNTANTS To Do My Taxes

In this section we’re going to give you some advice on why you should get GM PROFESSIONAL ACCOUNTANTS to do your taxes. GM PROFESSIONAL ACCOUNTANTS Provides a service for individuals who are just looking to get their taxes done, as well as sole traders and business owners. The great thing about GM PROFESSIONAL ACCOUNTANTS  is that they offer great bookkeeping services that will stop you having to worry about doing the work yourself. They are a respectable and honest company which is built on a foundation of integrity and trust to provide you with their best service possible.

To Finish Up

If you want a good Tax Advisor, there are many ways to go about it. You can cut some corners and end up getting it done by Uncle Harry, but the chances are he’s probably not going to know how to save you from taxes. If you’re willing to invest a bit more in having a quality agent look at your taxes, and sometimes other areas to help you, then that’s the best solution. Just research who you’re going to go with first completely before you hire someone.

 

Get a Quote Now

 

 

 

 

 

 

LATE TAX RETURN PENALTIES   

 PENALTIES FOR LATE TAX RETURNS

The tax year always holds up from 6 April until the 5 April following year. At the end of the tax year (after 5 April) the employees should receive a P60 form from their employer. This form contains the current year income statement, the amount of tax withheld and social security. This must be sent to the HMRC (tax office) by the employer.

If a person leaves his job during the year, the employer must issue a P45 form, which also contains the income, the withheld tax and the social insurance. This form has three copies and the next workplace should transmit copy 2 and 3, that the new workplace may deduct the tax appropriately and return it to the tax authorities.

Smallbusinessaccountants

It is essential that the new workplace receives the data of income from the previous working places, otherwise it will not deduct properly the tax advances, and the person will possibly have tax backlog at the end of the year that he will be required to pay to the tax authority.

 

But who is obliged to submit it?

 

• If you are self-employed

• If you had at least £ 2,500 of untaxed income in the current tax year 

• If your saving or investing was over £ 10,000 before taxation

• If profit was derived from shares, second homes and the sale of other taxable assets

• You are a director at a company (except if it is a non-profit organization and you weren’t paid for it)

• If your or your partner’s salary exceeded £ 50,000 and you required child support

• You have incomes from abroad, after which you must tax 

• You live abroad, but you also gained money from Britain 

• Your salary exceeded £ 100,000

 

If you work as an employee, your employer will arrange this, so you can ease the belly, because you do not have to do anything in this matter. However, the information may be useful for everyone. 

 

According to the British tax authorities (HMRC), tens of thousands of small taxpayers could avoid the lump-sum, simply by an earlier administration of the declaration. Those who administrate before 30 December have the opportunity to pay in installments if their payment obligation is less than 3,000 pounds. Those who owe less than £ 3,000 and want to pay in installments have to return their tax online until the midnight of 30 December and have to request a PAYE (Pay As You Earn) code.

 

 

The late return fine

 

Late return is a quite costly passion. Tax declarations arriving after 31 January are penalized by a late fee of 100 pounds, even if you have no tax liability or you pay your tax on time, and that’s not all.

 

If the tax return is delayed for three months, you need to count another 10 pounds per day late fee, so the 90-day pro-rata late fee and the original 100 pounds fee may climb up to 1,000 pounds. 

 

If the return is delayed for six months, then you have to pay 300 pounds or the 5% of the debt besides the original punishment, depending on which is higher. In case of a 12-month delay another penalty will be added and in severe cases the duty may be even reduplicated. 

 Contact GM professional Accountants and choose a Local accountant to assist in your tax affairs.

Accountants open on Saturday

Businesses open on Saturdays

The need has come for Accountants to open on Saturdays. Opening of both private and public firms on normal days in the United Kingdom should run from Monday to Friday, depending on the country’s stipulations in the constitution of the United Kingdom. These are the basic principles for opening days of offices in the country and are required of all firms to suit fin the schedule in order to serve the public better. Any institution bestowed with the responsibility to serve the public be it accountants, the teachers and those in other private businesses should adhere to the common rules that govern us as a nation bound by common principles and way of life.

Accounting firms are bestowed with the responsibility to serve the nation in matters of book keeping, helping businesses in ensuring they do not overlook the tax return deadline on top of the many other responsibilities they are entrusted with. The accountants in the respective institutions work optimally into fulfilling the needs of the clients in the various offices of accounts to ensure that at the end of the day, the clients’ do not exceed the tax return deadline that has huge penalties on going past its threshold.Accountants open on saturdays

GM Professional Accountants

Welcome to GM Professional Accountants, where we serve customers in a much better way in consideration of many factors. At GM Professional , we have put it a guarantee to serve our customers six days a week without compromise for we treasure the individual needs of the clients’ in their respective positions. We ensure that the tax return deadline is not exceeded by our customers for we care about the huge and heavy penalties our bookkeeping departments would have to bear on behalf of the client. The clients’ subject to penalties because of exceeding the deadline for our deliberate failure to open on Saturday is one thing we avoid. We open on Saturday on a full time from 9.00 am to 5.30 pm for the many reasons that we thought would be an advantage to our esteemed customers.

GM Professional Accounts believe that most people are busy during the week days and only find time on Saturday to work on attending to their other offside duties like filing their tax returns. It is on Saturday, according to GM Professional accountants, that people have time to go attend on private issues for instance checking on the tax return deadline from their various accountants since during week days they barely leave their places of work for such activities.

The book keeping team at GM Professional Accountants have the pleasure of serving their customers right from 9.00 am to 5.30 pm all the six days of the week Saturday being the last for the week. Accountants at GM Professional are keen into taking into consideration the records of the customers for book keeping for disappointment from the clients is not part of their calling. Saturday in most cases is the day that most people turn up to file returns in order to avoid getting past the tax return deadline. GM Professional Accountants make up part of the firms that keep London City live and meaningful on Saturdays.

Tips on Selecting the Best Accountants in London

Best Accountants in London

While seeking the best Accountants in London, you’ll need a leading and diverse accountant’s firm. Accountants are well versed in managing and keeping all types of accounts and are of great help in managing the finances of the business. They can be of substantial help to every type of business as they will well assist employers in keeping their accounts up to date. The assurance is, if you have the best accountants, you’ll have the best insights and updates in the current business and economic markets. Trusting someone with your money can be a daunting prospect, but with the experienced and innovative accountants, you will always be at peace since your finances are in safe hands.

 

Get a Quote Now

 

It is not much difficult to find the best accountants in London. Today, many reputable companies are offering such services to their customers. This article discusses on how to find the most reliable accountants in London. best accountants london

Check on their Certification

Whether you want to hire full-time or part-time accountants in London, for both jobs, you need to understand what you’ll need to look for in the accountant you will be hiring. Your future accountant should be a member of a given accounting body here in the UK. Whether

they are Certified Public Accountants, Chartered Accountants, AAT Licensed accountants or any others, a license is necessary. Check the expertise of the person you are employing.

Good Working Experience

Furthermore, accountants in London should have a good work experience. Choose for the companies that can offer very diverse services because of their experience with a number of accounting aspects. Consequently, one can hire such firms for bookkeeping services, personal or corporate taxation, audit and report services, setting up and managing accounts, landlord support, tax investigation support, payroll services, VAT submissions and information on account software. Aside from the knowledge they possess regarding all these accounting services, they can offer financial advice based on the latest news in the financial world. By hiring them, you will always be updated with the latest trends in the financial industry, and you will make the most informed decisions.

Budget Friendly

Accountants in London are not only for the selected few with very high income. While many self-employed individuals consider that it is easy to do their own bookkeeping, they seldom find out what they are missing out on until actually hiring a professional to help out with their calculations and tax returns. When hiring accountants in London, they soon learn that what they saved in terms of money, they lost in terms of time spent preparing the documents and learning how to submit their calculations to HMRC. Please do not make the same mistakes. Accountants are not a luxury. They are beneficial to you and most often are necessary as the system is quite complicated to figure out on one’s own.

Trustworthy Service

The most important aspect when hiring accountants in London is to be able to trust their services. To ensure they get their jobs done well and on time, we recommend you check the way they present their firm, the recommendations they have, their reviews and testimonials. If they are trustworthy, reliable accountants they won’t let any of your clients down and will do their best to earn the confidence of new clients by showing their reputation with pride.

Transparency and Integrity

The best accountant firms in London will ensure that all costs and fees have been explicitly discussed and agreed upon prior to carrying on any financial services. Good companies have to make sure that all prices are transparent since integrity and honesty is an important part of a healthy client relationship. Additionally, such companies ensure that they offer a fixed fee on advice and consultation disregard of the time taken. They do this to cater for surprises or hidden costs that may incur at the end of the month.

Get a Quote Now

 

5 Simple But Powerful ways On How To save tax for landlords.

 5 Simple But Powerful ways On How To save tax for landlords.

If you happen to be a landlord, you fall under the category of people who happen to own a business. And one nagging question that happens to come to the minds of business owners like landlords is the question on how they can save taxes. It is quite challenging as you are required to keep track on how you can take the necessary precautions to save on tax. Here are some of the 5 ways that landlords can consider to save tax on income.
Get your tax affairs up-to-date;
If you happen to be a landlord, you are fortunate. You need to know the Tax Advantages that come with owning your property for rent and how much they can fetch you.
There are some tax exemptions that you can enjoy from this monthly income money that can be turned to your advantage. Taxes keep on changing from time to time and the figures and terminologies like (tax returns) that come with the taxes are very important for you understand.
Staying informed about taxes will also help you avoid the HMRC getting over board and manipulating you just because you may happen not to know anything about the changes that were done at a specific time.

Find a good Serious Tax Adviser.

A serious and good tax adviser is essential when it comes to ways on how to save taxes as a landlord on your income. These people can and will save you a lot of time by offering you multiple options when it comes to your taxes. They give suggestions, they follow up and clarify your taxes, and they help in filling of the forms among others.

Landlord accountants
However it is important to note that you have to look for one who is ready to understand you and your demands and help in taking advantage of what you are already doing and offer additional suggestions that can save you more.
It is important to note that most tax advisers will charge you a certain fee for their services. Most will even charge you for each form that they fill which means it better to know some these important issues as they will help you in saving taxes.
Narrow your choices when it comes to tax advisers and you need to be curious when dealing with them as many may even lack the experience and knowledge about taxes.

Keep Claiming For all expenses;

This is something that many landlords will forget but the truth is that you have to always make sure that you claim for all your expenses when handing in your tax returns.
These should normally include telephone bills, cost of safety documents, any form of bank charges like overdrafts, legal and renovation fees of any kind.
Remember to have a separate bank account for all your money that you get from your rentals. This helps in that when tax inspectors happen to ask all these questions about your taxes, it makes it very easy for you answer them as this will take away all the confusion.
It’s Better To Find A partner.
If your property is being run by one person, transferring that property into a joint ownership will save you on income tax on your yearly profits. If you happen to sell, capital gain tax and allowances will be much easier for both partner as you will be able to set the annual capital gains exemptions against the profits made.
Have your own Records Stored:
Never forget that any business including that of which you have with tenants is completely in writing and that you have the documents at hand. Record keeping is very essential especially when you happen to have tax areas that you may not know about.
If it happens to be in writing this will save you a lot of time and money and thus reducing your taxes as a landlord.
If you happen to use an online only bank account, you have to always remember to print out your copy of the statement as often as possible.
Remember paying taxes is one the oldest activities in this world that no one will escape. However it would be nice to pay up all your taxes and avoid penalties like paying more of going to jail.

How to find Accountants near me

Accountants near me Looking for an accountant in your local area? This is a great idea for you to pursue, since having an accountant that knows your area, is easily accessible and can give you local knowledge can help you grow your business. No matter where you live, finding an accountant that is close by will pay dividends in the long run. Let’s take a look at several areas around London where accountants can be easily found. 

 

HMRC Tax Investigation Accountants

Accountants near Ilford

Ilford has experienced great business growth over the past century. Ever since it became a transport hub with the movements of large railways, it was counted as an important business borough of London. These days, with close transport to central London, Ilford has plenty of opportunity for people looking to expand their business into central London. 
If you are looking for an accountant near Ilford, there are plenty of highly qualified practices to choose from. Making sure that the accountant has a good idea about the area and a deep understanding of how you can utilize the proximity to the city to your business’ advantage. 

 


Accountants near Barking
The area of Barking has been home to creators of vehicles for centuries. Before the car plant in Dagenham, the area was famous for boat construction. The last few decades have heralded in a de-industrialisation in the area, and thus a surge and opportunity for entrepreneurship have emerged. 
Accountants in the area will have deep ties to former large companies that used to operate in the area. Combined with this, there will also be an understanding of how you can best combine a local business with the more fast-paced activities that are happening in central London. Finding one of these competent accountants can be done quite easily online, and will most likely enable you to expand your business successfully. 
Accountants near East Ham
East Ham is a hub that is very famous for the large amount of local independent eateries that exist. The variety truly represents the melting pot that is London. This combination of cultural diversity and entrepreneurship is a prime place for someone to take their business to the next level. It thus follows that there are many local accountants that exist to help service the local businesses. This is an opportunity for people living in the area who are looking for a East Ham based accountant. 
By checking out GM accountants, there is a huge selection of accountants in the East Ham area who have had decades of experience helping and growing East Ham businesses. The opportunities that can be available to your business through a local advisor can be enormous.
Accountants near Romford
With world-renowned shopping sites such as the Brewery, and the Liberty shopping center, the opportunities for independent businesses is abundant. Since Romford is now a mainstay of shoppers and visitors, local businesses should be capitalizing on the traffic. 
There are many great, experienced local accountants in Romford, and a cursory online search will show how much talent there is to choose from. Making sure that your business is equipped with the best financial help that you can get is important. 
Getting a local accountant is much more important that just convenience since your future business growth can be interrelated with an accountant near you.

Do i need to complete a tax return

Tax return season is almost upon us. The dreaded deadline looms where we have to get ready to pay up to the tax man. If you are wondering whether you are required to fill out a tax return, wonder no more. Let’s go through in detail about who and why you are required to fill out a tax return.
Who needs to fill out a return?
If you are self employed, in a partnership or run a limited company, you need to submit a return. It’s quite simple really, if you are an employee, then your boss has the responsibility to liaise with the tax man. However, if you are in charge of your own affairs (for instance, you are registered for self assessment, have your own Unique Tax Reference (UTR) etc) then you are where the buck stops in terms of tax.
What if I have stopped being self employed?

If you were self employed, but now hold an employed position or perhaps are taking some time off, you may still need to fill in a return. The tax year runs from April to April, so let’s say for instance you were self employed from from April 2015 until February 2016, then stopped. You will be required to fill out a tax return at the end of January 2017 for the time you were self employed. Make sure you inform HMRC that you are stopping self assessment so you are not liable for any more tax returns.
In some cases, you may be entitled to a tax rebate if you have overpaid tax too, which is an extra incentive to get it done!
How do I do it?

Filling out a tax return form is very easy. All that is required is your accounts for the year, a computer and 20 minutes of your time. However, some people find the process a little difficult and time consuming, which is why it can always be a good idea to hire an accountant to take care of any of the stress that you may be feeling.
Steps1) Get your UTR, and sign in to the government gateway2) Calculate all of your income, and deduct from it all of your employment related expenses (check with an accountant, or HMRC as to what exactly you are allowed to claim)3) Fill out the form as instructed via the online portal4) Submit the form5) Pay your calculated amount of tax
What comes next?
If you are going to be registered for self assessment for the foreseeable future, then you are going to have to get used to filling out a yearly tax return. If however you are going to be an employee, there is no need to worry about filling out a return regularly.
To alleviate yourself from any pressure, it is always good advice to seek the help of an accountant near you. In this way, all the paperwork can be submitted on time and in order so that you are left to pay attention to your business.
Nobody likes paying tax, but making sure everything is in the correct order and organized will can lead to great benefits in your business and quality of life!

Digital tax: ‘HMRC wants a direct link to everyone’s bank accounts’

Digital tax: ‘HMRC wants a direct link to everyone’s bank accounts’

HMRC have announced that they want to build, “the most digitally advanced tax system in the world”. This includes in particular a direct link to your bank account, making self employed taxation almost automatic. What are the benefits of this system? What will it change for you? Let’s explore this.
How do they do it currently?
The way that self employed tax is collected now is through a yearly return, with records being kept by each individual business. Of course, HMRC doesn’t have the time or resources to go through each and every invoice or expenditure that a business generates. To a certain extent, they trust your word on the tax return. However, HMRC reserve the right to audit your business at any time, requiring you to provide evidence for any tax calculation you have submitted.
What are they planning on introducing?
The proposed system from HMRC, although not explained in great detail at this point will essentially digitize the entire tax process. This thus means that in theory that they can view your business bank account in real time. This will allow them to monitor the activity throughout the year and make it easier to spot potential tax fraud when tax time comes.
Another feature that they are discussing is the possibility of logging all payments and earnings in real time. Through the release of some apps that are integrated with various systems any invoice that you receive can be simultaneously logged by the HMRC system. This also is true for any revenue you receive, thus giving HMRC an approximate idea as to how much profit you are making before you even send your tax return.
HMRC claim that this is not an attempt to gather all our information like the, “stasi” but a way to streamline their processes, and make the collection of tax pounds easier.
Why are they doing this?
It makes sense that in an era where technology is advancing very rapidly, the government will start using it more and more. Another large reason will be that hiding some income will be increasingly difficult. This includes people who work in a mainly cash based business. Eventually you are going to put the money in your bank account, and when you do, it will show up on the HMRC system.
It will also mean that computer systems can be set up to spot fraud or irregularities and flag them quicker. This will save man hours in terms of auditing or other admin tasks that a computer could handle.
What will it change for you?
If you are already paying your taxes on time, not massaging your accounts and generally being honest, then nothing really should change. What some people are worried about is that HMRC may start demanding tax more regularly throughout the year. This is something that HMRC have categorically denied, stating that the current once per year model will remain. We should always bear in mind that they are the government, and the government doesn’t always have a good track record for keeping their word!
One fear that people are voicing include the idea that the technologically slow will suffer with this new technology. Obviously, as time goes on, this factor will become less and less important. It does mean however that the tech non-savvy will have a period of adjustment to this new process. HMRC will probably provide good help and guidance for these people, and of course hiring a good accountant will be very important in these cases.
How can you prepare for it?
There is nothing that can especially be done to prepare for this new technology. What is important is that you are making sure you are currently paying your taxes properly. Since, when this new technology comes into place, you may end up with less money in your pocket than you are used to. As mentioned previously, hiring an accountant will save you plenty of headaches in the long run.
If you are currently diligent about your taxes, then there isn’t anything to worry about, this technological trend isn’t going to end anytime soon, it is going to transform almost every area of our life, so we just need to get used to it!
Wrapping Up
This isn’t bad news for people who are honestly paying their taxes. It can be alarming to think that the government will have a prying eye into our personal accounts, but the boring truth is that it is probably just a cost saving exercise on their part! Sit back, relax, the robots are taking over!

GM professional accountants based in London and Essex.

Allowable self employed expenses

Allowable business expenses

You want to only as much tax as you have to, no more no less. This means that when you are submitting your self employed tax return, you need to know what you can, and what you can’t claim back. Let’s talk about what that means, and what you can deduct from your yearly tax.
What is an “allowable expense”?
This is a term used by HMRC to discuss expenses that you are allowed to deduct from your tax return. So for instance, you earn £50,000, and your expenses are £20,000. What this means is that you only have to pay tax on the remaining £30,000. This saves you a lot of money!
Let’s walk through which expenses are allowable according to HMRC.

Office Costs

If you work from home, things like the heating, the rent, the mortgages, and the electricity can potentially be claimed back. You will have to declare exactly what is used for work, and what is used for everyday life, but you could claim a lot of this back.

Stationary Costs

Pens, paper, printer toner, special software for your business. All the small details that you need to run your business effectively, you can claim back. This can be broad, so long as you are not using these programs and items for your home life exclusively, you can claim them back.

Transport

If you drive alot, need a van or travel generally, these are considered as expenses. The fuel you use, the hotel rooms you stay in and even part of the car you drive. Again, you cannot claim for journeys that are personal in nature, but everything that is business related is fair game.

Clothes

No, not your new trainers…unless you are a runner. Many self employed workmen need special equipment to work properly. This can all be taken away from your tax return. This also applies to any uniforms, or outfits if you are an entertainer!

Employee Expenses

If you are employing people, then their salaries, any fees or benefits you give them can also be taken off the tax return. Again, the theme here is anything that is a business expense, you can claim back.

Reselling Items

If you have left over stock, raw materials or production costs, these are all fair game too. Not claiming these can really eat into your profit margins.

Legal and Financial

Lawyers, accountants and anyone else who will help you with your business. This means that if you get an accountant to help you with your tax return, you can claim that back too!

Marketing Costs

This is a great one for entrepreneurs, since these costs are all considered as an expense that can be written off. Marketing is a huge part of a business, especially in the beginning. This means that your business has a better chance of survival early on!
Wrapping Up
By making sure that you are not overpaying your taxes, you will have more money in your pocket and your business. This will mean that in the years to come you can earn more, invest more and not have to worry so much. If you are unsure whether an expense you have would be regarded as tax exempt, then a good idea would be to get in touch with a local accountant and they will have all the answers, and potentially some new ideas about other savings you can make!

The Scientific Reason Why Dressing for Success Works

 Dress for success.

It sounds like a cheesy phrase rolled out by salesmen of the 1980’s, but is there some truth to it?

Overwhelmingly, all research done on this matter has concluded that yes, dressing can have a direct impact on your success in business. What are some areas that science shows us are directly impacted by how you dress? Let’s take a look.

Negotiation

An experiment that asked people to negotiate the same deal, but the two test groups were made to wear different clothes. One group wore a track suit, the other a smart suit. The difference was astonishing. On average, the group who were dressed smartly would walk away with 4 times more profit that the previous scruffy group. This is not a small amount, and it can show that the skills that you are able to employ when dressed for success can include negotiating a much better deal than you thought was possible.

First Impressions

A large study found that based off who we appear, people will make conclusions about our character that are quite detailed. For instance, whether you look like you are on your way to a promotion, whether you are successful, intelligent, adventurous or trustworthy. This means that making sure that your dress matches the message you want to send is very important. If you an accountants firm that is hoping to attract the business of a small tech firm who all wear hoodies, then maybe a three piece suit will send the wrong message.
Dressing for success can depend on the situation. However, in general, a smart, well fitting suit will get you noticed in good ways.

Confidence and Self worth

There are hundreds of studies that confirm a strong correlation between dressing well and your confidence level. If you feel attractive, then it will show on your entire body. Your walk, your voice, your posture, it will all change. This might be exactly the advantage that you need over your competitors. There is a reason why most people walking around London aren’t in jeans, but in suits.
This is a good lesson to learn, since your self worth can often become how much you are worth. Think about how you feel after a new haircut, with new shoes, with that new perfume on. You feel unconquerable, you feel like you are walking as a god among men! This feeling, if then applied to your work, can bring in new levels of success.

If you are self employed

If you work from home, it can be tempting to just wear whatever you find in your wardrobe, however this isn’t always the best idea. If feel sloppy, untidy and generally unfit for public, how are you going to create something that is fit for public? Your work is always affected by your own perceptions of self worth.
This being the case, making sure you are dressed well, even if no one sees you is a very important for your continued success in your business. Your work will most likely improve, your productivity will most likely improve, and as a result, you may be earning more money.
All this from putting on a shirt in the morning instead of that coffee stained Batman t-shirt with holes in!

 

GM professional accountants based in London provide small business accounting and tax services

Common Tax return questions

Common Tax return questions

Far from being the mysterious entities that are completely impossible to understand by mere mortals, they are quite simply really! There are so many questions that people consistently ask about their tax returns. So let’s take a look at these, and give a clear precise answer!
Your tax return troubles are over!

1) How long do we have to keep business records?
Good that you are asking this question firstly! Most people don’t even consider keeping their records when it comes to their business. However, there is an obligation on your part to keep your records for 5 years if you are self employed.

This is so HMRC can review any data that you may have over the past 5 years as they might have questions.
If you are a limited company, they you should keep them for at least 6 years. There are some exceptions, for instance, if you have some data that spans more than one tax year, then you should keep that for longer. In general, keep them all for 6, and the very important ones keep a hold on indefinitely.

2) How much does it cost to get an accountant to do your tax return?
This all depends on where you live, and what type of accountant you choose. The nationwide average (not including London) is around £200 -300 for a tax return. However, remember that you can reduce this from the tax you pay.
If you go to a large accounting firm, then the price could be even higher, and in London, often accountants can charge a lot more. The best practice in this case would be to look for a reputable local accountant. You want quality and not just a cheap price, it could save you more money!

3 ) How much does it cost to get an accountant?

So this question refers to hiring an accountant in general to assist with all manner of financial dealings in your business. This rate is generally applied by the hour, and the rate can be anywhere from £70 per hour up. However, again, talking with local accountants, and negotiating some sort of deal is possible. Remember, when approaching an accountant you should have a good idea as to how much you will use them over the course of a year, this can then be budgeted into you business.
4) How long do you have to keep receipts for tax purposes?
The receipts that you have from your day to day business activities should be kept with the rest of the accounting information. This would then fall under the rules stated in question 1. So keep a neat file with the receipts in, and then dispose of them after you are no longer legally required to have them.
5) What is meant by self assessment tax?
The term is fairly self explanatory when you understand it. Essentially, unlike when you are an employee, your tax is not automatically calculated for you by the government. You are in charge of your own calculation, therefore, you “assess” the level of tax that you pay. This obviously doesn’t mean you can pay as little as you want, what it means is that the calculation process falls on your shoulders.
6) Who has to fill out a tax return?
If you are self employed or own a business, you have to fill one out. This means if you do a little work on the side, it all needs to be declared and answered for! So if you are not an employee of a company, and make money another way, then you have to fill one out. Simple.

7) What is the annual return?

The annual return is something that is submitted to companies house, and it is solely for the purpose of taxing limited companies. Many self employed people do run a limited company, and this means that they are required to do exactly this.

8) What is a short tax return?

A short tax return is something that only specific types of people have to fill in. One such person would be someone who started trading in July, something happens, and they cease trading in September. HMRC will then usually ask that person to fill in a short tax return. It is a condensed version of the regular tax return. However, don’t worry excessively about these, since if you need to fill one out, HMRC will ask you directly.
Hopefully this has answered some

How a hard brexit will affect businesses and indiviuals

How Brexit will affect Small businesses

The moments that Farage and over half of the country has been waiting for is nearing. Article 50 is just months away from being triggered, and the position the UK is in currently doesn’t seem to be poised for an amicable split.
The crux of the negotiations all hinge on the single market, and the caveats that come with it. According to polls, the second biggest issue in the whole referendum was immigration. The rhetoric about overcrowding, low paid labor and British workers missing out was at the heart of everything.
Britain is trying to stay within the single market, but change the parameters, namely, all the perks, but no free movement of people. Francois Hollande on the 6th October gave a speech which has strongly warned other EU members that this cannot happen.
In Hollande’s words, ” Britain wants to leave, but not pay”. Essentially, his comments tell us that either you can stay in the single market with everything that comes with it, or you can leave completely. This seems to be the feeling across the whole continent, and a so called “Hard-Brexit” is every more likely.

How will it affect small businesses?

Brexit has heralded in an era of a slumping pound. The strength against the dollar and the euro is down considerably. Whilst foreign exchange rates aren’t always the best indication of overall economic strength, it can give us an indication of the feelings out there. Since Britain is a trade deficit nation, not entering the eurozone in the first place enabled the country to keep out of the recessionary cycle the eurozone is in right now. This means then, that a hard brexit can only present a difficulty for businesses. Since we enjoy a single market relationship with Europe without the disaster of the Euro currency to deal with, what will remain is no access to that single market. This will cause costs to rise, and the potential for firms to move into the single market zone.
The logic behind the Brexiteers is that Britain will once again take up it’s old manufacturing past (which was deftly dismantled by Thatcher) this solution will take years to implement, and won’t have an affect for a long time. So for businesses, expect some tumult in the following years, as a hard brexit can and will affect trade.

How will it affect the self employed

Depending on your area of expertise, the self-employed person might be in their element. The modern day self employed entrepreneur is well equipped to deal with market tumult, since often times, money can be made anywhere on earth. This also means that there will be many opportunities opening up in the near future with all the brexit uncertainty in Europe.
Perhaps now is the best time to be self-employed, since you will have control over your own finances. This means that huge shifts in the world economy can largely leave you unaffected. Relying on salaried work might leave a more uncertain future.
To summarize, a hard Brexit may or may not happen. Currently, it seems likely that the EU will try and make the UK feel the consequences for leaving. However, the EU is headed for a stagflationary spiral that will affect the UK anyway, so the best advice would be to focus on creating your own sources of income, and don’t rely on market stability in the coming few years

 

GM professional accountants are specialists in small business accounting services.

Setting up a limited company in the uk

Setting up a limited company

Getting into business is exciting, there are so many challenges and opportunities that await you. You might be at the point now where you have decided to set up a limited company. There are considerations to make sure this is the right decision for you, so make sure you are informed.
Let’s go through the simple process of setting up a limited company, then talk about some of the benefits of it, then some frequently asked questions.
How to setup
This process is simple. The easiest way to do it is via the companies house online portal. The form you need to fill in is very simple, however there are some details that you need to have on hand before starting the process.
– Company name. This is obvious, however, your name must be unique, and if you want to chose something that will represent your company well. Think of something that properly sums up what you do, your mission statement, and how you are going to add value to your potential customers.
– Shareholder, director and secretary. It doesn’t matter if you are a one man band, or a growing team, you will need to allocate these roles straight away. They can all be the same person if you are working alone. These allocations are very important. Take advice as to what the best choice would be. Allocating shares or roles incorrectly now could lead to some awkward situations down the line. These need to be backed up by a memorandum of article of association. This is the paperwork that confirms all the roles.
– Company address. Every company is required to have a registered address. If you are a lone wolf and don’t want it registered to your home, then even renting a mail box is allowed.- Register for corporation tax. This again can be done through the government’s portal. This needs to be done within three months of starting your business. You can do it here, https://online.hmrc.gov.uk/registration/newbusiness/introduction
The actual process is very simple,you can set up a limited company online https://ewf.companieshouse.gov.uk/runpage?page=welcome. After you have done this, it is time to start running your company!
Benefits

Why should you create a limited company? Well in England and the rest of the UK, you can run a company as a sole trader. However, there are certain benefits to being a limited company.
Protection. If things go badly in your company, and you are unable to pay business debts, the limited company is liable and not you personally. This means that in the worst case scenario, you are protected. You may not want to think about that happening, but it is a prudent business move to consider all possibilities, and protect your risk.
Tax. Yes, the dreaded word. With a limited company, the structuring of your payments into dividends and salary making what you pay more tax efficient. The rules can confuse some people, HMRC have provided a great explanation on their site, check it out here. https://www.gov.uk/government/publications/dividend-allowance-factsheet/dividend-allowance-factsheet#examples. Being informed on this can mean you pay less tax, and take home more money.
Funding. This is an issue that many people are facing in the modern world. Many startups have the opportunity to receive funding. Seed funds, angel investors or crowdfunding are now possibilities for thousands of businesses. If you are a sole trader, it is going to be harder to convince a collective to fund your project. Investing into a limited company provides a much more solid framework to structure the deal in.
Professionalism. Your image can mean the difference between closing a sale or losing it. When dealing with larger companies, often times they want to feel like they are dealing with a legitimate and solid business. Having the Ltd at the end of your name can give your potential clients much more peace of mind.
FAQ

Is it expensive to register a limited company? No, it is £12 if you do it online. By paper it can go up to £40.
Are there special records I need to keep? Yes. You will need to keep accurate and through accounts, added to that you will need to keep the registers of members, and other similar items. Read all the details here, https://www.gov.uk/running-a-limited-company/company-and-accounting-records. Keep this in mind when setting up the company, a good start will save paperwork later.
Am I automatically trademarked? No. When you register a company name, that name will not be taken by another company. However, a trademark is something different. You will need to apply for a trademark for your company separately.
What about PAYE and VAT? These can also be done on the government portal. You are not automatically registered for these, so if they fit your requirements, then you can sign up for them too.
Wrapping Up
The key thing to remember when setting up a limited company is to stay informed. You will have a lot more responsibility now, so read everything you can, and make sure all the boxes are ticked. All the best with your business!

Choosing an accountant in East ham

East Ham is nestled in one of the most prosperous and expensive cities in the World. The area has a rich history, and since the mid 1800s railway arrived, has been a hive of activity. Let’s take a brief look at the history of East Ham. Then, let’s talk about the economy, opportunities, and ways you and your business can be helped.
History
This place was mentioned in the Domesday book, which gives you an idea as to how ancient the settlement is. As the time wore on, East Ham became a hub for people moving in. There were large amounts of immigration during the 20th century, and that has been a huge effect on the current landscape of East Ham today.
Economy
The unemployment rate in East Ham is one of the highest in the UK. In addition, the employed positions are mainly low paid. This causes some problems, and opportunities for the locals. The problems are that some poverty rates are high in East Ham, however the government in the past few years have responded. Some successful initiatives were introduced, and the unemployment rate fell.
One of the positives that has come out of the relatively tough jobs market is entrepreneurship. Many of the shops and restaurants in the area are independent. The large migrant population set up these jobs several years ago, and as a result, opportunity and job creation have arisen.
Opportunities in East Ham
Since the above mentioned job creation schemes by the government, the rankings of East Ham have improved. The deprivation rate has fallen from it’s once top spot, and incomes have improved in general.
The opportunities are also abundant for those who are local, and want to start a business. Since the property, rents and rates are lower than central London, a chance to make a success out of shops or services exist in the area. Add to this the fact that many new young professionals are moving to the London outskirts, including the east end. These new residents will be looking to shop from local stores, and embrace the local culture. This is a good opportunity that can be capitalized on now.
Getting setup, and choosing the right team
For many aspiring business owners or service providers in East Ham, finding the right help can be tough. The reason is that many people work in the city, and as a result don’t work with the local businesses. An example can be finding the right accountants in east ham. This addition to your team is an important one. The trick in an area like East Ham is to look for an accountant who knows the culture and the locals. This way, financial guidance and help can be given within the correct context. A city accountant may be used to the types of businesses that flourish in Canary Warf, but have no concept of how things are done in East Ham.
These are some ideas for getting yourself setup in East Ham. The times are getting better, and the future looks optimistic. The opportunities for the youth and others in these areas can be taken through hard work and entrepreneurship. Finding the right team to back you up, and give you the right guidance can be a great step to you and your community’s success.

GM Professional Accountants are accountants in East ham that specialize in Small businesses and self assessment tax returns.

How to register as self employed in the UK

Registering for self employed and receiving a UTR number

Deciding to be self-employed can be a hugely important step, and it is one that many people will look on as the best decision they made in their careers. So you right now may be a ball of emotions, your ideas and plans must seem very exciting! This enthusiasm is great, and will serve your business well.
Let’s just come down to earth for one second and talk about the first step you need to take in your self-employment journey. You will firstly need to register for self-employment. What does this mean? How can you do it? What things should you keep in mind?
Right now, there might seem like a million and one things you need to sort out, but it is very important that you sort out your legal and tax issues first, then get on with the rest. Let’s guide you through it step by step.
What are you?
Don’t worry, this isn’t a philosophical question about your existence. It is, however an important question to ask yourself with regards to your legal status. Since you are now responsible for many more things such as business debts, expenses, potentially employees, you will need to answer this question.
With your business, there may be different classifications as to which legal term fits you best. Sole trader, partnership, limited liability partnership, etc. Look in to these different definitions, and decide what will work for you.
We are going to talk mostly about being a “sole trader” as this will fit most people.
First Steps
You will need to go to the HMRC website. to register as self employed. Go to this site and follow the instructions. The term used for self-employment on the site is “self-assessment” this basically means that you are going to asses your own taxes once per year.
1) You may already have a “government gateway” account, and if this is the case you can start registering straight away. If you don’t have an account, then you will need to fill out your address, and in 10 days you will receive an activation code to your new government gateway account.
2) Using your new government gateway account you can now begin the process to register as self-employed UTR number . For this, you will need your national insurance number on hand, and all your usual personal info.
3) The site will present you with a form to fill in. It doesn’t take long, and is just your personal info, national insurance number, address, DOB etc. After filling this in, you will receive confirmation in the post after a couple of weeks.

National Insurance and details

– Something that you will automatically be registered for when you sign up as self-employed is national insurance contributions. You will be paying Class 2 national insurance automatically. This is just a few pounds per week, and is compulsory. There is more to national insurance, read about it here. https://www.gov.uk/national-insurance/how-much-you-pay
– Do you need to register for a VAT number? Only if your earnings are going to be more than £83,000 per year. You can do this later if you see this happening.
– If you are in the construction sector and work as a contractor, you will need to registers for a CIS (Construction Industry Scheme) also. Read about that here. https://www.gov.uk/what-you-must-do-as-a-cis-subcontractor/overview
What Next
Registering for self-employment is very easy. Following the above instructions will lead you the right way. Don’t forget that once per year, you now have the responsibility to submit your tax return through the government gateway.
Keep good records of your income and expenses, and your self-employed journey will be a very enjoyable and successful one.
Now that you have gotten all the paperwork out of the way, you are free to work on your business, worry free!

Starting to freelance

You may be thinking of going freelance, and if so, well done. However, there are certain legal obligations and differences in how exactly you are going to do so. In the UK there are two main categories of self-employment, they both achieve different goals, and require different skill sets. Let’s take a look at which one will suit you the best.

Self-Employment/Self Assessment

This is the simplest option out there. Simply put, you are personally responsible for the company. This means that all of the comings and goings of daily business are under your name. Anything that happens is viewed as your sole responsibility. If for instance you are self-employed and you owe a large amount of business debts, you will be held personally liable. The resultant consequences could be personal bankruptcy. On the positive side, when it comes to the tax man, you only have to pay one lot of taxes, since it is all viewed as your personal income.

Limited Company

The way this is usually explained is thinking of a person. When you create a limited company, in the eyes of the law, the limited company is viewed as a person. Now this doesn’t mean that the company can vote, get married and adopt children, but it performs other roles. For instance, if you are running a limited company and the company has debts it cannot pay, the company will be made bankrupt. However, you as an individual will not, since you are viewed as an employee of the company.
These are the essential differences. There are more, and we will discover them in a moment. Let’s first look at which one you should choose?

Self employment

This will suit you if you are providing a service with little to no liability or risk. For instance, if you are a personal tutor, or a contractor this will suit you. Anything that involves you providing a service, consulting, or freelancing with no buying and selling, most of the time this will be your choice

Limited Company

This is more for creating a business. If you are going to be buying and selling, potentially owing debts, or lending out on credit. If your business model has high overheads, high liabilities or is going to be in negative equity for periods of time, then register as a limited company. This will protect you if things go badly. Another case will be if your business grows to a large size. Even if your overheads are still low, if someone sues your company, or some other action is taken against it, then making it limited protects you.

What are the requirements of both methods?
Whatever you choose, it is important to remember what your new responsibilities entail. For instance, both require you to submit yearly tax returns. For self-employed people, it is the self-assessment form that needs to be filled, plus your national insurance contributions. It is often important to get these figures checked by an accountant before you submit, as inaccurate filings can lead to a fine, and you are personally responsible for it.

For a limited company it is more complicated. You will need to take care of corporation tax, staff tax, national insurance and all of this must be recorded in a very particular way. HMRC reserve the right to demand your records from you at any time. Any changes that occur in your company must also be documented and reported to HMRC.

It might sound like a lot, but don’t be put off. Often times, entrepreneurs realise that getting a little help by way of an accountant can alleviate much of the new pressure that is piled on them. In the first few years of your business, you will want to use all your energy to make sure the business succeeds, so getting help with the paperwork is a good idea.
So to recap, self employment and limited companies are the two ways to go in freelancing. Both require a little getting used to, so choose which is best for you and get going!

GM professional Accountants are specialist freelance Accountants in London. 

Made the decision to be Self-employed and need an accountant?

You’ve just taken one of the most important steps in your career, you have completed the Self employed registration form and become self-employed! HMRC has been notified, and you are now your own boss. You feel great. It is now time to sit down and think about exactly what you need to make a huge success of this.

What are your new responsibilities?

You have your business plan, your clients and your vision, but what about the details that you are now responsible for? Well, if you were previously in an employed position, then you know that your employer took care of administration. This included your taxes. Now you are self-employed, the responsibility lies with you.
This is the part of self-employment that doesn’t fill most people with enthusiasm. It can be an added burden considering that you are busy running your business. It is for this reason that many self-employed individuals decide to hire an accountant to assist them. Ask yourself, “would an accountant benefit my business?”. Let’s have a look at a few ways that people have benefited from an accountant guiding them through their self assessment.

Remembering everything

In 2015 890,000 people in the UK failed to turn in their tax return on time. If this is your situation, it can result in a fine from HMRC. Remember, not filing your self assessment return is illegal. You are also required to ensure you keep good records of your business dealings. HMRC have the right to ask you about something from several years ago. Failure to produce the correct record may result in a fine. This isn’t written with the intention of scaring you, it is just attempting to highlight what HMRC expect from the self-employed. It is for this reason that recruiting the help of an accountant can be a good idea. They will know exactly what is needed from HMRC, they will make sure everything is submitted on time, and correctly. It can save you plenty of time. This leaves you with a clear head, to run your business.

Pay Less Tax

Accountants are essentially experts on tax law. The result of hiring an accountant, can many times mean you pay less tax. This is not suggesting that you should get an accountant to weave some complex web of offshore companies. It is however a sound business decision to ensure that you don’t pay unnecessary amounts of tax on your income. Are you completely aware of all the allowable expenses that can apply to your tax return? If you look them up, they may surprise you. Equipment, mileage, and many other things can be claimed as expenses from the tax man. You could do some in depth research into exactly what you can and can’t deduct. Doing so, however, will reduce the amount of time you can commit to your business. An accountant will be able to remove this rather large workload from your shoulders, and make you “tax efficient”. They essentially are in the know of how much to claim for self employed people.

What about the costs of an accountant?

Now, let’s get down to brass tacks (not tax). An accountant will not work for free, it is going to cost you money. However, let’s look at the benefits against the cost. Firstly, we have discussed that often you will be paying less tax if an accountant does your tax return. Secondly, it will also make it so that you aren’t paying any fines to HMRC from late or wrong paperwork on your part. Thirdly, you will be able to focus more time and energy into, for instance gaining more clients, or improving your website. You want to use that extra time to improve your business. The argument can be made that hiring an accountant is a good business choice. The best part of it all is that the accountants fees can be claimed from your tax bill!
Unfortunately, there doesn’t exist some giant tax calculator that can magically solve all tax problems. The alternative is investing in an accountant. This will help your business to function smoothly. So why not think about looking for an accountant that suits your needs? Often, accountants have good business knowledge. This means that in the long run, they can be more than just someone who helps you with tax. Accountants can often become trusted business confidants, so.
Hope that this article has helped you gain insight into your taxes. And of course, food luck with your self-employment!

HMRC LAUNCHES NEW WORLDWIDE DISCLOSURE

Introduction

Launched on 5th September 2016, Worldwide Disclosure Facility (WDF) relates to offshore interests. This is interlinked with the Common Reporting Standard (CRS) which automatically gives bank information and registers of beneficial ownership around the world.

Through WDF, HMRC will now have full ammunition in investigating those individuals who don’t use voluntary disclosure opportunity. This will see closure of all available closure opportunities such as Liechtenstein Disclosure Facility (LDF).

With up to 300% maximum penalty for defaulters, WDF is considered as the last chance before tough penalties and sanctions are applied. This sanctions include criminal investigation , naming and shaming.’

Who can use WDF?

WDF is available for anyone who is willing to disclose a UK tax liability relating to offshore issues. These includes:

· All income obtain from a business or asset outside the UK boundaries.

· All activities carried outside the UK territory.

· Assets outside the UK boundary

· Anything with the same effect as income, activities or assets as described above.

· Funds connected to unpaid UK tax not included in the above but has been transferred outside the UK boundaries.

The facility does not only apply to UK residents. Anybody who is not in UK is able to make disclosure if they are eligible to the above criteria.

Registration

One is required to notify HMRC using its Digital Disclosure Service with the following information.

· Name

· Address

· Date of birth

· Unique Tax Reference

· National Insurance Number and

· Details of references

· It is advisable to give extra information as HMRC uses it to check for accuracy.

After disclosing the above details, one is given 90 days to:

· Get all required information needed in filling the disclosure.

· Calculate tax, duty, penalties and interest liabilities

· Use the Unique reference number obtained after notifying them to fill in the disclosure.

Terms and conditions for WDF

The terms for WDF include

· Be eligible.

· Be able to make full disclosure of all previously undisclosed tax liabilities.

· Be able to calculate interest and penalties based on the applicable law.

If one fails to make an accurate or complete disclosure or decides not to send additional required information, HMRC is allowed to:

· Open an investigation and file a case in a court of law and open a criminal prosecution.

· Publish your details in their website.

· Apply a much higher penalty than it could be the case if the disclosure was voluntary.

Terms and facility limits

This facility is only applicable for issues on assets, activities and income outside the United Kingdom territory. One is able to fill disclosure for onshore liabilities with a much lower penalty.

The facility is also limited to liabilities of a period of not more than one year before filling the disclosure.

How to notify HMRC

As soon as you are aware of the disclosure facility, notify HMRC that you intend to make disclosure. This is done through their Digital Disclosure Service on their website.

After that, HRRC will notify you through an email your unique DRN that use will use for the disclosure process and a payment reference number (PRN) that you will use to make payments.

Completing the Disclosure

After notifying HMRC your intention to make disclosure, you will be given 90 days to make your offshore liability disclosure. You will be provided with details on how and when to make payments.

If you are not able to make the required payments, you will be required to sign a payment agreement and submitting it to HMRC before making disclosure.

You will be require to fill the HMRC disclosure service form available at the HMRC website.

Penalty

After calculating you offshore liabilities depending on the disclosure categories, the penalty will be applicable depending on:

· Inaccuracy in returns and document factsheet.

· Failure to notify.

Higher penalties will be applicable under the following conditions:

· Whether you are under investigation by HMRC.

· You are not following the current laws on penalty calculation.

· Your disclosure is connected on a previous inaccurate disclosure.

Conclusion

WDF is not only targeting notorious tax evaders. The facility apply to anybody, unknowingly or through ignorance. It is therefore advisable to keep up with the latest HMRC development and make timely and faithful offshore liabilities disclosure. You can contact them to discuss specific circumstances and disclosure requirements.

Register as self employed to day with GM professional Accountants. we specialise in self assessment tax returns and we are in the heart of London.

 

 

 

Sole trader v limited company

Becoming self-employed is a career-changing decision. The need to conform to an employer’s standards is exchanged to being your own boss at the cost of handling all of the legal and financial aspects of your business. Hence, most business enthusiasts consider teaming up with a few individuals or with a relatively large group of people to ease the responsibility of keeping the business afloat. As a sole trader, you are the business itself. In a limited company, however, the business is an independent body where you are a director and a shareholder holding a portion of the company’s capital. However, success in business is a case-to-case basis. Some may find themselves paying more tax than necessary which is why it is imperative to decide on the best business structure early on and carefully plan out the course you want your business to take.

1. Legal Disputes

Sole traders are personally sued unless they are covered with applicable insurance such as employer’s liability. Limited companies can also be covered by insurance and more often, it is difficult and rarely a case in the UK to directly sue the chief executive of the company. Unless they are proven to have perpetrated fraud (as employers, as service providers or as taxpayers) and have committed offences against the law such as violating environmental acts.

2. Tax

Corporate taxes are considerably lower than income tax. Shareholders and employees are subject to PAYE (pay-as-you-earn) and NICs (National Insurance Contributions) based on their individual earnings where many other benefits may attract tax as well. An income tax based on dividends and other distribution types are rules among shareholders with a £5,000 tax-free allowance.

3. Losses

Sole traders can negate their trading losses against their other means income. However, in 2013-2014 in UK, there has been a restriction on the respite that may be claimed for losses and interest payments. On the other hand, limited companies can still neutralize their losses to other revenue sources but without compensating their income as an individual.

4. Profiting

Withdrawing cash from a sole proprietorship include no taxes while any income from a company, be it a dividend, a distribution or personal earnings, are subject to respective tax collection. Employment benefits received by a shareholder or their family and household are also taxable as with the shares and securities.

5. Borrowing

As a sole owner, you are free to run the funds of your business considering that tax relief and bank charges will be comparably controlled. On the contrary, a director may borrow business funds subject to the limits set by the Companies Act of 2006 where a tax charge of 25% is paid by the company if the loan is not paid within nine months. If the loan is interest-free, an individual tax is charged against the director based on their beneficial loan interest.

6. Accounts

There is no requirement to maintain accounts if you are a sole trader (although it is difficult to manage your business without keeping some). But you have the leisure of choosing cash or conventional accounting if you decide to do so. Further, you may need annual accounts to provide your personal tax return even if these accounts are not required by the HMRC (Her Majesty’s Revenue & Customs). Your taxable earnings must also be filed in accordance with the GAAP (Generally Accepted Accounting Practices) where you must hire a business accountant unless you can do the job yourself.

For limited companies, annual accounts are required in accordance with the Companies Act for filing with Companies House and should be in par with UK’s accounting standards. HMRC is imperative on the full accounts for Corporation Tax which should be submitted through the government’s provided format.

7. Selling the Business

Sole traders are personally taxed on any gain from selling the business under the CGT (Capital Gains Tax) while shareholders are taxed twice: corporation tax and dividend tax but may consider selling company shares than selling the trade or business itself.

8. Death

The sole proprietorship terminates when its owner dies unless they transfer all ownership to another. Limited companies can still continue to operate even when the executive officer dies because the business is an independent legal entity.

9. Personal Earnings

As you hold the funds of the business, a sole trader may withdraw any amount he wishes although paying a family member must be commercially supported for tax purposes. Members of limited companies have no limits on the amount of earnings they can receive. But these are subject to PAYE and NICs where service payment given to family members follow the same tax rules.

10. Expenses in General

Tax reliefs are obtained by declaring expenses exclusively incurred for sole proprietorship operations. The same can be said in a limited company, however, the private expenses of the director can be declared as a company earning, or a distribution if incurred by a shareholder.

With all the items presented above that show the differences between a business run by one person and a company shared by a group. A business enthusiast should be guided on which option to choose to make the best out of their planned business (this can also be a guideline for ongoing businesses that wish to restructure their operations) to maximize profits, minimize tax returns and ultimately, avoid bankruptcy.

 

GM Professional Accountants are Accountants in London that specialise in small businesses and self employed tax returns.

Travel and Subsistence

Travel and Subsistence

The government has approved that the changes will go ahead to prevent contractors from attaining tax relief on the costs on travel to work. This is including the cost of accommodation related to the travel or the cost of the contractors’ meals.

The change of travel and subsistence was declared earlier this year, at the time the decision was being made the government was considering to include everyone who worked via a PSC (personal service company).

We now know that the changes for Travel and Subsistence will not affect personal service company contractors, unless the contract is caught by IR35, the anti-avoidance rules. This means the contractor was registered as self-employed and worked as individuals rather than using a personal service company, he can then continue to obtain tax relief on travel and subsistence.

Though, this is not the end of the story. Changes to the anti-avoidance rules (IR35) are also likely, following a review  by the Office of Tax Simplification. Any changes are likely to tighten the current rules and make it easier for HMRC to police and enforce.

Accounting and tax services in London

Does IR35 Apply to Your Taxes?

Every year, you need to make sure you have all of your financial details in order so that either you or your accountants can complete your taxes. If you are wondering about which tax rules and regulations may apply to you, it is important to consider all aspects of your financial portfolio. Considering what work you do, who you do it for or with, how you get paid, and what types of supplies you need for your job are all important questions that will help you fill out your taxes more easily.

 

As mentioned above, how you get paid can greatly impact your taxes. If you are paid via an intermediary, then the UK tax legislation called IR35 comes into effect. This specific legislation will tax what it deems “disguised employment.” The designation of disguised employment means any work that you do where you get paid through an intermediary. This also means that the intermediary will need to have been paid directly by the client, just like a normal employee would. This type of compensation chain makes the IR35 tax designation come into effect.

 

This IR35 will the tax any employment you do where you receive payment through an intermediary. The rate that this income will be tax at depends on the rates that similar employment forms are taxed. The type of work you do for the intermediary will be assessed to see what the rate should be to tax your intermediary-paid income. This tax act was developed in 2010 in order to ensure that citizens receiving payment in this manner were paying the correct amount of taxes. It helps to avoid the previously common practice of workers splitting ownership of companies with their relatives to avoid paying the tax at the level they should have owed.

 

IR35 is also impacted by direction, supervision, and control. Some instances where IR35 will apply are if you work in construction, if you are an office-holder (a special designation that has a great deal more information attached to it), or if you happen to work with your partner. IR35 also applies if either your intermediary or your clients live abroad. Finally, if you are working for a charitable organisation through an intermediary, it is important to know that IR35 will not apply, that is as long as you work for this charitable client through a Managed Service Company or through an agency.

 

In the event that you do get paid through an intermediary, you will need to follow these IR35 rules and claim the income you receive on your taxes. One of the easiest ways to make sure that the IR35 legislation applies to you, and to make sure that you are paying the correct amount in taxes is to enlist the help of an expert accountant. A licensed accountant will be well aware of this legislation, and will be prepared to help you figure out just what it will mean for your individual tax situation. While it may seem complex, accountants will simplify the process, giving you the peace of mind knowing you have filed your taxes correctly.

 

It is helpful to know what HMRC is and to know where your taxes are going. HMRC is the authority that the United Kingdom has established to be put in charge of any tax, payment, or customs related work that goes on within the UK. The money that the HMRC collects goes to a variety of purposes, at the discretion of the government. The basic fund go to public services that keep the countries within the UK running. Additionally, money collected for these purposes can be given to individuals who are identified as needing financial support.

GM professional accountants are  known as specialist contractor accountants in London.

Some of the Biggest Tax Issues affecting small businesses

 

Accounting is what helps investors, tax authorities, and managers, to know about the financial data of a company. Accounting is all about the recording of financial transactions, journalizing, Sorting, summarizing and reporting the information in different accounts and analyses. Accounting is also considered a profession that many people often opt for. An accountant is an individual who is well versed with the accounting principles and standards. He is a practitioner of accountancy and has proficient knowledge in technical skills. They also their clients in filing the tax returns and hence also known as tax accountants.

In UK a tax accountant is considered to be a practitioner who has specialized knowledge in tax accounting. These accountants can help their clients with the various tax issues. Tax consulting is important for all to know more about the taxes. A tax accountant will gather all the necessary documents and forms required for filing the tax returns. The tax related issues are crucial. Let’s now look at some of the biggest tax issues the tax accountant has to deal with in UK.

The most challenging part of managing a small business in UK is dealing with taxes. Small businesses are the most common group to be targeted by the IRS for various reasons. Many small business owners understand their craft but are unprepared for dealing with the intricacies of tax laws. The lack of tax law knowledge often turns into an audit or even worse from HMRC. Making sure to avoid certain mistakes can drastically reduce the likelihood of an enquiry. Reporting a net loss year after year is sure to trigger a second look from the HMRC.

Another common trigger for an enquiry is using personal expenses as business deductions. Travel, entertainment, and company vehicles can all be deducted but must be used for business purposes. Overstating expenses or declaring 100 percent use of a vehicle that isn’t solely used for business are all carefully watched. Detailed record keeping is another way to protect a company from an enquiry. Having records is even more critical for businesses that deal with regular cash transactions.

One area that HMRC will focus on is evaluations on payroll taxes. Processing proper tax payments for employees can be one of the trickier parts of dealing with taxes. HMRC knows this is a common area of error and will look for mistakes even if they aren’t done intentionally. For any small business, it’s always best to use a qualified tax accountant to prevent problems before they happen. Spending a little upfront can result in huge savings later one.

How can an a qualified Accountant help a small business being audited or harassed?

Running a small business in UK is hectic and stressful. Finding out that HMRC is opening an enquiry can make things much worse in a hurry. Once a company has been targeted, they will constantly be harassed until a resolution has been reached. . If a company finds themselves being audited or facing a demand for payment, it’s best to find a certified tax adviser immediately. Getting a tax adviser early can save a lot of money in the long run. In addition to saving money, it takes a lot of time to go up against HMRC. Experienced tax adviser are experienced and are much better equipped to tackle the issues. Getting a fair settlement worked out will be worth the cost of having a good tax adviser in your  corner.

GM professional accountants specialise in bookkeeping services for small businesses

Dividends

It will be clear that for 2015/16 financial year, those with all or some of their basic rate tax band available will be better off taking dividends rather than salary during the year, as they will pay no further tax on the money they receive. Basic rate taxpayers are treated as having already paid 10% tax on the cash they physically receive. In light of the changes that are happening for the new financial year, it will be beneficial for basic rate tax payers to take advantage of this and pay dividends to yourself by 5th oh April 2016 without paying any tax. Delaying dividends till after 6th April 2016 may mean that you will have to pay an additional 7.5% on any dividends you receive after you exceed the threshold. The dividends tax free threshold for 2016/17 will be £5,000, which is added onto any of your personal allowances, which you may have only used some or none of your allowance. GM Professional accountants are small business accountants in London.

Effect of Brexit on Small Business

Brexit only happened a few short months ago when the United Kingdom decided to leave the European Union, and small businesses are just now starting to see the effects. When big moves happen in any country’s government, the effects will trickle down to citizens through the economy which is usually more damaging for those that have a small business. Brexit, since it happened so recently, has not shown a substantial difference in most small businesses, but you should know what to expect in the future.

Know Your Present and Future Risks

Now that Brexit has happened you should expect that this is going to change the shape of your company whether this is marginally or on a larger scale. The biggest issues that businesses have complained about are the difference in tax on some goods. Some transactions will require additional fees that were previously free or reduced. The biggest thing to remember is that everything is in a period of transition and although it’s different it doesn’t necessarily mean that it’s bad.
International Business Problems
Currently, most small businesses are not experiencing much difficulty continuing with their international accounts. Experts do state that it could take up to two years before owners see the effects of this change on their revenue. Exchange rates are fluid and change all of the time, so this is just another aspect of business operations that owners should understand. However, it is stated that smaller companies should be prepared to buy higher shipping fees because their volume is lower than larger competitors.
Uncertainty of the Future
Many small businesses were completely unprepared for the finalization of the Brexit vote. This is only the first step into unchartered waters where businesses have never headed before. The most efficient way to survive this change is to be easily adaptable so that you can easily transition and survive.
Future Economic Issues
Most small business owners are successful because they can accurately access their day to day risks and know how to handle their revenue appropriately. With the introduction of Brexit, businesses no longer have anything to gauge their future against because the economy has changed. There are many ways that you can survive this change with minimal loss by being even more conservative in your business practices. Make sure that you have a little bit of overhead in your accounts so that you prepare for unexpected costs.
Best Steps to Take After Brexit
The biggest thing to remember is that panicking isn’t going to be useful in any situation and that this situation will pass and be in the history before you know it. It may seem like a good idea to overreact with your finances, but it’s better just to wait awhile before making any big moves. However, there are a few things that you can do to make sure that small businesses are protected better from Brexit fallout. Make sure that you build up some cash to have in reserve. You should also pay attention to all of your clients and their locations so that you can decide which relationships might change. Then, at the end of the day, focus on your customer service because your small business will continue to thrive long after Brexit has left the headlines.

GM professional accountants are small business accountants based in London.