While accounting firms like GM Professional Accountants only hire experienced, pedigree experts to make up our accounting team, we know that many of our clients are not in a position to hire such levels of expertise.
As a result, we thought it would be helpful to turn the spotlight on financial skills testing.
If you are a software company hiring a computer programmer, you’d validate that he or she could code. If you are running a hospital, you’d validate that the next surgeon you hire knows his or her way around a scalpel. Well, the same should be true for any team members you hire for your finance team.
There are a host of suppliers of online accounting tests, and a number of these provide specific skills tests to evaluate the abilities of a future hire to your finance team. If you are hiring an entry level position, then your focus might be on basic numeracy skills. If you are seeking a bookkeeper, you will need to ensure that your successful candidate knows a little more. For more senior positions, you may want someone who knows Sage Line 50.
All of these skills can be tested. Professional skills testing vendors provide assessments to validate candidate skills across a variety of roles, and accountancy skills testing is no different.
Hiring the right employee for your finance team, however, is not just about “hard” or technical accounting skills. You’ll also need to evaluate how well the candidate will fit into your broader team. There’s no point hiring someone who supports your financial balance sheet but damages your team balance sheet (and I apologise for the truly awful pun). This is where psychometric testing can begin to play a part. Again, mainstream skills testing vendors provide validated psychometric assessments that can be used to evaluate how well a potential hire will fit into your team.
The cost of a bad hire in the financial department can be huge – particularly for smaller firms. Validating the ability of your potential hire before signing on the employment contract is an excellent way to maximise your chance of avoiding this!
The Dutch limited liability company (called a BV) is often used in international structures. In this article you will get to know about the main characteristics of the capital of a BV. The Dutch Civil Code does not contain many restrictions in the use of capital since an amendment in the year 2012. The articles related to the public limited company (called a NV) were not updated, which make that much of the following will not apply to this legal form.
How can a BV be funded with capital?
At incorporation of a BV, at least one share shall be issued. By law there are no limitations in regard the nominal value per share or capital. Stamp duties do not exist in the Netherlands.It is not mandatory to pay in share capital immediately after issuance, though from a liability perspective it is not advisableto issue shares without paying them up. In case of a bankruptcy of the BV shareholders can be requested to pay up all shares.
Above the shares’ nominal value share premium can be paid. To do this, a notarial deed is not required. An agreement between the shareholder and BV plus a shareholder’s resolution is sufficient. Note that a share premium repayment is possible though only in case that there are no profit reserves and no profits expected for the coming three years. Otherwise there is a risk of having to pay dividend withholding tax. Check this with your Dutch accountant and tax advisor. As an alternative to share premium repayment, share premium can be converted into share capital and the nominal value of shares can be decreased, allowing a tax neutral repayment. A conversion of share premium and change of nominal value require notarial deeds.
What kinds of shares can a Dutch company issue?
Priority shares, referent shares, tracking stocks and non-voting shares can all be issued by a Dutch company. Also, combinations of the characteristics of these types of shares can be created by means of letter shares.
Priority shares have decision-making powers with regard to one or more subjects mentioned in the articles of association. Priority shares usually have no profit entitlement.
Preference shares are characterized by the fact that the sharesyield a fixed return that is not linked to the operating result (but can be linked to market interest, for example). The return on these shares is paid out before the return on the normal shares.
Tracking stocks are shares that only entitle the holder to the profits made with certain activities or subsidiary of the company.
Non-voting rights do not entitle to vote, though allow shareholders to benefit from profits. It can be used as a tool for estate planning or to have investors or employees participate in the company.
The shares of a Dutch company can be denominated in any kind of foreign currency. This can be handy in case your company’s cash flows will be mainly in foreign currency. It is allowed to have an authorised capital, though no mandatory.
Can a Dutch company purchase its own shares?
A BV can purchase its own shares. Also, it can cancel such shares. Under Dutch law a capital protection scheme exists for purchase of own shares. This same scheme is also applicable to dividend distributions and share premium repayments. The purchase of shares as such is not subject to a maximum, except that at least one share with voting rights shall be with a shareholder. The management board is to perform two tests. The company may not acquire its own shares for payment if (i) the shareholders’ equity and reserves do not allow, or (ii) if the management board knows whether it should be reasonably foreseeable that the company will not be able to continue paying its due debts after the acquisition.
Its flexibility makes that the BV can be used under many different circumstances. It for sure contributes to the fact that it is the most popular legal form in the Netherlands.
It is vital to get the company structure, share classes, shareholding, and articles of association accurate during the setting up stage at companies house.
At GM Professional Accountants, we pride ourselves in providing the most ample advice on the setup of new limited companies. We have offices based in London, Manchester and Essex.
During the setting up of a Limited Company, Company Formation is just the first step of many. You will need to consider start-up activities such as registration with HMRC business taxes, which is a service most conventional company agencies do not provide.
We provide comprehensive services that include tax and accounting compliance registration that include:
Registration of Business addresses including Mail Forwarding Services
Registration for PAYE
What to Expect from Our Company Set Up Services
Online company formation in only three hours
Company name availability search
Documents by post or email
Registration of the company for Corporation Tax, PAYE and VAT
Business startup pack
Recommendation on the most optimal business structure
Accountants’ letter to help in the opening of a business bank account
Articles and memorandum of association
The Different Types of a Limited Company
Private Limited Company by Shares – Most Popular
This is the most popular type of limited company and is the favourite for freelancers, small businesses and contractors. The limited company typically issues profits and shares via dividends.
If you are a member of a business that is limited by shares, the obligation that is owed is limited to the number of unpaid member shares if any.
If the company becomes insolvent, the shareholder is not legally required to make any contributions to offset any debts of the business.
Company Limited by Guarantee
This business structure is mainly favoured by charities.
If the company is dissolved, it is the shareholders responsibility to contribute to the total sum of money they agreed to guarantee for it.
If a company that is limited by guarantee is liquidated or wound up, then every member will need to contribute to the amount they guaranteed. This is to offset the debts the company owes while they were a shareholder. The amounts involved are typically relatively small.
Setting up Fast
If you have ever tried to set up a company, you know that it can be a frustrating experience as there is a lot if paperwork to fill in and forms to submit.
GM Professional Accountants Do It All for You
We can complete the paperwork and submit the forms so that you are set up for trading as soon as possible.
Filling out the Forms
We will take charge of all the paperwork. This will include the compliance requirements of the company formation such as Memorandum of Articles and Articles of Association.
Some of the businesses that favour this type of company formation include freelancers, small businesses and contractors. The limited company will typically issue their profits and shares via dividends.
Shareholders of companies limited by shares are limited to the amount unpaid if any on the members’ shares. Once the member pays their shares in full, the shareholder does not have any liability for the debts of the company.
Virtual accounting refers to a system where a qualified accounting expert offers their accounting expertise and services to businesses and individuals virtually instead of physically working at the business premises of the client.
Virtual accounting provides all the benefits you would get if you hired a professional that would physically work from the office. However, given that the virtual accountant is a contractor and telecommuter, the service will often be cheaper.
Virtual services make this possible as they provide greater flexibility for the accounting professional and for the client.
Advantages of Virtual Accounting Services For Your Business
With virtual accounting services, a business can get its accounting handled by a professional accountant rather than having to contract a full-time accountant. This helps companies cut costs as they can pay for services only when they need accounting work done.
It is an excellent solution particularly for small businesses that may not have the budget to engage a full-time accountant yet need a professional to do their accounting.
Virtual accounting may also prove cost-effective for big businesses that may need extra assistance even if they have their own internal accounting department. Virtual accountants can work alongside company accountants to offer their services to reduce the workload for as long as the business needs them.
It provides a unique combination for companies that may not have the funds to hire extra accounting staff but still need additional help.
A small business that cannot afford a knowledgeable and experienced accountant full time or does not have the need to hire one will benefit a lot from engaging the services of a virtual accountant.
Many small businesses run into trouble and fail within three years for a number of reasons. These include an inability to hit upon a business model that produces enough revenue, and failure to differentiate themselves from other businesses in the space. With a virtual accountant providing critical accounting services, they will be able to be in touch with the realities of the marketplace while keeping their financial goals in sight.
Instead of hiring a full time accounting professional getting a virtual accountant can be huge as the professional will provide services that include:
1. Filing and preparation of CT600 and Accounts for small business Limited Company services
2. Tax return services for Personal Self-Assessment
4. VAT advise and VAT returns
5. Tax return services for Self-Assessment
6. Pensions and payroll auto-enrolment services
GM Professional accountants have offices located in London, Manchester and Essex.
The EU VAT guidelines are intended to make it possible for small businesses to trade in the EU area short of needing VAT registration in all EU nations. While the regulations tend to be complex, the alternate scenario would be more bureaucracy and work.
At its core VAT is a consumption tax. A business registered for VAT will have to pay VAT whenever it makes a purchase and then claim it back when they make their VAT returns, which includes all the purchases made. VAT registered businesses doing businesses with each other can shift the VAT to subsequent purchasers. As such, it is the final consumer who has to pay the VAT as they cannot pass it on or reclaim it. Since the consumer eventually pays the VAT, it is called the consumption tax.
EU VAT is intended to have the same effect and hence businesses registered for VAT and doing businesses with each other within the EU can transfer VAT to subsequent purchasers up to the consumer and never have to deal with the complex regulations of each country.
There are several critical distinctions to take into account though:
Business versus Consumer
EU VAT differs depending on whether the purchaser is a business or a consumer. For the purposes of VAT, it will also be dependent on their VAT registration status. Overall, a purchaser with no VAT number means they are a consumer and one with a VAT number means they are a business. As such, any business not registered for VAT will be deemed a consumer.
Services versus Goods
If you are selling or buying only in the UK then services and goods receive the same treatment on VAT returns. Any trading done outside the United Kingdom whether it be for goods or services will mean that VAT will default to place of supply VAT rules.
It is very straightforward for goods. Goods exported from the UK to other EU countries are subject to VAT rules in the UK, while goods exported from Germany to other EU countries are subject to German VAT rules. Therefore, goods will be subject to the VAT regulations of the country of the seller.
The assumption when you are providing services such as training or consulting is that these will be delivered in person. As such, the VAT rules are inverted with the place of supply being the location of the customer. For instance, a British company consulting for a French company will have the VAT rules of France applied since the place of supply is assumed to be France. UK VAT rules will not apply as the sale is deemed out of its scope given the location of the customer.
Sales to EU consumer (not registered for VAT)
Any consumer that is not registered for VAT will have to pay the final VAT either in the EU or the UK. For all intents and purposes, sales will be treated as a sale to a United Kingdom consumer. Normal practice is to add the UK VAT of 20% to the total amount.
Box 1 (VAT payable in the period on sales)
Box 6 (Total value of sales not including VAT)
Excluded on EC Sales list
This is good if only a small part of your sales are done outside the UK. But once you start making huge volumes of these sales or a significant increase in the value of such sales, you may need to register for VAT in the given EU state and be subject to the relevant country’s VAT. Each country has different thresholds.
If your EU sales value is more than £250,000 a year, you will be required to fill an Intrastate Supplementary Declaration.
Digital Sales to EU consumer
There are different processes and rules if you are selling digital services to consumers not registered for VAT within the EU. In such an instance, VAT needs to be charged using the local rate with returns made using VAT MOSS.
Sales to EU business (registered for VAT)
You need to have the VAT number of the customer for the transaction to be deemed a business transaction. If you do not have the number, then the transaction is a consumer sale. Both the customer’s VAT and the business’s VAT number have to be indicated in the sales invoice.
Any sales made by a business in the EU also needs to be indicated on the EC Sales List. The EC is a distinct quarterly or monthly return that may not necessarily conform to the schedule of your normal VAT returns. You can get this produced automatically in various accountancy packages so that all you need to do is submit.
Goods to EU business (Registered for VAT)
If you happen to be trading goods to an EU business that is registered for VAT, then you can get zero-rated for VAT, if you do not add any VAT on top of the net value. Most accounting systems will include a specific VAT specification for this. If you are selling goods, the UK is the place of supply and hence UK VAT applies but it is zero-rated. This means that the sale has to be included in the EC sales list.
VAT zero-rated – show VAT as £0.00 and charge net value
Box 6 – Total value of sales not including VAT
Box 8 – Total value EC sales exclusive of VAT
Include in EC Sales List
Services to EU business (Registered for VAT)
If you are selling your services in the EU, the obligation of charging VAT rests with the customer. If it is a service you are selling, UK VAT will not apply since the customer location is the place of supply. Goods are zero-rated for VAT, meaning that you do not add any value to the net value of goods. You will still need to include your sales of services in the EC Sales List. Most accounting software includes a category that makes this possible.
0% VAT – show VAT as £0.00 and charge net value
Box 6 – Full value of sales not including VAT
Do not indicate in Box 8
Indicate in EC Sales list
The flat rate VAT?
If you qualify for the flat rate arrangement, then input VAT will not apply. The obligation for VAT will be determined as a percentage of the gross sales turnover over the tax period. To get your gross sales add in the 20% of VAT, which means that the owed VAT is a percentage of the total, for instance, an IT consultant will have to pay 14.5%. The percentage is intended to act as cover for VAT on acquisitions but excluding the tedium of having to go through all transactions.
If you are exporting services or goods to an EU business registered for VAT, you can avoid VAT by zero-rating the sale. But how does this influence the flat rate turnover determination?
Selling goods to the EU – Add them in the EC Sales list
Selling services to the EU – Add them in the EC Sales list but since UK VAT does not apply, exclude them from the flat rate turnover.
Buying services or goods from the EU – Sales turnover is the basis for the calculation of VAT and hence it does not matter whether EU purchases have VAT or not.
What if you are buying services or goods from the EU? The same rules are applicable though now in reverse.
For imports greater than £260,000 of merchandise in a given year from the EU, an Intratat Supplementary Declaration will have to be submitted.
Consumer Purchases (VAT registration not provided to the supplier)
If a business does not give the seller their VAT number, then the business is deemed a consumer. Just like on the sales side the seller’s rate includes VAT and forms part of the final price.
As a consumer, the final VAT lies with you and you cannot pass it down the line. The item will be treated like it had been bought from the United Kingdom without any VAT applied.
Box 7 – Total value of acquisitions
Procurement of Goods from a Business in the EU (Registered for VAT)
You need to give your VAT registration to the seller who also needs to have a VAT number in their country for the purchase to be deemed a business transaction.
Buying of EU goods typically gets VAT charged just as if you made the purchase from the UK from a British supplier. As such, the 20% charged in sterling will apply. You can either use the published rate or find the exchange rate published by the HMRC to calculate how much is owed.
It might seem strange that the seller gets to charge 0% while you get to claim a VAT rate of 20%. But what you need to know is that the VAT rate of 20% is included in BOX 2 when you are submitting returns on EC acquisitions. Box 2 makes up the input VAT total. Therefore the VAT amount on the sales side cancels out the VAT on the purchases side, which results in a net effect of zero VAT. Overall, you should get a fair deal as the overall transaction will have a zero VAT impact just like that of the seller.
Box 2 – VAT owing on EC purchases during this period
Box 4 – VAT reclaimed on acquisitions during this period
Box 7 – Total value of acquisitions
Box 9 – Aggregate value of EC acquisitions plus VAT
Buying of Services from a Business in the EU (Registered for VAT)
This is the reverse of the sale of EU services as discussed previously. The place of supply for services from the EU is the customer location. Regardless of the country from which the service is bought from, UK VAT applies and you are responsible for filing VAT and not the seller.
The reverse charge is what is used to deal with such purchases. It does sound complex given that transactions are treated as both purchases and sales on the VAT return. It does look as if you are buying the service from yourself. The item is included in the VAT on purchases total and the purchases total as well as the VAT on sales total and the sales total. This will result in zero VAT except for a situation when not all purchases may be included.
The seller should have furnished an invoice excluding any VAT. Include the total amount paid in addition to the 20% VAT. The VAT amount includes the purchases (input) total and the sales (output) total, which will result in zero effect on VAT owed.
Box 1 – VAT owing on sales in this period
Box 4 – VAT reclaimed on acquisitions in this period
Box 6 – Aggregate value of sales without VAT
Box 7 – Total value of acquisitions
Excluded in boxes 2 or 9
This article is targeted at small companies with few transactions within the EU. If you run a more complicated business or are planning on large volumes or regular trade with the EU, getting specialized advice is critical.
Sale to EU (not registered for VAT) – treat as UK sale. Exclude on EC Sales list. Add 20% VAT.
Sale of merchandise to EU (registered for VAT) – zero rate VAT. Include on EC Sales list. EC sales section on the VAT return.
Sale of Services to EU (registered for VAT) – Zero rate VAT. Include on EC Sales list. Not on the EC sales section.
Buying of Goods from EU (registered for VAT) – Include on EC Acquisitions in the returns. Add 20% VAT.
Buying of Services from EU (registered for VAT) – Exclude from EC Acquisitions. Include in purchases.
GM Professional accountants have offices located in London, Manchester and Essex.
The introduction of the Capital Goods Scheme (CGS) is intended to help adjust the input tax recoverable from the purchase of particular capital items that may not be fully employed in the production of taxable supplies.
The good thing about the scheme is that it acknowledges that a business may use some assets over several years and there may be differences over the years on how the capital items are employed in the making of taxable supplies. It thus offers a mechanism through which a business may adjust the original input tax claimable over a period of up to a decade.
Assets that may be adjusted on the scheme include:
Computer hardware worth at least £50,000
Civil engineering works, fitting out works, refurbishments, buildings, and land worth at least £250,000
Aircraft and ships worth £50,000 or greater
VAT is not included in the valuation.
The scheme is not applicable to expenditure or assets a business acquires with the intention of resale. Nonetheless, the CGS may come into play if the business uses the asset before selling it on. On the other hand, the item will not be deemed an item of capital if it is traded before it can be used.
The acquisition of a capital item that qualifies for the scheme means that all the rules for input tax are applicable. These include:
Input tax has to be recovered in full for all items used fully in the production of taxable supplies
Input tax is not recoverable if the item is used in full to make tax-exempt supplies
A business may claim a percentage of the input tax according to the partial exemption regulations, if the capital item is used to produce a mixture of exempt and taxable supplies.
Subsequently, an input tax modification needs to be made if there are any changes to the degree of taxable use during the adjustment period. If the taxable use goes higher, the business may claim more input tax and if it goes down, it may have to repay a portion of the input tax that had been claimed.
The scheme will also take into considerations the degree to which the item that qualifies for the scheme is employed for non-business or business ends.
The typical adjustment period is:
Ten consecutive intervals in the instance of part of a building, land, civil engineering or part of civil engineering works.
Five consecutive intervals if the item is a boat, ship, aircraft or other vessel or computer or related computer equipment.
Nonetheless, the intervals may vary, for instance if a business owned an asset before registration then registers for VAT, the first interval will be deemed to have started on the day of first use of the capital item and will end before the beginning of the following tax year. The tax year typically ends on 31st March, 31st May or 30th April and is 12 months long. The HMRC will allocate the VAT periods as it sees fit for each business. First interval VAT is computed according to the typical partial exemption regulations.
Subsequent intervals will typically run for a year. Where the degree to which the item may have been employed in the production of taxable supplies in a succeeding interval goes lower or higher, from the degree to which it was employed at the time of the original claim of the input tax was calculated using partial exemption regulations, the tax would have to be adjusted. For instance:
The acquisition of property results in VAT of £300,000 and 10 years is the adjustment period. According to the partial exemption recoverable ratio, 60% of the VAT will be recovered in the first year, and hence the recovered VAT is (£300,000 x 60%) = £180,000.
The business will then have to work the VAT for each subsequent interval using the initial VAT amount of £300,000. They will then use the difference between 60% which is the initial recovery rate and the subsequent recovery rate. For instance, subsequent recovery in the second year is 70% which means that the business may reclaim £300,000 ÷ (10 x 10%) which comes to £3,000. In the instance of the percentage in year two being lower than the initial 60%, the business would have had to pay more VAT rather than recover amounts paid.
DO YOU NEED TO FILE SELF ASSESSMENT TAX RETURN AS A COMPANY DIRECTOR
Are Company Directors Required to File Tax Return in Self Assessment?
The subject question has had contradictory answers for many years. HMRC have maintained that tax return has to be filed by all directors quoting certain sections of the tax guidelines. However, the same guidelines have other sections which clearly exclude directors from the responsibility of filing tax returns in normal scenario. You need to dig deep into the tax laws in order to find out the correct answer. While HMRC have persisted with their stand, the position has been challenged with success in various tribunals.
Company directors have no separate category as such. They fall under the same provisions as all other employees. If all your income has already been taxed at source and you have no other major income amounting to more than 2500, you don’t have to file tax return if you have not been issued with it. You can yourself check whether you are required to file tax return or not using the tool for self assessment updated by HMRC. The tool offers a set of simple questions to you, which when answered lead you to the logical decision.
One important point in this regard is the first question that you get from the tool. It may be reworded, but basically it asks you, “whether you were working for yourself or not”. If you were a director during the tax period, you must give “yes” as the answer irrespective of your stakes in the company. This is so because as the director, you are the boss and even though you are getting a salary, the same comes to your account only after tax is deducted at source. The subsequent questions are quite simple and easy to understand. Just answer them and you will get the decision whether you are supposed to file tax return or not.
Actions on Receipt of Notice to File Tax Return from HMRC.
If you are the company director and have no other major income that falls under taxable criteria, but have received a notice from HMRC for filing tax return, you need to act immediately. If you feel that you don’t have to file the return, you should write back to HMRC requesting them the withdraw of notice. If you fail to do this, you are liable to be penalized for not filing even if no additional tax is due on you. You should contact the GM with your UTR (Unique Tax-payer Reference) and NI number for an early resolution.
Procedure for Filing Tax Return. Get yourself registered online for self assessment. This may take about 10 working days for setting up the initial account before the return can be filed. The balance process for filing tax return is the same as for other individuals and is fairly simple. If you don’t have sufficient time to set up your online account and the deadline is closing in, you should opt to get your return filed through A tax consultant. Timely action is required in order to avoid penalties for late filing.
GM professional are specialist in personal tax returns , we can assist you in your filing and help to make the process simple. We have offices located in London, Manchester and Essex.
Taking Specialist advice when starting an E-commerce business is important. It can be challenging to select which platforms to trade on as there are a wide range of platforms. It is important to get your tax affairs in place before trading. As you have options on a few different type of structures, you can choose to trade as a limited company, sole trader, partnership and a Limited liability partnership.
This will be dependent on your profit, but a sole trader is a simpler model and costs less to operate. But with a limited company, you will benefit from the veil of corporation (protection against your personal assets). A limited company may suit you if you are in employment and have this as a secondary income, you can take advantage of withdrawing dividends at a lower rate than employment income.
What challenges will you face?
If you are importing stock from overseas , then you will need to ensure that you have an EORI number to allow stock to be collected. You may use an agent to collect and ship your stock. If you have decided to be vat registered then it is important to work out of your place of supply. As the vat treatment is dependent on the place of supply, if you are trading on platforms that ship your stock to other European countries, then you will need to assess whether these are distance sales or if you need to be Vat registered in that country.
What tax planning ideas can you take advantage of?
Its important to assess whether the expenses you are incurring are remote to the business and don’t have a dual purpose. HMRC defines this as wholly and exclusively for business purposes. Apportionments will be needed if the criteria is not fulfilled.
If you have full personal allowance then you can take advance of the small salary and divided strategy which is the most tax efficient strategy for small businesses.
Plan for Action
1) Market research
2) Hire a good accountant
3 Form a structure as explained above
4) Tax planning
5) Prepare for Vat and accounting deadlines
GM professional accountants are highly rated as we specialise in this sector and provide specialist advice on all forms of tax and vat fields. Speak to one of our tax experts and we will ensure that you are guided efficiently through the whole process. We have office is London, Manchester and Essex.
Selecting a good tax adviser can be difficult as well as prove to be expensive. However, if you consider the
following points, you can make an informed decision :-
(a) Experience. This is a key factor in making the right selection. An adviser with previous experience in the field can help you save a lot of money through his/her counsel. A tax consultant who can undertake bookkeeping, audit and is proficient in corporate or personal tax regulations can setup and manage your accounts in such a manner as to reduce your tax outflow. Experience in payroll services, tax investigation, VAT submission and landlord support along with the knowledge of current tax regime is an important parameter.
(b) Trust. It goes without saying that trustworthiness of your tax consultant can never be overemphasized. You can’t be sharing your personal and financial details with someone, whom you don’t trust.
(c) Qualification. If trust and experience are the 2 most important attributes, you can’t overlook the qualification of the tax adviser. A highly qualified tax consultant may seem to be expensive at the outset, but will ultimately be able to save you more money in the long run.
(d) Integrity and Transparency. You should select a tax consultant, who scores very high in integrity and informs you about all of his/her charges upfront. You should discuss the fees and costs of tax consultancy services with the adviser and an agreement must be reached. This kind of transparency is not only good for your business, but also aids in developing a healthy professional relationship. A consultant who commits to have a fixed fee structure is the best as you don’t have to spend time again and again on the same discussion.
2. HMRC approved (registered) accountants.
Tax planning and timely and accurate filing of tax returns are very critical for any business as well as individual. The rulings and procedures are often confusing. We at GM PROFESSIONAL ACCOUNTANTS provide you an end to end solution for this and are registered with HMRC as agents. With commitment to the job and knowledge of all tax related matters, we’re among the foremost Tax Advisers in London.
3. GM PROFESSIONAL ACCOUNTANTS – The Right Choice.
Whether you’re an individual tax payer, proprietor of a trader firm or big business organizations looking for the best suited tax advice, GM PROFESSIONAL ACCOUNTANTS meets all your needs. Our bookkeeping services are arguably the best in the market and you’ll never have to worry about any wrong or inaccurate entries. With years of experience, we’ve earned more respect than profit because we put faith and integrity as our topmost goals.
There are broadly 3 ways to manage your accounts and undertake tax management. First is that you do it yourself, which is perhaps the cheapest option but involves lot of hard work on your part. The second method is to take help from an acquaintance, which will have no guarantee of success. The last method is to hire a good tax consultant and although it may seem to be the most expensive method, it saves your hard- earned money. A bit of research can assist you to get the best quality tax adviser at reasonable prices.
GM Professional Accountants have offices located in London , Manchester and Essex.
If you earn more than 100,000 annually, you need to file your assessment tax returns with the HMRC. If you have not been sending your tax returns, you should register by the 5th of October after the tax year in which the income was realized. We can handle your tax returns and help you avoid penalties.
If you happen to be earning more than 100,000, you are classified as a high earner and the HMRC will be looking very closely at your money. Most high earners have more complexities in tax returns due to having more than one source of income. This calls for annual filing of self-assessment tax returns, which will ensure that all income is accounted for.
HMRC will also require that high earners file their returns since it can impact how much of your Personal Allowance will be tax-free. In HMRC language, this is what is referred to as the “adjusted net income”. The figure does not take into consideration Personal Allowance though it will comprise several types of tax relief. It boils down to a loss of 1 of tax-free Personal Allowance for each 2 over 100,000 of the adjusted net earnings. Things can get complex, which is why the HMRC requires that you file a tax return to make everything clear.
Can Submitting a Tax Return Result in Double Taxation?
You do not have to worry about double taxation as the HMRC will not tax the same income twice. However, it is easy to get it wrong if you are unfamiliar with the Self-Assessment system. There are many tax return deadlines and rules that come with Self-Assessment. You will have to register for it and you are likely to pile up penalties if you make mistakes in your filings.
Even if you somehow don’t fall into the pitfalls of Self-Assessment, you could still find that you are paying more tax than you should. Depending on the situation, you might get tax breaks on allowances that might be applied to the taxable income. Most people do not know how much they can claim for or may try to claim more too much.
What Information do the Tax Authorities Need? HMRC will need a detailed accounting of all your income and expenses. This will include information about earning sources such as share dividends, employment, pensions and interest among others. The authorities will also expect that you declare all employment benefits. The tax authorities will also expect that you declare your allowable expenses too. It can take some getting used to and dropping the ball is more common than you may think. Contact GM If you need any advice or help.
Absolutely! As some of the best tax specialists in the UK, GM Professional accountants provide Self-Assessment tax return services that will be excellent if you have complex tax circumstances. We will take it off your hands and work on your total taxable earnings and then file the returns for you. Our experienced tax experts will ensure you are in compliance with the HMRC regulations and save you money while at it. Contact us and learn how we can help you with your returns.
If you have children and have been getting Child Benefit tax breaks, you may have to pay back some of the benefits. The good thing is that there are morally acceptable and legitimate ways to reduce tax liability.
Child Benefit if you are Earning More than 50,000
If you or your spouse are earning an income of 50,000 or more in a year before tax, then the HMRC will expect that you pay back a portion or in some instances all of the Child Benefit that has to be declared in the form of Extra Income Tax.
What Happens when you and your Spouse are Making Less than 50,000 Annually?
In the instance that you and your spouse each make less than 50,000 annually, you will be eligible for Child Benefit and will not have to remit or pay back anything to the HMRC.
What Happens when either you or your Spouse is Making between 50,000 and 60,000 Annually
If either you or your spouse is earning between 50,000 and 60,000 annually, you will be expected to declare and pay back part of the Child Benefit you got which will now be deemed extra Income Tax.
What Happens of either you or your spouse is making more than 60,000 per year
If one or both of you are making more than 60,000 a year, then you will need to pay back the Child Benefits as Income Tax.
What Happens When a Spouse Moves In If you move in with a spouse that is earning more than 50,000, the tax situation will change. If you are earning more than 50,000 and your income is higher than that of your spouse, you will have to pay the tax charge. If their income is higher they will pay the tax charge.
How does it work?
Top tip One of the biggest benefits of claiming Child Benefits is the effect on your State Pension. This works if you are currently unemployed and happen to be at home looking after your child or children. Since you may not be making payments to National Insurance, the Child Benefits will be credited to your State Pension. You can always call 0300 200 3100 and talk to a Child Benefit Office representative if you need more information on how this works.
If you are being paid on a weekly basis the full amount of Child Benefits will still be paid to you every single month. However, this is only applicable if the amount of money you are making is below the 50,000 income mark.
However, things will typically change if either you or your spouse start making more income. For instance,
if either of you starts getting more than 50,000 a month, the HMRC will expect that you pay more Income Tax. The reasoning for this is that you will need to repay part of the Child Benefit that you are no longer eligible for.
The HM Revenue and Customs authority (HMRC) requires that you file a Self-Assessment tax return. This makes it possible for the HMRC to determine how much in extra Income Tax you should pay.
How to choose an Accountant for your small business
Selecting an Accountant for Your Business
Business and tax affairs are sometimes complicated and hence the choice of an accountant is critical, whether you are an established company or a new business. The best accountants will typically have the necessary qualifications, and be members of a regulatory and professional body. Such accountants is good for your business since they have not only the practical experience but also the technical expertise in the field.
A good account is one that is suitable for your business and also for your individual needs. As such, whether you are seeking qualified accountants in London or any other location in the United Kingdom, it is absolutely critical to be very careful. Take your time rather than engage in the last-minute rush when the deadline for filing your returns is imminent. When selecting accountants, ensure that the firm has the necessary skills and experience in your industry. The best way to determine their experience is if they have clients that are of the same size and are in the same industry. Such a firm will understand the types of issues the business is likely to face. GM professional accountants work in a number of sectors and are awarded the tree best rated accountants.
Why Get a Licensed Accountant for Your Business
1. They will handle the tedious activities of account preparation so that you can have time to take care of other important activities. 2. Help you to be more efficient in structuring your tax obligations 3. They offer specialized tax saving advice 4. Help you secure funding and loans critical for the growth of the business
Where to Hire a Highly Qualified Licensed Accountant in London
You can always start with asking other people for recommendations though you will still need to ensure that your recommendations are a proper fit. A friend of a friend in your locale might have been great at helping file individual tax returns but they will not cut it if you are a fast-growing business in London.
You should also take into account the benefits of hiring an accounting firm. You will always have someone to step into the gap and take care of all your accounting needs whenever an urgent matter comes up or when your dedicated accountant is on holiday or otherwise incapacitated. A firm will also have accountants with a range of specializations and experience should you need it. However, you should find a firm that is not too large that it is impossible to speak to the same person whenever you email or call in. In an ideal situation, you want a firm that gets you a dedicated accountant that will come to learn how your business works and also build a working relationship with you. Since they will have an intimate understanding of your business they will be able to give highly relevant advice to you.
Critical Things to Take Into Account for When Choosing an Accounting Firm
1. Dedicated accountant for your business 2. Fixed fee options so that you can control costs 3. Have clients of similar size and industry 4. Local accountants that you can meet for one on one meetings
Having fixed fees is particularly critical especially if you are just starting out and need to know the exact costs of accounting services. GM Accountants are located in Ilford and central London and provide fixed price accounting services if you need such services. You get a range of pricing option for anything from basic service to one on one meetings or regular phone support depending on your needs and budget.
GM Professional accountants have offices located in London, Manchester and Essex.
The estate of the deceased will typically have to pay tax prior to any division of money to their heirs. You may not have to pay tax immediately after you get your inheritance, but tax obligations might arise down the road. Here is a handy guide on when and what to pay in taxes in the instance of death.
1. Work out the Income Tax obligations up to the day of their decease 2. Complete tax returns 3. Pay tax on any income that the estate receives 4. Determine if the estate needs to pay any Capital Gains Tax 5. Calculate the Inheritance Tax and determine who is responsible for it 6. Determine if you have to pay any inheritance tax
Work Out income Tax Obligations till the Date of Decease
It is possible that the dead person may have paid too little or even too much Income Tax. This might mean that the estate might owe or be owed a tax refund. To ensure that the Income Tax paid is in line with what is owed, you need to contact HM Revenue & Customs (HMRC) who will adjust the tax calculation and make it right.
If the dead person was resident in Wales, Scotland, or England, you could use the Tell Us Once service to have the calculation reviewed. The Department of Work and Pensions (DWP) and the HMRC will then contact you with details about the entitlements, benefits, and tax regarding the dead person’s estate. If they were resident in Northern Island, you can call the Bereavement service, which provides a toll-free number (0800 085 2463) for any queries on a deceased’s estate.
Completing their tax return
If the deceased used to complete a self-assessment tax return you might have to do it too. If you decide to use the Tell Us Once service, the HMRC will contact you in case you need to complete the self-assessment tax return.
If you cannot tell if the dead person regularly filed their tax return, consult the HMRC, which will furnish you with the information on how regularly they did so including the last time they submitted their returns. The HMRC will need you to have the National Insurance number of the deceased before they can provide you with the information you need.
For some professionals, working overseas is a critical component for the growth of their careers. This means that such persons may over the years accumulate significant retirement savings abroad. The big question is “How will these retirement benefits and pensions be taxed once they come back home to the UK to retire?”
The tax obligations could vary depending on how much a person accrued in retirement benefits and savings during that time and the country where they accumulated such savings, the type of retirement provisions employed and the manner of distribution of such benefits. You may have pensions in the US or Europe and its important to assess the tax and look at tax planning solutions before making that choice.
Combined with the fact that there have been changes made to the tax obligations for persons with non-UK retirement benefits, things have become more complicated.
Determining the Nature of Payments
Before providing any advice, the first thing the adviser needs to do is to determine that nature of the client’s benefits. This article analyzes the treatment of pension earnings made while a professional is working abroad. However, it is possible that such a professional might also have other income while they are in retirement.
Different jurisdictions have different ways of encouraging people to save for retirement and not all of such schemes may have the structure or characteristics of what would be considered a pension scheme in the UK.
In some countries, the benefits may include end of service awards, savings schemes or deferment of receipt of employment income. All of these may be treated differently in the UK when they are declared as pension benefits.
The second part of this article makes the assumption that any of the retirement benefits the professional is earning come from a regime that may be regarded as a pension scheme in the UK, even if it is not registered.
Taxation of Lump Sums from a Foreign Pension Scheme
Generally, a person resident in the UK would have to pay income tax on any lump sum payments they get from their foreign pension scheme.
By and large, such lump sums will be fully subjected to income tax regulations.
While the basic premise is that the lump sum will be subjected to income tax, there is need to take into account exemptions that may reduce obligations, given that the professional accumulated the benefits when they were not living in the United Kingdom.
Reduction of Obligation for Foreign Service You could get a partial reduction or complete exemption of income tax obligations for pension savings that a person might have accrued while working abroad in the Foreign Service.
The FA of 2017 made recent changes to relief for Foreign Service workers and the details of these changes are set out below.
Getting Relief through Invoking a Double Taxation Agreement
The United Kingdom has many Double Taxation Agreements (DTAs) with many countries and these DTAs have articles governing how pension income will be taxed. The pension article in a DTA will typically grant taxation rights to one country and exclude the other. As such, it will be critical to establish when and where the individual was resident in when the pension benefits were accumulated, and what the DTA stipulations say regarding the tax obligations on their pensions.
As we are now moving towards digital technology, people can now operate tasks from home. With Video recording and digital signatures , the need to go the accountant has become less popular. There are still benefits of face to face meeting as this form of communication is far superior and better for undertaking.
GM professional provide accounting and tax services in selected areas and can also assist you with the latest technology to provide you with the same experience. We provide Self assessment tax returns services, Limited company accounting services and tax advisory services.
Communication is the key when you have an accountants that is virtual. Here at GM, we have the systems and the software, this allows you review information an d sign the necessary forms online via software. This all can be done from your home without visiting our offices. We have robust email service that you can rely on.
GM professional accountants provide these services around the London and Essex area, we have a specialist team that has the experience and expertise to take care of your tax affairs.
Where a non-domiciled individual has not been UK resident in previous tax years (or, if UK resident, has been resident for no more than the previous two tax years), general earnings arising in the following tax year which are not in respect of UK duties of the employment, are taxed on the remittance basis only.
Remittance basis generally
For non-domiciled individuals who are not ‘long-term’ residents of the UK (that is, they have been resident for less than seven out of the previous nine tax years), the remittance basis of taxation is available with respect to their other overseas income and their overseas gains, and this can be enjoyed without having to pay the ‘remittance basis charge’ (a sum of £30,000 upwards per tax year).
Where the remittance basis applies, such foreign income and gains are charged for a tax year only on so much of such income or gains as are remitted to the UK in that tax year. The meaning of ‘remitted to the UK’ was significantly tightened up in 2008.
In most cases, the individual has to make a claim for the remittance basis to apply.
There are certain exemptions or reliefs available, in particular ‘Business investment relief’ which was introduced from 2012. This permits monies to be brought into the UK for the purposes of acquiring qualifying business assets, without such amounts counting as ‘remittances’ for tax purposes.
GM Professional Accountants have office in London, Manchester and Essex.
Starting an Amazon FBA business can be challenging. It’s import to assess whether you will need to register for vat. This is an important stage and the correct decisions will need to be made. The best vat scheme will need to be selected and you will need to keep records in MTD format and software.
This will depend on your location. UK companies have a threshold of 85,000 on a cumulative basis. This threshold does not apply to businesses outside the UK. You may need to register for vat on the onset.
There are few schemes for vat. This will depend on your purchases. You have the standard rate vat scheme and the flat rate vat. With the flat rate vat scheme, there is the limited cost trader rule which will negate the benefit of the vat scheme
Amazon business owners will need to also differentiate between customers, Businesses to business and business to consumers . As the vat treatment can be different if you are selling outside the Uk.
An EC sales will also need to be done with the vat returns.
GM professional accountants specialise in the E-commerce sector. This ensures you are compliant and up to date with latest changes. Our experts help you select the schemes that benefit your business. We help you understand you obligations and fulfil them in a timely manner.
GM Professional accountants have offices located in London, Manchester and Essex.
More often than not, a divorce will result in assets being transferred from one spouse to another. Read on for a better understanding of the application of CGT, including how and when it is used. You may need to produce a capital gains tax report for the court.
When a marriage breaks down, no one ever thinks of the tax obligations that may arise from subsequent happenings. However, it is important to do some tax planning as this can have some significant benefits for both parties.
Taxation of Chargeable Gains Act 1992 Section 58 has the provision asserting that if civil partners or spouses that happen to be living together transfer assets in a tax year, the transfers are deemed to be made on a no loss/no gain basis.
The implication is that the person who receives the asset will be treated like they paid an amount equivalent to the total of the original cost of acquisition.
Transfers between Spouses in the Year of Separation The no loss/no gain treatment is also applicable to transfers between civil partners and spouses for the remainder of the year that the separation is reported, even if the civil partners or spouses may not be living together when the transfers are made.
If dissolution of a civil partnership or a divorce happens in the same year in which the separation was reported, the no loss/no gain treatment is applicable to all asset transfers made after the dissolution or divorce as long as they happen before the end of the tax year.
The ICTA 1988/S 282 defines living together. A woman is deemed to be living together with the husband unless she can show that (a) she separated in circumstances that are likely to make the separation permanent (b) she has a formal deed of separation (c) she separated under a court order.
According to the ruling in Holmes v Mitchell STC 25, a couple may be deemed separated even if they still share a residence. For instance, when financial considerations make it impossible for one civil partner or spouse to move out or when the parties desire to minimize the initial harm that could be inflicted on the children.
Conclusion In conclusion, capital gains tax on transfers between civil partners or spouses is not payable in a year in which they still live together. This will still be applicable for the entire year in which they got separated. You may have to pay capital gains tax if the asset transfer is done in the year following the separation. The assumption made in such an instance is that the transfer is made at market value. The reasoning for this is that the spouses are still connected to each other until the provisional decree of divorce is proclaimed.
In an ideal situation, the asset transfers if they may attract chargeable tax should be conducted before the end of the tax year of separation. In an instance in which asset transfers could result in tax liability on capital gains, a transfer made in different years may be the best option. The reason for this is that you can reduce the
total payable amount since you get to enjoy two annual exemptions. If the transferor civil partner’s or spouses capital gains tax are likely to be lower in a given tax year as compared to another, then delaying, accelerating or asset transfers could be one way of improving their capital gains tax position.
GM Professional accountants have offices locates in Manchester, London, and Essex.
Online shopping is one of the most developing segments in business. The development of online shopping has led to the creation of more jobs. One of the tasks that online shopping has created is courier freelancing.
How To Become A Freelance Courier
The first thing you need for you to work as a freelance courier is a van. You can use your van, or if you don’t have, you can hire. A freelancer courier can take jobs from courier companies like UPS or FedEx. Also, if you are capable, you can begin your own courier company.
Pros and Cons of The Two Courier Options.
– If you have to work under any other courier service as a freelancer, you will have no worry about how you will source for clients. However, your agreement with these companies will always tie you down.
– If you begin your own courier business, you will have the freedom to choose the clients you can work for, and you will put in a lot of efforts. Your inputs either hard work or finances would determine how many clients you will get.
How to Advertise Your Courier Services
Are you planning to begin your own courier services company? There are a few tips that may be helpful you can use to get clients. Some of the techniques are:
– Develop a website. Developing a professional website will help in boosting the credibility of your company. You can list your services on the website and also the prices for your services. Also, the site is a good point where you can communicate with your clients.
– Social networking. There are a lot of social media platforms with steady users which you can use to grow your business. You can run adverts on these platforms where you can target individuals looking for freelance courier services. You can use Facebook, LinkedIn, Instagram or Twitter to create your market base.
– Business cards. A freelancer can design and printout business cards. The cards should show your services, names and also contact details. You can then give the cards to your friends, family members, and even potential clients.
– Create adverts. Not everyone uses social media. You can use local advertising as your medium of communication. Adverts are cheaper and quickly meet your target audience.
How To Become Better in Your Courier Services
If you begin your own courier company, the better you are at your job, the chances of getting more clients are higher. Some of the skills that some of the best couriers have are:
– Stick to deadlines. Once customers purchase or request for goods, they usually need them in a short time. Due to the loads of packages you have to deliver, it would be wise to create a plan which will allow you to
stick to their schedules.
– Have adequate knowledge of the streets. In case your navigation system breaks down during your deliveries, you need to have sufficient experience of every street. It will help you to keep time even without a nav system.
– Stay fit. Since you will be spending a lot of time sitting in your van, you need to be healthy. Also, you will need to be fit for you to load and off-load your van.
– Be a good driver. This is one of the essential requirements that you need. You should have a valid driving license and also stick to the Highway Rules.
Accounting as a Courier.
There are a lot of benefits that you will enjoy in being a freelance courier. However, as a freelancer, there is one major challenge which is accounting. If you are employed, your tax is taken care of in the PAYE form. As a freelancer, You have to prepare your financial records and pay for the Self-assessment tax return. It’s done annually, and it may be challenging for you. It can distract you from your busy delivery schedules.
Getting Accountancy and Tax Advice.
You can contact GM :Professional accountants to prepare your the financial records at the end of the year. We specialise in this sector and provide bookkeeping, tax return services and company accounting services. For the courier agency to operate smoothly, we will provide general tax advice on accounting and tax returns. It will be perfect if you keep your records up to date each month as this will allow you to make an informed decision.
If you intend to be away for a few months or even just a few weeks and intend to work while abroad, then you typically will not have to deal with issues with regard to tax.
But if you intend to move for a period of three years or more or even permanently, you are going to be treated as a non-resident person right from the day you leave the UK. Once you are no longer deemed a resident of the UK, you will not have any tax obligations.
Things get more complex if you intend to visit the UK frequently while living abroad. If you have such intentions, the HMRC will deem you a resident expected to pay tax unless it is determined that your visits to the UK are less than:
1) 183 days of a tax year 2) An average of 91 days every tax year over a four year period
In addition to this, the HMRC will take into consideration several other factors such as:
1) Your ties to family 2) Memberships to UK societies and clubs which can prove social ties 3) If you still maintain a house in the UK 4) Whether you still retain work ties such as directorship of your limited company
It is important to note that the 91-day residency test can also be determined through qualitative analysis. These may include aspects such as whether or not you purchased properties in the foreign country you currently live in. If this is deemed insufficient as proof of change of residency, you will be treated as a UK resident for at least three years before your circumstances are reviewed again.
The implication of this is that you may have to pay taxes on capital gains and income on an adjusted basis if you spent a significant number of days in the UK. This is what is referred to as split year treatment.
This can be a particularly significant thing to note, especially if you also have to pay tax in your current country of residence. Given that each country has its own laws on tax and residency, it is advisable to always find a professional tax accountant to give you advice on how tax in your country works.
You also need to remember that you have to apply for the relevant visas if you are residing in a non-EU country. This is usually so if you are on a tourist visa and you intend to stay for more than the typical 90 days allowed.
Residency laws tend to be very complex and hence if you are not sure if you are classified as a UK resident or not, you need to speak with a specialist who knows these things. “Am I a UK Tax Resident” is an
excellent piece that should get you up to speed on how tax and residency in the UK works.
Finally, you will have to take into account your expenses and how the implications of these on your options. If you are going abroad as part of the fulfilment of a contract, then you can claim from your limited company expenses such as hotels, flights among other things.
Nonetheless, if you are just doing a little work while on holiday, you cannot claim any expenses for that.
The tax status of expatriates is one very complex issue. If you are not meticulous with your tax planning, you may find yourself subjected to punitive tax obligations. In addition to having changed your UK tax status, you will also need to take into account the tax laws of the country where you now live.
Statutory Residence Test
First, you will have to take into account the new expatriate benchmarks as set out in the New Statutory Residence Test, as set out by the tax authorities.
A good understanding of how it works will be helpful to help you determine:
1) How any income from your investments in the UK will be treated 2) The Capital Gains and Inheritance Tax rules 3) The consequences of selling any of your assets in the UK (such as stocks)
As such, you need to have an expert review your contracts to determine what aspects of your income are impacted by the change in tax status.
Expatriate Tax Advice if you are leaving the UK
Once your tax status is established, the professionals will assist you with planning your financial affairs so that you can minimize your tax obligations. Areas that would need to be taken into consideration include:
1) Advise on how tax would be treated in your new overseas resident country and in the UK. 2) Inheritance Tax planning 3) Taking into account efficient asset disposal 4) How to deal with investments
Tax Returns as a Non Resident
In addition to tax planning, you also need to know your filing obligations for both your new residence country and the UK. We can help you stay compliant and avoid any liability by making sure that: 1) All tax returns and obligations are documented and, 2) Filled out accurately and 3) Filed in a timely manner so that you do not have to pay any late filing fees
Tax Planning when you come back to the UK
This will be the complement to tax planning when you are leaving the UK. You need to take care of similar issues to make sure you avoid any pitfalls and lessen the amount of tax you have to pay.
Expat Tax Extenuation Professionals
We have specialist tax professionals who provide advice to expatriates on how to perform efficient tax planning and on tax mitigation.
GM Professional Accountants have offices located in London, Essex and Manchester.
Will Shu the founder and also the CEO of the Deliveroo received motivation after his amazing journey to a great city that was endowed with rich restaurants but they only had one shortcoming! most of these rich restaurants could not really do the food delivery. Will Shu decided to initiate the best local restaurants that could deliver foods to the client s doors.
Deliveroo has since seen a greater growth that’s is approximated at 650% following its convenient and the most reliable food deliveries! Customers can really get their full supply by just making a call. The restaurants partnering with this amazing company has also seen the growth of over 30% and has really done great in creating job opportunities for the people.
Independent self-employed drivers sometimes find it difficult handling issues of the tax. Some drivers are really not educated on the bookkeeping and also the taxes and sometimes they pay the excess or even subjected to some penalties.
All these issues can be really sorted out when a proper accountant who understands s the tax mechanism is employed. You can always contact us for assistance.
Four major bookkeeping requirements for efficient Tax management;
1. The deliveroo driver must have the register with HMRC using there website as self-employed
2. The second step is to ensure that business transactions documents such as the receipts and the expenses are just kept for the year end.
3. The Deliveroo driver should also ensure that they do the self-assessmen tax return which consists of the income and expenses before 31st January of every year.
4. Other liabilities such as the pending tax or the national insurance must be paid before the 31st January every year.
Drivers of the Deliveroo are entitled to some allowable expenses which have really done a lot in reducing their tax bill. Taxes are always paid on the amount that is left after subtracting the allowable business expenses. They include;
Mileage claim is always entitled to the drivers who own a car. When the claim is made, the eligibility to claim for the cost of the car, servicing and also the insurance is canceled. The first 10,000 miles attracts the rates of 45p and then after which it attracts 25p thereafter.
Purchasing a new vehicle will actually make you liable to claim all the cost in a few years with the following rates; up to 130g/KM will entitle you to an 18% capital allowances while those that exceed 131/KM will entitle you to an 8% capital allowance.
Car Lease payments
There is also an allowable deduction for the car lease at whilst working as a Deliveroo driver. You can always deduct the amount that is obtained from the cost of the lease, insurance and also the repair cost every month!
Service charges and commission at Deliveroo
Deliveroo drivers can claim deductions for the following services; Tolls and parking charges, insurance, the bank charges, car cleaning, accountants fees vehicle and public liability fee.
Finding a good accountant for your business
Finding the best accounting firm has always been an easy task following the large variety of accounting firms that really offer the same service. They offer the accounting services to the Deliveroo drivers who find the accounting work tedious. GM professional accountants has played an important role in providing deliveroo drivers with mobile apps that enables them recording of the daily transactions.
Among the key roles played by the firms are;
1. Create a Self assessment record with HMRC 2. Are responsible for the bookkeeping and accounts to judge the real profit of the driver. 3. Provision of the mobile Apps that will enable the drivers to do record keep 4. Keep track of all the business expenses and also the income. 5. Keep a record of all the vehicle details such as the mileage. 6. They also provide the preparation of accounts for filling to HMRC
Other roles are the bits of advice on the importance of the record keeping and also they do help in issues that prevent a tax investigations.
For the individual accountant, it can go up to 250 GBP while companies may cost more than 600 GBP. It’s always advisable to check the ratings of any accountant before hiring.
Making tax digital (MTD) is a huge project by HMRC and it applies to businesses, sole traders and landlords. The aim of this project is to maintain accounting records using computer based software. This data will inform HMRC about the income and expenses every quarter.
There has been a revised plan in the finance bill. Under the old plans, landlords and businesses that have sales over £10,000 would have needed to submit quarterly returns. The businesses that are vat registered also would be required to submit from April 2018 and businesses that are not vat registered would have to submit by April 2019.
The treasury has amended the plan and the requirements since then, as the previous timetable was not practical and they considered the opinions of professionals in the accounting field.
Under the new plans the following will apply:
Only Vat registered businesses will need to keep digital records.
This will apply from April 2019
Non vat registered businesses will not need digital records until 2020
HMRC have opened the pilot scheme which will enable businesses to test and use the system.
Which software will you choose?
If you are still using spreadsheets, then now is the time to stop and choose a software package. There are a number of cloud based software packages. Majority of these bookkeeping packages will use bank feeds. This basically means the bank transactions will automatically feed in to the software which ensures the accuracy of the data and also saves time.
How to store your records?
You may choose cloud based storage or you can choose from the latest camera and scanner application that directly feed into your bookkeeping software. It is important that you have a system in place that is secure and is backed up. There are benefits of using digital technology but also drawbacks such as losing the data if this has not been backed up.
Why Choose GM Professional Accountants as your MTD Accountant?
GM Professional accountants are experienced in making tax digital and we have our own dedicated software that will meet the requirements of your business. We have applications that can be used from your phone or desktop to keep Digital records which saves time and is efficient. We understand that moving to a cloud based software may seem difficult. This can overcome by the right guidance and management. GM professional accountants can assist you in preparing for MTD and can help you at every stage. From knowing when your reporting period is starting, what software packages to invest in and how to keep your records secure. These are important stages as you can over spend on features that you may not need. These can be packaged under different price plans, you will need to know whether you are choosing the correct one for your business.
Call GM professional Accountants today and we can assist you in making tax digital a simple process.
Call us on 0208 396 6128 to speak to a tax expert.
When choosing an online accountant, it’s important to get it done right. We will explain the process on what to look for. It’s important to choose a specialist and an accounting firm that is experienced.
What to look for in a good online accountant?
Looking for a good online accountant should not be very expensive, but you will need to take a few points into consideration.
When choosing the best online accountant, you should look at the experience of the accounting firm. You will need to look to see if they are registered agents with HMRC. This is important as an experienced firm will have controls and procedures set by the accounting bodies. Furthermore, it’s important to know whether they specialise in your field. You may be self-employed or a limited company. This ensures that you are gaining the maximum benefit of that service by an expert. Experienced will have CPD, which ensures they are up to date with the latest budgets and tax changes.
This is an important factor, as you will provide them with sensitive information such as your passport and bank details. You should enquire to see if they are registered with the information commissioner’s office. This will confirm if they have controls in place to comply with the standards. It is important that you are comfortable and can trust your accountant.
When choosing a good online accountant, it is important that you conduct enough research, looking at the first website and hoping for the best may not be a good idea. You will need put some time and effort to know the firm and to see the qualification of the person you are dealing with. The other important factor is to see experiences of others. This can be done by checking their reviews and understanding the level of service that is being provided.
Transparency and Integrity
When choosing an online accountant, it is important that the accounting firm is straight forward and honest on the fee structure. This should be discussed at the beginning of the engagement and engagement should be signed by both parties in order to avoid a dispute later.
Why I Should Hire GM PROFESSIONAL ACCOUNTANTS as my online accountant.
GM professional accountants are bound by the professional ethics as discussed in this article. Our 5-star reviews have resulted in us being the three best rated accountants in our area. This gives our clients confidence in our services and in our ability. We are a respectable and honest company which is built on trust and integrity to provide the best possible professional service.
We specialise in accounting and tax, which ensures both fields are covered. Our current client base ranges from freelancers, contractors, landlords, small limited companies and many more. General tax support is included in all our packages; this is our speciality and an important factor throughout our relationship. This provides confidence that you are not overcharged for a service. The fees range from £25-£70 plus vat per month, which depends on the type of structure and services you require.
Call us today for a free consultation on 0208 396 6128
Vat can be be complex for small businesses. As this is a broad field and specialist advice is need to make an informed decision.What to claim as input vat and what type of scheme you will select are some of the common questions.
We ensure that you have enough information to Make an informed decision and understand the complexities.
VAT is a complex tax and HMRC threaten penalties for any errors; let us guide you through the maze of regulations. We work with you to ensure that you understand VAT and its impact on your transactions, assisting with:
International vat rules
Completing VAT returns on your behalf.
International vat is an area where most small businesses need advice. Cross border transanctions between the EU and outside the EU have different treatments. With Amazon FBA small businesses now expanding , the place of supply is an important factor on the vat treatment. The place of supply is different for Goods and services and also treatment to businesses and consumers. There is also distance selling rules which can impact you significantly if you cross the threshold. The types of scheme such as the flat rate scheme have been impacted by the limit cost trader rule. This has now made businesses use the 16.5% with 1% percent discount in the first year.
Zero rated, Standard rates and exempt
It can be difficult to identify the vat treatment for products and services. This can also impact whether you can claim the input vat or not. GM professional Accountants are vat specialists and provide a wide range of services on vat. We provide comprehensive information, this ensures that you are comfortable and In control of your business.
Call GM professional Accountants today on 0208 396 6128
Our offices are located in London, Essex and Manchester.
Income tax can be payable on foreign income, the common types of income that are taxable in the UK are foreign interest on savings, employed or trading income from abroad, rental income on properties located outside the UK and income from overseas pensions.
Foreign income is considered to be anything from outside Scotland,England Northern Ireland and Wales.
How to calculate what you need to pay
The first thing that you need to identify is whether you are resident in the UK. If you are not considered resident in the UK then that means you do not have to pay tax on foreign income. There is also double taxation treaties between the UK and some countries , this ensures that you are not taxed again for the same income. If you have already paid income tax or capital gains tax on overseas employment inc0me or gains, then you may apply for foreign tax credit relief if there is a double taxation treaty. you will still pay up to the UK limit and will not receive a refund if you have overpaid.
Filing your Tax return on foreign income
You will need to register for self assessment and there are deadlines to register depending on the tax year. Example, if you had income to report on the 01/07/2017 , then you will need to file the 2017/2018 self assessment tax return and the deadline for this is 31/01/2019 (electronic returns). You will need to notify HMRC latest by the 05/10/2018 in this example. once you have registered , you will recieve a Unique tax reference number (this can take up to 4weeks). This number is important, without this number you will not be able to file your tax return. GM professional accountants specialise in foreign income tax returns and have tailer made tax planning solutions. This ensure you are in safe hands and are getting expert advice.
GM Professional accountants have offices located in London, Manchester and Essex.
Key points on how to file your self assessment tax return 2018-2019
Deadline to register
Its important to understand that you will need to notify HMRC before the 5th October if you need to file your tax return 2018-19, Otherwise you may incur a penalty. You can register online or by paper, the online method is usually quicker, the UTR number can take up 4 weeks to arrive in the post. You cannot file your tax return if you have not received your Unique tax reference number.
Information needed to file your tax return
The information you will need will depend on your source of income.
Simple income Tax Tax returns
P60 or P45
Property income Tax return
Rental income Statements
Mortgage interest certificate
Repairs and maintenance costs
Self employed tax returns
Capital Gains property Tax returns
Sales completion statements
Purchase completion statements
The information listed above is what you will need to complete the basic tax return and you may need other information depending on your circumstances.
Other information needed
The deadline to file the electronic tax return 2018-2019 is the 31st Jan 2020. GM professional Accountants can help you in the preparation and filing of your tax return. It is important to complete a tax return if you have been issued with one. If you ignore the filing deadline and do not file by the deadline. you can be looking at fines that can run into the hundreds.
You must submit your tax return by the 30/12/2019 if you would like the tax to be collected from your wages. The UTR number can take up to three weeks to afrrive if you have lost your number. Ensure you order this in time order file your tax return by the deadline. GM professional Accountants are based in London and Ilford.
If you run a limited company, there are a few financial things you need to understand to help you run your company better. One of these things is the director’s loan.
According to Her Majesty’s Revenue and Customs, a director’s loan is any money which you take from your company which is not;
Your wage, expense refunds and dividends.
Funds you have previously loaned or paid for your company.
Even though the money that is in your company’s bank account is not technically yours, you can have access to it through the director’s loan account.
Any time you withdraw money for any other reason, that money ought to be recorded in your DLA. Depending on your activities, when your company’s financial year comes to an end, the company will be owing you money or you owing the company money. This should be noted as a liability or an asset in your company’s annual accounts balance sheet.
The contents of a DLA.
These are the things included in a DLA;
All cash withdrawals that you made from the company as its director.
Individual expenses which you paid using the company’s fund or a credit card.
Business expenses are the type of expenses that might be incurred exclusively, entirely and necessarily during the executions of your employment duties. Anything else that does not fall under this is therefore a personal expense. Your director’s loan account should include evidence of all transactions which involve your finances, together with the company’s as well, to make sure that it will stand up to HMRC’s scrutinies.
Running your own limited company is to some extent risky, and that is the reason why HMRC will keep your director’s loan account under review through the yearly tax returns of the company to make sure that rules and regulations are followed to the latter.
Who is eligible to apply for a director’s loan?
Just as the title suggests, in order to be eligible to take a director’s loan from your company, you first need to be a director. There are several reasons why you would take a loan from your company, the important thing to know is that that loan has not been subjected to the company’s or your personal tax. If you pay the whole loan back 9 months to the year-end of the company, you will not owe any tax. However, if your DLA gets overdrawn at your company’s year-end, then you will be forced to pay tax.
For example, if you get a loan in March 2017, and the year-end for your company is April 2017, then you will have to pay back the loan by February 2019. It is important to know that any overdue director’s loan account will have to pay the tax at 32.5%.
Is it important to record the director’s loans?
When you started your limited company, you established it as a legal entity, so it is essential to remember that your relationship with your company is legally separated. This means that your company has its own statutory duties and responsibilities, that is the reason why any amount withdrawn ought to be recorded.
What if you owe your company money?
The moment you owe your company 10,000 or more, that loan is automatically classified under benefit in kind. Furthermore you will be forced to record it on aP11D since it will be liable to both your company’s and your personal tax. Other than that, you will also pay a Class 1A National Insurance at a 13.8% rate on the whole amount.
A written off loan.
The moment that your company decides to write off your loan you will need to consider taxes and accounting, it is advisable to consult an accountant so that he can help you decide on the next course of action.
Monitoring of the director’s loans by the HMRC.
It is part of HMRC’s job to monitor all the DLA’s which are frequently overdrawn. Sometimes it is possible for them to come to an agreement that the money should stop being a loan and make it your salary instead, therefore it is strongly advised that you regularly monitor your director’s withdrawals to make sure you don’t go beyond the 10,000 thresholds.
The residential property landlords now have the responsibility to comply with the new income declaration scheme. The payment of tax is an obligation that every citizen should meet in the United Kingdom. This noble cause prompts Her Majesty’s Revenue and Customs believe in the need for landlords should get the opportunity rightly disclose their taxes. Let Property campaign fills the gap by providing the necessary knowledge to people with income from property.
The main advantage you get due to voluntary disclosure is the favourable terms in the payment of the tax you owe. Notably, tax evasion results in penalties. Therefore, it is important to undertake a voluntary and full disclosure of the unpaid tax to benefit from the low penalty rates that are associated with it. Meanwhile, if you decide to wait for the HMRC to discover that you are evading tax, you will be dealing with higher penalties. The penalties can be 100% of what you owe. When you add the higher penalties to the likely cost of investigation , voluntary disclosure is far much cost effective to the landlord.
Why it is important to use a professional Tax Adviser
Landlords are susceptible to several tax errors which may be deliberate or due to misunderstanding. Our Tax advisers will help you to know whether the Let Property Campaign applies to you or not. There is an instance when you can be a landlord and you fail to realise. A simple misunderstanding of the rules that occur when you inherit a property or renting out your flat to cover mortgage payment is part of what makes one liable to unpaid tax. In such cases, a professional adviser will be helpful in attaining updated tax affairs.
Additionally, the Let Property Campaign has a wider scope. It varies significantly with the previous disclosure systems. This means you may not have a complete grip of all that is required of you in this regard. The professional adviser becomes handy in guiding you through the steps you need to follow based on your circumstance.
How far back do I need to go with my declaration?
The declaration goes as far as when you started receiving the letting income. It is important to keep a record, especially of the expenses as if you do not have the proof of these, then you will not be allowed a deduction. The Tax adviser will assist you between capital and revenue expenditure.
What happens if I cannot pay the tax?
If you cannot pay what you owe, you must contact HMRC before the submission of your disclosure. The HMRC will make decisions depending on your current financial position to advice accordingly. The Let Property Campaign is something to consider because payment of tax is an obligation to be met by every citizen.
GM Professional accountant are Experts in the Let property campaign procedure and the cost of our services is affordable. Our accountants are experienced in this field and ensure that you maximise on any allowances.
Our Offies are located in London, Manchester and Essex.
A considerable number of businesses will confront a regular tax investigation at any time of normal operation. More serious duty review is likely if HMRC doubts that your tax returns are incorrect. A tax investigation or inquiry is certain to be a very difficult and stressful situation which can be quite costly in the long-term to resolve if it takes a long time to settle. Also, if you find that you are overly distracted by an HMRC tax investigation, it is likely to cause difficulties in being able to properly concentrate on your day-to-day activities of running the business. Be free to take an expert advice where you can`t settle tax audit by your own just after it starts.
Likelihood of a tax investigation
You ought to expect regular tax investigation in case you are enlisted for VAT or other have workers paid via PAYE. The duty audits will inspect your records and frameworks, concentrating on commonly mistaken areas. Routine tax reviews are considerably less likely with regards to income duty or organization tax. Rather, the attention is emphasized on tax audits where HMRC has the motivation to trust you are either committing mistakes or intentionally concealing income. Normally, tax reviews can be done after a period of five years, while just a couple of per cent of wage duty and company tax return are investigated every year. Some of the most noticed reasons for the HMRC to start an investigation include records that differ vastly from similar business in the same industry, using round numbers on all entries and not the exact figures, unexplained or unusual fluctuations in the declared amounts, low-quality record keeping, a tip-off from a tenant or disgruntled employee, and certain high risk areas of business, such as construction or jobs that are likely to involve cash payments. Also, about three per cent of investigations is started on a purely random basis.
Tax investigation notification
The investigation process starts with the arrival of a letter from HMRC, indicating to you that an inquiry has been initiated into your financial affairs. Usually, you will be asked to clarify certain things and submit a few business records and therefore, you will need to take the right action to make certain this situation is resolved as effectively as possible.
On first getting the notification of being investigated you need to avoid getting into a panic and stay calm. Even in those situations where you have made errors on your tax return, you might still find that it is possible to rectify the issues by making any payments due as soon as possible. Unless a tax return features many intentional errors of a significant size, there are very few instances where a case ends with a custodial sentence. You ought to seek guidance soonest possibly after notice of a tax investigation. You might need to request that your bookkeeper checks your records and frameworks. The tax review will be snappier, easier and not most likely to prompt punishments if you can provide precise, updated data when the reviewer visits. It is best for you to get in touch with a tax audit specialist, who can guide you about the proper course of action to be followed from here. Quite often, expert help may lead you to identify oversights or errors on your part that could have given rise to the inquiry. You may attempt disclosing the same to the HMRC and working out a quick settlement with least amount of penalties. In most of the tax investigations, HMRC carries out a complete review of your business matters. They may even delve into private affairs, such as investigating your expensive personal possessions. You will be requested to meet their inspectors for in-depth questioning. They might also ask you to provide comprehensive explanations and records to prove your statements. When it comes to providing any requested information or meeting with an investigator, you really want to remain truthful and provide the necessary information. Lying to the HMRC investigators is just likely to course more problems over the course of the tax review. Also, you want to make certain to be fully prepared for an in-person meeting and offer any evidence requested.
Once a duty audit has begun, it can take a few months or even more. Your bookkeeper can advise you on the way forward if HMRC is demanding too much data, taking a long period of time or generally acting irrationally.
GM Professional accountants offices are located in London , Essex and Manchester.
If you are searching for a skilled and qualified accountant that is able to specialize in a particular field, such as contractor accounting, then there are several key points that need to be fully considered prior to using the services of the right person. Here are several tips to consider for choosing a reliable accountant:
1. Qualification. In the process of searching for the right accountant, you will often come across a range of accountants offering a range of services. It is often the case that contractor accountancy requirements are often unique and specific. It is therefore vital to choose a specialized accountant that is qualified in this particular sector. Many of the larger accountancy practices or high street firms are more likely to focus on dealing with large corporations, personal tax planning, or small businesses which might not be suitable for your specific needs. In an initial interview with an accountant, you should ask whether they are specialized in dealing with matters that relate to contractors and that they are fully qualified on such requirements as the IR35. This is a key consideration and will often drop many of the high street based accountancy firms.
2. CPA Reviews. During your interviews, it is a good idea to have a list of questions ready for the accountants. The most important, and often overlooked, the question is whether they are a licensed CPA. Many people simply assume that all accountants are licensed. You don’t want to hire someone who does accounting on the side and never got around to being licensed. Find out how many accountants work with him at his firm. Having a large number could save you money because you could use the cheaper ones for less important issues. You also have to make sure the firm is used to dealing with a business of your size when choosing an accountant.
3. Trust. Oftentimes, when people are choosing an accountant, the individual’s personality is forgotten. You have to remember that you will be working closely with this person, so make sure you choose someone you and the rest of your employees can trust. Convenience also should play a part in your selection. You may have found the perfect accountant. The only problem is that his firm is located hours away from your company. He no longer is the perfect accountant. Choose someone in your area because these are the people you know well and can trust.
4. Experience. When looking for the contractor accountants it is also good to consider how long they have been in service. A contractor accountant with many years of experience has the capacity to do a good job since he/she has done the same thing over and over again. An accountant with a good experience know the various challenges likely to be encountered and how to deal with them. On the other hand, a contractor with little or no experience at all is most likely not going to give you the desired result. The above are some of the things to look at when choosing a contractor accountant.
GM Professional accountants have offices located in London, Manchester and Essex
Filing your own tax returns can be a daunting experience and getting professional help an expensive ordeal. This is why more and more people are choosing to go online and finding themselves tax accountants online. Choosing tax accountants online not only helps you save time but helps you save money too. A simple Google search will give you access to thousands of tax accountants online but should you always trust them? The answer is no! Calling yourself an accountant doesn’t necessarily make you one too. In order to be an actual accountants, one needs to have the proper certifications. In the UK, you can check a firm’s status by logging on to their Accounting body website.
The following list will tell you all that needs to be checked-
The first thing that you need to check is how experienced your accountant is. Is he/she a beginner? Have they worked with any companies similar to yours? Do they have famous clients? This is because experience matters. The more practice your accountant has had, the better they will be at their job. If you’re filing tax returns for an individual, accountants that are beginners will be able to do the job pretty well too. Qualifications You need to make sure that your accountant has the necessary qualifications for the job they’re doing. In the UK, the most commonly recognized bodies are ICAEW, CIPFA, AAT and ACCA. Stay away from fake websites that lure customers by offering low fees, chances are the accountants aren’t qualified at all.
Choose your tax accountant online wisely. After all, this is the person who will have knowledge of every intimate detail of the finances of your company. The accountant could have loads of experience and be properly qualified but until you feel you can trust them, it is not advisable to hire them. Transparency and Integrity Before you hire a tax accountant online, make sure that you communicate your company’s rules and regulations. This ensures that the accountant is aware of the policies and he doesn’t deviate from them. Make sure that the accountant is following the generally accepted accounting principles. It is very important to have an accountant who has values and has integrity. You can ask for a list of old clients and verify with them.
Why I Should Hire GM professional Accountants to do my taxes
GM professional accountants is a trusted firm comprising of registered tax agents who are experts in their fields. The tax accountants are well qualified individuals who have complete knowledge of the tax laws in the UK. Whether you’re an individual or a business, the accountants at GM are committed to serving their clients and offering them the best financial advice. Not only do you save money but you can be sure that your finances are in good hands.
There are many things one can look for in getting specialists bookkeeper in Amazon field. They are required to set priorities that will meet the bookkeeping and vat requirements, by having an understanding of the vat principles that will help to govern various activities within the Amazon field.
The bookkeeper should understand the current events on overseas VAT regulations and accounting software packages when it comes to technology, be well conversant with the cost of different rates of vat and be ready to assist in these matter when problems arise.
GM Professional Accountants possess recommendable qualities and knowledge which we have attained from years of experience that includes tax planning, and be able to demonstrate those qualities into tax savings. GM Professional Accountants have experiences in the aspects of UK vat and this boosted our reliability and makes our clients feel comfortable to focus on their business.
There will be successful and progressive business when the bookkeeper implements good ledger skills and easily bonds with them by responding to various queries and concerns.
Specialist bookkeepers understand the requirements of the Amazon Company to various services and can come up with strategies to solve business-related problems.
When it comes to finances, they should be knowing how to secure account data, paying attention to every detail in the statutory accounts for accuracy. Find a good bookkeeper from a trusted source for instance, checking our google reviews and our accounting body. Also, consider a bookkeeper who understands the local surrounding within the business area who will provide good detailed services to a customer that is remotely located.
As with any other business, effective bookkeeping for Amazon seller will need to provide current answers to many queries for an incredible financial outcome. First, there should be appropriate ledgers on invoices and expenses of a given period of time then the income and expenses analysed, this should allow you to make informed decisions.
when it comes to tax assessment to avoid over or understatement of taxes, bookkeepers can help strategize for these taxes and many liabilities, giving a good report to the owner and planning for bank loans that will boost the business. It will also, provide a clear picture of how the company finances are progressing without missing out on any detail. Bookkeepers also maintain the aspects of finance intact with the goal of driving forward the business in a rewarding manner.
Gm professional accountants have offices located in Essex, London, Manchester.
Hiring a poor quality accountant in London can cost you dearly. In a city where individuals come to buy their fortune, they start new businesses and, similarly, they fail every day. However, what is the contrast between those who have staying power and those who overlap?
Hypothesize to collect
Only one of each strange business starts with a massive spending plan and, despite those who do, it may be tempting to remove the corners at the beginning. However, investing in great financial planning can get more in the long term.
When a decent accountant can cost you a little more initially, they should deserve at least some respect regarding saving you cash and helping you develop your business.
A decent accountant costs more since they leave out the opportunity to understand your business and the procedures so that they are in a situation that ensures that you are prepared for development and minimises work quotas on the way. For a self employed package, it will cost between £25 to £30.00 per month. For a limited company package this could be between £70 to £80 per month if you are not vat registered.
The most effective method to detect a horrible accountant
Billing per hour is something that many accountants still do. The problem here is that it gives the accountant an incentive to take as much time as necessary and allow the work to expand at the convenient time. It is not clear that this generates a better orientation, but induces a higher bill.
If an accountant forgets to set goals that begin before working or does not know what will be achieved or transmitted due to his work for you at that time, stay away.
On the off chance that things start to appear on your bill that you did not request, or did not become aware of what you required, you are generally correct to address them.
The bad skills of the organisation from time to time disappoint even the most sincere accountants. Be that as it may, losing a deadline will cost you money. In case your accountant consistently exceeds the timescales, it may be an indication that you can fight to meet the HMRC deadlines for your benefit.
A decent accountant
A decent accountant will cover the basics, such as your legal records or self-assessment. However, the best you can hope for is to guide you through your information so that you can take a look at your business dispassionately. GM professional accountants are a highly reputable firm and have won the award by three best rated.co.uk
In addition to complying with the HMRC, you will not get an incentive from an accountant who does not think of freshness. When shopping, make sure you are looking for someone educated and interested in what you are trying to achieve. As your business develops, you will need a lawyer to incorporate your business and VAT enlistment. It is useful to start with an accountant who will stay with you for a considerable period.
Past the balance
At GM professional accountants, we look beyond the balance sheet. Our clear way of dealing with accounting means that we unexpectedly work a bit. And in addition to a group of qualified and reliable accountants, when you hire us, you also get your business manager who is committed to helping you understand your information in a way that allows you to develop your business.
GM Professional accountants have offices located in London , Essex, and Manchester.
While renting out your property to tenants can be a very profitable business, you need to know that you do not get to keep all the income. Legally, you are required to declare the income that you get from your property even if you are just renting out a small unit to a student. Although it’s required by law, many people still decide not to declare their rental income. Not declaring your rental income is not worth the risk since if you get audited by the government you will have to pay the tax on the income. You are also likely to pay penalty on interest on the tax that you were required to pay.
Apart from using very sophisticated computer systems, HMRC has a variety of tools at their disposal with connections to the public databases such as the Electoral Roll and the Land Registry. They also regularly carry out tip-off campaigns and even pay huge rewards when any undeclared tax is finally found. They’ve even put in place tax amnesty that they give to those who come voluntarily.
Another important trick that they use is obtaining information from third parties. For instance, they normally write to letting agents and estate agents instructing them to submit the names and addresses of all the properties on their books. This means many landlords who are not declaring their property income are likely to receive letters from HMRC.
How to declare property income
One method that landlords can use is taking advantage of Let Property Campaign and pre-empting the HMRC correspondence. Let the Property campaign is among the honesty programs that are currently being run by HMRC. According to this campaign, if the landlord comes forward and discloses undeclared income then HMRC will give him a much more lenient penalty. While most penalties are 10% they can even be as low as zero.
However, if the HMRC finds out about the income then the penalties can be between 15% and 100% depending on the conduct of the landlord. Let Property campaign is, therefore, a very important tool that can help the landlord to update their tax information. Since it will not always be there, landlords are advised to take advantage of it while it’s still there.
How to go about it
First, you need to alert them that you want to participate in this program by filling a form and calling their helpline. Once you’ve done this, they will give you 3 months determine and settle what you owe. By doing this, you may not have to pay any penalty but in case you do, it’s likely to be lower than what you would pay if HMRC finds out themselves. Thankfully, HMRC has Let Property Campaign calculator that can greatly help you work out what you owe them. However, if you need to disclose more than 5 years then there is a different calculator.
It’s also advisable to use an accountant so has to ensure that you have someone on your side when you are negotiating with them and make sure you are claiming the right expenses and reliefs. Although it can be tempting not to declare the income, the law requires you to do so.
It is estimated that 1 in 3 people in the UK have overpaid on their taxes but are not even aware of it. This means that you too could be due a tax rebate which could amount to several hundreds or even thousands of pounds. Applying for a tax rebate typically means filling in numerous forms and completing a number of calculations and if you don’t have any experience of dealing with this kind of thing (which very few of us really do) then you may consider it to be too much hard work or your tax rebate claim may be unsuccessful despite having a genuine case.
The actual amount of tax you are required to pay on an annual basis will depend on your personal circumstances as well as how much you earn but it will usually amount to several thousands of pounds and could be anywhere from around one fifth of your total earnings to nearly a half.
If you have overpaid for any reason then you are entitled to claim a tax rebate and receive that money back. After all, it is money that you have worked hard to earn so why shouldn’t you claim it back if you have unknowingly overpaid? Whether you have only worked a part of a year, were made redundant part way through the year, or you are set to leave the UK you may be due some tax back.
The difficult financial situation that many of us find ourselves in means that every penny counts and none of us can really afford to lose an average of nearly 1,000 from our annual salary. You could spend the money on a family holiday, on paying bills, or on updating and upgrading your car. Most of us place our faith in our payslips, our employers, and the Inland Revenue to get taxes right and we don’t even check that we are being charged the correct amount. If you are part of a PAYE scheme then you could be owed several hundred pounds in backdated, overpaid tax and you should consider starting a tax rebate claim in order to try and get this money back.
How to Calculate Your Tax Rebate Effectively
A number of taxpayers keep a check on all these issues with the help of a professional accountancy services provider. They help them in managing their accounts and keep them updated with such type of news so that they can file all the documents on time. Several tools are also available in the market, which is capable of estimating your amount for a return. These tools demand an input of all the relevant information for computing your return on the income tax that has been paid. These tools are available for free of charge and are very easy to use. If you are not willing to use these tools, you can always opt for professional accountants who will assist you in this task and provide you with refund estimation in advance.
Every nation has different tax policies which depend on various internal factors. Thus, for estimating most accurate amount, you will need to provide certain personal information like marital status, yearly income, number of dependants, age, etc. These factors will define that for what amount of tax refund you are liable. If any exemptions are there, the accountants will consider the factors from above to provide estimations.
Generally, the government decides if any year requires them to provide tax rebate to people who have made more tax due to some erroneous calculations. A rebate is decided for all the eligible tax payers by taking in account their different activities. This figure depends on different policies and from nation to nation. There are different schemes introduced every year in a country based on the current progress. They are provided as a facility to the citizens for cutting down on their taxes. These generally include different forms of investments, donations and various personal factors like if someone has low salary, belongs to armed forces, a widow, etc.
A lot of the above things depend on your accountant’s skill and the way they deal with it. It is always better to file your tax return on time to avoid any penalties which might cost you much more than what you had to pay. While working for your business, you tend to forget these things because of the daily work tasks that require much more attention. If you fail to abide by the deadlines which are set by governing bodies, it will become difficult for you to get any exemptions because of your bad record. This is the reason that putting all this in the hands of professional is a much better option.
GM Professional accountants have offices located in London, Essex, and Manchester.
HOW TO CHOOSE A COMPANY NAME FOUR YOUR BUSINESS STARTUP
One of the greatest challenges of starting a company is choosing the name for the company. It is a process that doesn’t need only dedication but also creativity. One has to be ready to come up with something unique and different from the other names around.
Choosing a Company name?
There are several names one can pick for his company but there is nothing as spectacular as a name that is both unique and unforgettable. Also, do not pick a name which spelling is unusual. Stick with something that customers can spell easily and is also easy to pronounce and remember. The shorter the length of the company name, the better. Also, pick a name that makes some sense. Lots of names have negative connotations in other languages. Try to avoid that embarrassment. Also, try to make sure your name is available. You can do this by checking up your preferred name with your State Incorporation site, Network Solutions for the domain name and the U.S. Patent Office for Trademarks.
Starting the Company Name Search?
When you want to choose a company name, you will have to do a Company Name Search. This is to prevent embarrassments. Having the same name as another company is like infringing on someone’s right because many companies have had their names trademarked. This is to stop callous elements from trying to make a fortune off their name or dupe people. Whichever way, it is good if a name search is done before picking a name for your company. You can do this by searching through the internet, telephone and trade directories. A lot of companies have their domains online and you will definitely see the same name as the name you chose for your company if you search through. This will prompt you to choose a more unique name.
The Law and Your Company Name?
A company name is an important and valuable part of your business. It can be used to reflect what the company does, or the attitudes and ideals that you want your company to embody. A lot of people, complying with their State laws have gone ahead to register their companies with their State. This may prevent someone from using your company’s name within the State but it doesn’t affect the country. What gives you absolute power is the trademarks right. Only federal registration gives you truly comprehensive rights. When this is done, your-company-name-is protected by the law and cannot be used by someone else. It becomes your sole property.
Protecting Your Company Name?
If you have a unique business name and you don’t want someone else picking it and using it as their own company name, you have to take steps to protect it. First you have to register the name of your company either as a sole proprietorship or partnership. The process of incorporating your company comes next. This is done with the Secretary of the State your company is located. This will prevent confusingly similar names from popping up in the future.
Choosing a Company name FAQ
The purpose of an FAQ is to address frequently asked questions about your company. The FAQ is always featured on the site of the company. It can act as a point of contact for customers looking for answers-before they reach out to you directly with your questions. So it is important to choose your FAQ carefully. FAQ featured should be able to alleviate purchasing anxieties that your product page doesn’t address directly. It should also be able to earn trust by demonstrating product expertise and explaining your business model. Customers should be delighted when the page creatively answers their questions.
It is estimated that 1 in 3 people in the UK have overpaid on their taxes but are not even aware of it. This means that you too could be due a tax rebate which could amount to several hundreds or even thousands of pounds. Applying for a tax rebate typically means filling in numerous forms and completing a number of calculations and if you don’t have any experience of dealing with this kind of thing (which very few of us really do) then you may consider it to be too much hard work or your tax rebate claim may be unsuccessful despite having a genuine case.
The actual amount of tax you are required to pay on an annual basis will depend on your personal circumstances as well as how much you earn but it will usually amount to several thousands of pounds and could be anywhere from around one fifth of your total earnings to nearly a half.
If you have overpaid for any reason then you are entitled to claim a tax rebate and receive that money back. After all, it is money that you have worked hard to earn so why shouldn’t you claim it back if you have unknowingly overpaid? Whether you have only worked a part of a year, were made redundant part way through the year, or you are set to leave the UK you may be due some tax back.
The difficult financial situation that many of us find ourselves in means that every penny counts and none of us can really afford to lose an average of nearly 1,000 from our annual salary. You could spend the money on a family holiday, on paying bills, or on updating and upgrading your car.
Most of us place our faith in our payslips, our employers, and the Inland Revenue to get taxes right and we don’t even check that we are being charged the correct amount. If you are part of a PAYE scheme then you could be owed several hundred pounds in backdated, overpaid tax and you should consider starting a tax rebate claim in order to try and get this money back.
How to Calculate Your Tax Rebate Effectively.
A number of taxpayers keep a check on all these issues with the help of a professional accountancy services provider. GM professional accountants help them in managing their accounts and keep them updated with such type of news so that they can file all the documents on time. Several tools are also available in the market, which is capable of estimating your amount for a return. These tools demand an input of all the relevant information for computing your return on the income tax that has been paid. These tools are available for free of charge and are very easy to use.
If you are not willing to use these tools, you can always opt for GM professional accountants who will assist you in this task and provide you with refund estimation in advance. Every nation has different tax policies which depend on various internal factors. Thus, for estimating most accurate amount, you will need to provide certain personal information like marital status, yearly income, number of dependents, age, etc. These factors will define that for what amount of tax refund you are liable. If any exemptions are there, the accountants will consider the factors from above to provide estimations.
Generally, the government decides if any year requires them to provide tax rebate to people who have made more tax due to some erroneous calculations. A rebate is decided for all the eligible tax payers by taking in account their different activities. This figure depends on different policies and from nation to nation. There are different schemes introduced every year in a country based on the current progress. They are provided as a facility to the citizens for cutting down on their taxes. These generally include different forms of investments, donations and various personal factors like if someone has low salary, belongs to armed forces, a widow, etc.
A lot of the above things depend on your accountant’s skill and the way they deal with it. It is always better to file your tax return on time to avoid any penalties which might cost you much more than what you had to pay. While working for your business, you tend to forget these things because of the daily work tasks that require much more attention. If you fail to abide by the deadlines which are set by HMRC, it will become difficult for you to get any exemptions because of your bad record. This is the reason that putting all this in the hands of professional is a much better option.
FreeAgent is a cloud-based bookkeeping solution for freelancers, bookkeepers and also tiny businesses proprietors to handle invoices, costs, pay-roll, income tax return as well as other accounting tasks. FreeAgent additionally uses specialized mobile apps for iphone as well as Android tools.
FreeAgent makes it possible for Tax advisors to prepare up recurring billings which are instantly sent out to clients as suggestions making payments. Consumers can also track costs by uploading the photograph from an expense voucher with the FreeAgent mobile phone app.
The option gives an integrated stopwatch attribute to manage timesheets as well as keep track of employee hours. The user dashboard gives a summary of key organisation metrics from a singular display screen. Company proprietors can easily track billings, price quotes, timetables and venture condition.
Tax timeline functions and additionally offers updates and reminders concerning deadlines and tax dues. FreeAgent utilizes a 256-bit safe and secure outlet level relationship to protect customer records.
Finalising Statutory Accounts in FreeAgent
The FreeAgent software enables you accurately order your companies profit and loss account, notes on the accounts and the directors assessment, your auditors report. With the FreeAgent software we can help you finalise your statutory accounts easily and effectively.
For smaller companies what is needed is the balance sheet and tax returns in order to properly finalise statutory accounts.
Features of FreeAgent Software
Access to Overview FreeAgent is fantastic because that permits you to look at each of your accounting information in one place. The 1st Online control panel is crystal clear, to the point and transparent. When making use of a typical accountant it may be actually tough to gain access to this kind of information without a large volume of email or telephone call back-and-forth.Along with the FreeAgent dash panel, the review is accessible to you whenever you require this.
Fast Access to Information You could quickly track the progress of your service profiles with a glimpse at thedash panel. We assume this simplifies the accountancy process through a very long way. You can find the modifications created to your financial resources on your own.
Choosing an Online Accountant It used to be very important to have your business’s bookkeeper found in a location not far away. Yet today, even more providers are collaborating online, making use of cloud-based innovation to handle their organisation.
This means that place of operation is actually far less from a concern. With cloud accounting, you and also your accountant may look at identical real opportunity data together– despite where you are actually.
The choice regarding where to find your accounting professional definitely comes up to exactly what satisfies your company well. Relying on exactly how you wish to manage the financial resources, your accountant might definitely be located in a different part of the globe. For instance, if you more than happy to collaborate via e-mail, phone calls, video-conferences, or protect. bookkeeping software, then you can be in New York and they might be in London, if your bookkeeper can easily be actually anywhere, you can easily discover someone which truly recognizes the specifics of your service or even market.
Choosing an Online Accountant In London Choosing an online account in London is very essential because it ensures your account, understand the laws of the land and to properly administer your financial records with respect to the national regulations.
GM professional Accountants have offices in Essex, London and Manchester.
The value of the house is one of the major things that potential home owners look for when selecting a house to buy. The value of the house depends largely on the location of the house and the furnishing and repairs needed to be done. Getting a valuation for your house is important in helping you to estimate the amount you will possibly get when you are planning to sell your house.
To ensure you get the correct value for the house, there are a few things you need to consider. Some of the most important things to consider include the following;
• The value of the houses in the street. The value of houses vary depending on the location and area of the county or country you are in. Houses in urban areas tend to cost more than the houses in rural estates. Finding the value of the adjacent houses in the street also enable you to estimate the real value of the house.
• Finding out amount of money the previous buyers of the house got it for. This enables you to estimate the real current value of the house at that particular time.
Our choice is Estate agents London because they provide a free no obligation valuation with competitive fees in London
• The trends in the real estate prices in your area. This is important information to any house owner. The trends in the real estate prices in the area enables you to know when it is most convenient to sell your house. Knowledge of the market trend also enables you to avoid inconveniences when planning to sell your house. Trends in the national level on the real estate market also hugely determine the prices of the houses.
How to get a ballpark valuation
Ballpark valuation is able to help you calculate the real value of the house depending on the market value. There ae several ways to calculate the value of the house for buyers, sellers, and all other parties that are interested in the value of the house. Using the ballpark valuation, mainly helps sellers to get the actual value of the house. Here is a breakdown of the approaches to use when using this method to calculate for the value of the house.
a) Using price multiples
This is one of the simplest and easiest to use approach when you are valuating your house. This is mostly used by people to get the market value for small businesses. Under this approach, there are two main types which are the cash flow and revenue. To calculate the cash flow, you are required to sum up all the incomes and revenues accrued before deducting taxes, interest rate and depreciation. After determining the values, you can find the most commonly used multiplier which you multiply with the value you have found. You should find the correct multiplier to multiply with your value depending on the demands of the market and changing trends.
This is another approach that you can use to valuate your house. This involves finding the value at which recent buyers have been getting the house for. You can also go a little further and determine the value of other property in the same industry, location and even size. Comparing your house with other properties, putting the features side by side, enables you to get a clearer picture on the value of your house. The information you need can be easily found in the internet and even from the property brokers
b) Bring in professionals
The purpose of hiring a professional is to enable you get a specific value depending on the dynamics of the market. Our recommended choice Estate Agents London are able to calculate the value of the house and give the accurate value. This is one of the advantages of this approach over the other approaches, it is accurate. They are also familiar with the correct and most suitable multipliers available for you depending on the industry you are in. Having a professional will also enable them to get deeper into specific details that you cannot be able to handle and understand on your own. A professional is also able to shorten the process from valuation to the final sale of the house.
Can making repairs increase the value of the house?
Making repairs and adding finishes to your house is guaranteed to increase the value of the house. This is because potential buyers mostly prefer to move in without having to make any repairs to the house. However, the repairs o you want to do to the house depend on the industry you are in. Some of the buyers will prefer to do the repairs on their own so that they are able to customize the house. The capital gains tax is the tax accrued from the profit you gain from the sale of assets like properties and houses. You are required to find out whether the area where you are selling your property requires you to pay the capital gains tax. In addition to that you should ensure that the rate at which the tax should be paid in order to know how much you should sell your house at.
Considering Capital Gains tax on your property
If the property is your main residence then then this will be covered by PPR relief. If this is your second home then there may be capital gains tax implications. if you have lived in the property at any given time then letting relief may apply. This type of relief is not automatic and will need claimed in the tax return.
Finding the real value of a house can be a bit difficult. This is because of the different change and trends in the market today. However, it is easy to valuate your house by using the ball park valuation. This involves the use of either of the three approaches, the use of price multiples, bringing in professionals and using comparison. Hiring the services of professionals is the best approach because it is accurate. This is because the professionals are able to get into deeper details of the property and are also conversant either the current trends in the market. When valuating your house, other things like repairs may also greatly affect the value of your house. Doing repairs may increase the value of your house depending on the industry you are in. Some buyers may prefer to do repairs on their own so that they are able to customize the space to meet their needs and specifications. In valuating your house, the price of other properties in your locality can also be studied and used to arrive at an estimate value.
How to change my accountant – considering switching?
When it comes to changing service providers especially accountants, most people are often reluctant. Even with poor services and total dissatisfaction, most clients remain loyal to their accountants. This tendency might be as a result of certain perceptions that clients hold with regards to the whole process of changing an accountant.
The notion that changing an accountant is a risky process.
Doubting whether another accountant will be any more effective that the current one.
The notion that changing an accountant is a difficult process.
In this article, I will provide information on how the process is undertaken, offer reasons as to why one should change their accountant and offer a review of GM Professional Accountants.
A clear procedure is provided for within the accounting profession on how one should change their accountant. At this point, I should mention that this process is common and legitimate accountants will take the whole process professionally.
The steps you are to follow as a client when changing you accountant are;
Give your accountant a notice.
This notice is written to the current accountant. It can be in form of an email. It details which companies you would like to move to new accountants. It also provides information on the date in which the move should be completed. In the notice, it is important that you provide information about the new accountant. The notice is important as your current accountant must have a written statement from you before they can move your financial records to another accountant.
Preparation of a professional clearance letter.
After you have provided your current accountant with a notice, your new accountant will usually send a written document to your current accountant in order to request for a professional clearance. The accountant will request for professional clearance as well as any paperwork relevant to you from your outgoing accountant.
As part of due diligence, your new accountant will ask the current one whether there are reasons why they should not take you on as a client. The professional clearance letter also provides an avenue where the current accountant can point out issues they have had with the client. They include issues to do with the client’s honesty with regards to their finances. This serves to point out fraudulent clients.
I should point out that your current accountant may charge you a fee for this service especially when a lot of work is involved.
Transferring records and assignment of authority.
At this point, when everything else is complete and it is all in order, the outgoing accountants will transfer your financial records to the new accountant. This is usually an easy process. After the records have been transferred, you may now assign authority to the new accountants so as to allow them to handle your tax affairs including filing your tax returns.
When should you change your accountant?
In a case where your accountant is not providing tax planning advice, then it is time for a change. An accountant should offer relevant advice on ways to reduce your tax bills. Your accountant should essentially help you pay the least amount of tax you are legally required to pay and not just filing tax returns.
For effective financial administration, communication between you and you accountant is key. Hence, if your accountant fails to pick your calls or takes too long to reply to your emails, then this is a red flag and it is time to look elsewhere.
For a case where your business might have outgrown your accountant, then it is time to get a new accountant. This can be signalled by your accounts becoming too complex for your accountant. It might also be the case that your accountant has outgrown you. This might be the case for a small business in whereby, a very large accounting firm might not offer you the best value for your money and as such you might want to get a different accountant.
Why you should choose GM Professional Accountants firm?
GM Professional Accountants is a well-established accounting firm based in London that offers a variety of financial services to businesses and individuals in various industries. The services include but are not limited to; accounting services and tax management services.
The firm also offers online accounting which increases flexibility for those in far-off areas. Another key aspect of the firm is that it offers adequate small business accounting ensuring that even for a small business, you get the relevant accounting services. The many 5-star reviews on google ratings from satisfied clients portray a well-structured firm where everyone gets the necessary attention ensuring seamless service delivery.
Owning property in the United Kingdom is not easy for first-time buyers. It is important to hire property accountants to offer you insights and advice on your investments. There are many property accountants in the UK. However, selecting the best accountants can be one of the most daunting tasks. It is advisable to compare more than one accountant in the nation before making your final decision. Here is a simple guide to finding a great property accountant in the UK.
It is advisable to read reviews of different property accountants online. Reviews will enable determine whether the services you are about to hire are worth your money. There are different sites that offer reviews on various services including property accounting. Read several reviews in order to make an informed decision. Do not waste time and money hiring an accountant with many negative reviews. If other clients are lamenting about the services they received from the accountant then you are equally not safe. Only hire services of an expert with positive reviews if at all you care about your investment.
Yellow pages offer information on different services across the United Kingdom. The platform has contacts, address and other details of property accountants. You can check the contacts to find property accountants near you. Once you have selected several accountants, you can consult them to find out the kind of services they offer before you make any move as far as property ownership is concerned.
With the growth of technology, property accountants have also opted to create their presence on the internet. Google has an endless number of property accountants who can come to your rescue whenever you want assistance. The accountants offer different services at different costs. However, it is wise to conduct proper research before accepting to work with any of the accountants you will find online. A good number of Google property accountants promise what they do not deliver. Read what others are saying about the accountant you are about to hire before you determine your next move. Failure to conduct research is likely to make you land someone who will fail your investment with poor analysis. If you decide to hire an accountant from Google then you should consider the following aspects
Academic qualification is among the aspects you cannot afford to ignore when hiring a property accountant in the UK. You need to find someone with the right academic qualifications. A good accountant is one who studied in an accredited institution. He or she should also be a member of different chartered accountancy organisations in the UK. The accountant needs knowledge to advice you on capital gains tax and income tax. This will only be possible if he or she is qualified.
Find out how long the accountants have been offering services in the UK. An experienced accountant is better placed to offer high-quality services than a new entrant in the field. This, however, does not mean that new accountants do not offer great services but it is hard to determine the same.
The cost of hiring an accountant varies across the United Kingdom. Find out what you will end up paying in reference to the quality of services before hiring one. You can compare several service providers before you select one for your firm.
GM Professional have offices Located in London, Manchester and Essex.
Top 10 Profitable Businesses to Start From Home in the UK
Starting a business in the United Kingdom these days is not as difficult as it used to be. This is because of the rise of online commerce and all the business tools and resources that are associated with it. And of course, there’s the fact that the capital needed to start a business venture from scratch has significantly gone down. With just a few thousand pounds, you can start a small business and launch it within a short period of time. If you’re planning to start a business anytime soon, below are some venture ideas that you can explore. Also included in the list are the estimated profit percentages associated with the venture.
1. Real Estate Agents (15.19%) – All you need to start a real estate brokerage firm is an agent or a brokerage license. The returns can be very lucrative especially if the economy is doing well and the value of properties go up.
2. Ecommerce Website (15.10%) – The biggest advantage of building an ecommerce website is that you don’t need much to launch it. You can have a complete website built and launched for under 100 pounds. Another benefit of ecommerce is that you can choose to either sell other people’s products through affiliate marketing or you can create your own products and keep most of the profits.
3. Automotive Rental or Leasing (14.55%) – With more people getting disenfranchised by traffic and commuting, now would be the perfect time to offer automotive rental services. You can start with a few cars and when things go well, you can slowly expand your services.
4. Legal Services (14.48%) – This has very low operating costs. And if you’re good, you can accumulate a lot of repeat clients. You can also branch out to notary services.
5. Industrial Machinery and Equipment Rental (12.58%) – This can be very profitable especially if you live in an industrial region where there’s a boom in construction projects. The only drawback of this business is that you are going to need a huge initial capital.
6. Business and Management Consulting (12.05%) – Business consulting is in huge demand these days especially with the rise of online commerce. There are companies and human resource managers out there who badly need advice from business consultants.
7. Design Services (11.4%) – The creative industry caters to a huge market. You can focus your attention on a specific niche like graphic design, industrial design, product design, or illustration.
8. Office Administrative Services (11.3%) – Businesses and companies from all over the world are always looking for third parties to manage their administrative operations. You can offer services like record keeping, billing, or even financial planning.
9. Social Media Management Services (11.2%) – Social media is big business right now. Social media presence is a very important aspect of marketing these days that it has grown into a separate industry. Starting a social media marketing firm is easy and you don’t need a lot of capital.
10. Technical Consulting Services (11%) – Almost all businesses these days are in one way or another in need of technical support. This is where you come in with your technical consulting services.
When it comes to returns on your investment or capital, these are the most profitable business sectors in the country today. Needless to say, you should trail your sight on these sectors if you have plans of starting your own business. You have better chances of achieving success if you focus your attention on these sectors.
Let property campaign helps landlords bring tax affairs up to date
If you are a residential landlord in UK and you want to get your tax records straight and accurate, then the Let Property Campaign is for you. HMRC believes that all people should get an opportunity to pay the right amount of tax and this campaign is for those who have some inaccuracies in their tax records. If you are a landlord and you have some undisclosed income, then you should immediately contact HMRC regarding it. They will give you a time period of 90 days to calculate all your undisclosed income and finally pay what you owe.
Why it’s important to join the campaign?
This is a great opportunity to reveal your undisclosed income even if you have not disclosed it intentionally. The advantage is that HMRC is allowing you to tell what you believe how much you should pay as penalty. In case it was unintentional, then you may not need to pay at all. And don’t worry about the amount of penalty. If your financial position is not strong, HMRC will allow you to pay in instalments.
Tax Advisers on planning and dealing with Capital Gains Tax on Your Home
Capital gains tax or CGT is the tax on profit paid when one disposes of an asset. It is charged on profits made from selling any property that is not your residential home. Fortunately, you can waive this tax, and a London expert on tax matters shows you how.
The amount of CGT charged in the UK on assets differs according to certain categories. For individuals, the capital gains tax rate ranges between 18% and 28% of the amount gained on disposing of an asset. Trustees or representatives of say a deceased person is required to pay 28%of the gains made from disposing of assets they are trusted with or representing.
Any gain that qualifies as Entrepreneurial Relief will be charged 10% on gains. Private companies not based in the UK will be charged 20% on gains for disposing of assets that were owned by the UK. Property whose Annual Tax on Enveloped Dwellings has been paid will be viable for a 28% capital gains tax.
Annual Tax Allowance or Exemption
Residents in the UK are eligible for tax-free allowance on CGT. This tax relief is applied annually and under certain conditions. Individuals who are domiciled in the UK qualify for the annual tax exemption on gains. Trustees or representatives of an estate previously owned by a deceased individual also qualify for tax exemption. Thirdly, trustees of disabled persons also get an annual tax relief on asset gains.
On the other hand, there are individuals or groups that are not eligible for an annual tax-free allowance in the UK. This includes any individual who is not a permanent resident in the UK but owns assets in the UK. Private foreign companies holding assets on UK soil also do not qualify for annual capital gains tax exemption. Anyone who has claimed remittance basis from a foreign country instead of the UK will also not qualify for annual exemption on capital tax gains.
Annual Exempt Amount
The annual exempt amount is a marked amount which qualifies individuals and companies for annual relief on capital tax gains. This amount varies with each year depending on revisions made by the UK government. For the period 2016 to 2017, the annual exempt amount on gains made by individuals was £11,100. This amount has been revised to £11,300 for period 2017 to 2018. For trustees, the annual exempt amount for 2016 to 2017 is £5,500 which will increase to £5,650 for the period 2017 to 2018.
To avoid capital tax on the gain, individuals and trustees must ensure their total annual profit does not exceed the set annual exempt amount.
Other Ways to Avoid Capital Gains Tax
Capital gains tax will only be applicable when an individual or trustees sell property that is not their own residential home. Selling anything else like a business, second home, or shares automatically mandates the paying of capital gains tax.
Capital gains tax on a second home applies where one is selling a buy-to-let home or a resort home. The capital gains tax paid will be high but one can make it lower. Once a profit or gain has been made, deduct expenses like legal fees, stamp duty, real estate fees and any other expense. Secondly, deduce your allowance from the remaining amount. Calculate the gains tax on the net amount using your income tax status; this will likely be between 18% and 28%.
Letting relief is another way to avoid paying capital tax on gains. This relief is offered on any gains made from selling property that has been the taxpayer’s home for a period of time. This relief also applies if the said property was once rented out as residential accommodation. However, capital gains will be charged albeit it will be a smaller amount of what would have been originally charged.
The regulations on capital gains tax keep changing each year. It is important to consult the advice of tax accountants to calculate how much you should pay or whether you qualify for tax relief.
Uber is a leading transportation company, operating in 633 countries worldwide. It has its headquarters in San Francisco in the United States. The company mostly operates via the mobile app and allows users to book vehicles via the application. Also, independent, self-employed drivers can register on the app or website and become a member of Uber community. They allow attractive rates per miles and also flexible timings as per driver preferences. The company has got firm roots even in the United Kingdom.
What are the allowable expenses for Uber Drivers?
Knowing the list of allowable expenses is important as it will reduce your tax bill. You need to pay tax on the amount earned minus the allowable business expenses. So make sure you keep a note of these.
Mileage claim – You can do this claim if you own the car. The rates are 45p for the first 10k miles and 25p thereafter. If you make this claim you are not eligible to claim for the cost of the car, servicing, and insurance.
Car purchase – If you purchase a new vehicle, you may able to claim it all (depending on the private use) or the cost over a few years. Rates are as follows :
75g/km-130g/km (CO2) you will get 18% capital allowances.
130g/km or more you will get 8% capital allowances
Car lease payments – You can redeem the monthly cost of the lease as well as fuel cost, servicing, insurance, and repair cost.
The four major bookkeeping requirements for tax management of an Uber driver are as follows:
1. You must register yourself as a self-employed individual on the HMRC website,
2. Make sure that you keep the receipts and expenses of all the business transactions handy.
3. Complete self-assessment of the income and expenses must be done prior to 31st January of each year.
4. Any pending tax or National Insurance must be paid before the due date of 31st January.
However, being an independent self-employed driver makes it difficult for some people to handle their taxes. Few drivers are not educated enough about the taxes and other legal guidelines of bookkeeping. Due to this, they may land up in paying extra money or some kind of penalties as well. To avoid such a situation, it is very much important to understand the tax mechanism and hire a proper accountant for your needs.
How to find a good accountant for your business:
There are several accounting firms as well as private accountants that provide accounting services for Uber drivers to manage their accounts in the UK. As there are lots of receipts and expenses on a daily basis, the bookkeeping process is little tedious, but if the driver maintains a proper logs or file of the receipts then it can become very easy.
Many of the accounting firms also provide Mobile apps to the uber drivers to record their transactions in an easy way. Major responsibilities of the firms include:
Helps in creating profile in HMRC
Does auditing to judge the real profit of the driver
Can provide mobile app for the HMRC Self-assessment, Housing benefit applications as well to know your tax credits
Keep track and note of all the business income and expenditure
Register details of the vehicle mileage and other details of the vehicle
Provides accounts that are ready to be submitted for filing HMRC Self-Assessment return
Gives advice on record keeping
Helps in Tax investigations.
The cost of hiring an individual accountant for tax consultation in the UK can be less than 250 GBP, however, for companies; it can vary between 600 to 650 GBP. The services provided may vary as per the pricing. You must research the company or individual over the internet properly and read reviews and ratings before hiring for your tax management.
Determining an accountant for your business is a significant and complex choice. You aren’t just hiring a number cruncher; you’re hiring an essential business partner as well. So, as with any business partner, you must make sure that they understand your business.
Online accountants for self employed play a vital role in the modern day business world, as they offer many vital services such as completing your tax returns, bookkeeping, cash flow projections, payroll, and even online accounting. If you run a small business, making the right choice is particularly important because at the outset your accountant is likely to be your only professional adviser.
Well, don’t worry – this article is all about imparting the key steps towards finding the perfect accountants. You may think it’s as simple as looking one up in the phone book, but the brutal truth is that just about anyone can call themselves an accountant without any real qualifications. Finding a bona fide, experienced accountant takes much more effort.
The following steps are designed to cut through the dross and find you the perfect accountant:
– Ask for referrals to accountants from other business owners.
– The Institute of Chartered Accountants, the Association of Chartered Certified Accountants, AAT, and The Chartered Institute of Management Accountants – these are seals of approval that you should insist on finding. If your accountant can’t produce any of these on demand, then look elsewhere
– Meet your accountants in person for one-to-ones – do this several times before you make a decision. Ideally, you should be able to communicate freely and easily with each other.
– Outline your current and predicted needs of your business so your accountant can meet them and synchronise their efforts.
When it comes to cost – be cautious. The first consultation, where you begin ascertaining whether or not they’re right for you, should be free. Most accountants offer this service, but it’s always good to check, just in case. Also, always decide upon a fee limit early on with your accountant – if they only seem interested in making money for themselves, they aren’t right for you. Also, make sure they are capable networkers, able to provide you with contacts and arrange meetings with integral supporters such as suppliers, bankers, and customers
In addition to your accountant’s financial knowledge, you can also have personalised cash flow projections, have your bookkeeping and payroll managed efficiently and provided important advice. Fuelled with your data, there’s no limit to what your accountant can do – it’s just up to you to find one with the right skills to match your business.
Setting up a day-by-day accounting system, however, should be a priority, whether it’s merely compiling an organised ledger system or a more sophisticated computer programme. Your accountant should be ready to assist and advise in setting this up.
Never underestimate the power of the accountant in your business. Their knowledge of finance and business will no doubt exceed those of the first-time businessperson, so don’t underestimate the power they have. Treat them with respect, but also let them know where their responsibility ends, after all, you’re the boss.
Accountants are a regular benefit to your business – they’re experienced, capable and potentially crucial in the running of your business. Without a proper accountant, your chances of financial survival in an increasingly competitive market drop significantly.
A 1100L tax code means that your tax-free personal allowance is £11000. Simply put, that means £11000 of your earnings will be paid untaxed throughout the year, in equal increments over 12 months. The “L” refers to your status as a regular employee who is eligible for that tax-free personal allowance. Any income above £11000 will be taxed at the standard rates, and, if you make over £100000, your tax-free personal allowance may be smaller than £11000. Any income over this tax-free personal allowance, but below £33000, will be taxed at the basic rate of 20%.
What affects my tax code?
Many factors affect your tax code, including the aforementioned tax-free personal allowance. First, your tax-free personal allowance will be calculated; next, any untaxed income or job benefits with monetary value are added up, and that amount is deducted from your previously determined personal allowance. The last digit of this number is removed–hence, £11000 becomes 1100. The ending letter (L, for example) refers to any situation which may affect your personal allowance, such as the Marriage Allowance, or being taxed at Scottish rates.
Benefits in kind
“Benefits in kind” is the term for those job benefits with monetary value which are not included in your salary, such as childcare or a company car. As mentioned earlier, while these benefits are not included in your salary, their value will be deducted from your personal allowance.
Claiming tax relief for expenses is one way to ensure you are paying only as much as you truly owe in taxes. “Expenses” in this context refers to items or travel purchased solely for work use, such as business travel. It is important to note that you cannot claim tax relief for expenses your employer has reimbursed you for, or for items purchased despite your employer providing an adequate alternative. To claim this tax relief, use your Self Assessment tax return if that is already your usual practice, or use form P87 if you do not file a tax return for any claim below £2500. If you wish to claim an amount over £2500, you must use the Self Assessment tax return.
What is the the tax code for 2017-2018?
The 2017-2018 tax code is 1150L, meaning your tax-free personal allowance has been raised! Additionally, the “basic rate limit,” or the amount of your income taxed at the basic rate of 20%, has been raised to £33500 from £33000
What if I have two jobs?
If you have two jobs, one job will be classed as your “main employment,” and you will receive your tax-free personal allowance in full. For your second job, all of your income will be taxed at the standard rate of 20% up to £33,500. This job will be considered your “secondary” job. If your income at your “main” job is less than your tax-free personal allowance, then you may request your personal allowance be distributed between both your incomes, or you might request a refund at the end of the year (when you file your tax return, if you do so).
How to choose the best CPA online – 5 Things To Consider
It is always a challenging task to choose a CPA for your business from the
deluge of accountants available online. There are around 76,000 qualified accountants in UK and this will add to the dilemma of choosing the right one. London has some of the most renowned accountancy agencies but you need to be aware of certain steps in order to hire the right CPA for your company.
If you want to ensure that you are getting the correct tax advice, do not forget to check the experience of the accountant. It is important that the CPA has worked with similar sized companies and had job responsibilities that were at par with the job role offered. Accountants will also be only valuable to the company if they have worked in similar industries and can provide expert advice on the tax system. CPA’s have to also keep abreast with the latest tax laws running in the country and have to report periodically to accountancy associations about their development.
You will not always depend on employees but this is not an option where it comes to choosing an accountant for your firm. You need to trust your CPA inside out to be able to confidently grow your business. Accountancy embezzlement is not totally unheard of and needs to be paid attention to. You should perform a thorough background check via Google or yellow pages etc. Be extremely wary and alert when you are interviewing the person. You need to establish beyond doubt whether he is going to be with your company for the long term.
Anyone can call themselves an expert in the UK tax system but you will not hire them unless they possess technical qualifications in accountancy. Usually everyone starts with the AAT qualification and then gains experience. While they climb the career ladder, accountants can get higher qualifications to expand their job roles in bigger companies. Once the CPA has a basic qualification, they can register into a training contract with an ICAS authorised employer to become a chartered accountant. It is highly prestigious for a chartered accountant to follow this route.
4. CPA reviews
When trying to find an accountant online, you can always check the reviews that they have acquired from various firms/individuals they have worked for. There are many dedicated websites that review the accountants and you can find valuable information in these reviews. There is of course an option to choose an agency instead of an individual and there are again review websites for them. Glassdoor.co.uk, yell.com, ukaccountancyfirms.co.uk/reviews etc. are websites that will help you to choose a high calibre CPA. The reviews will contain a lot of polarised content so be alert in making your decision.
Always request the CPA whom you have shortlisted to provide the necessary references of people. You can then conduct a thorough investigation into the previous employers of the CPA. Prevention is always better than cure so it is important to interview the references provided and check for consistency in their information. References can be a good judge of one’s character because you can always tell a person by the company he/she keeps. Also, in the event of a mishap, you can always contact the references for more details.
It will definitely be to your benefit to keep in mind the above factors while you search online on search engines like Google, Bing etc. for the right CPA for your business.
THIS IS WHY YOUR SUBWAY SANDWICH WILL COST YOU A LITTLE MORE THANKS TO NEW TAX
Subway has been hit by the new taxation laws in UK, where any hot and toasted subs will be imposed a 20% VAT. Everybody knows that Subway is one of the favourite stopovers for quality, fresh, well-wrapped and hot fast food that now goes for an extra cost thanks to new VAT law that was proposed by George Osborne in 2012.
Subway’s effort to protest the new imposed charges has been in vain, even after trying to re-brand their toasted subs to “hot bread sandwiches’ in order to protect the interest of their customers without increasing the price. A spokesman from subway said: “We have been trying to challenge this VAT law since 2012 in order to protect our customers. Subway franchisees have been absorbing the VAT cost, charging a single price for food, whether hot or cold or eat-in or take-away.”
A standard 6 inch sub could cost as much as £3.69 before the introduction of “pasty tax” on VAT. This means that as per now, the customer who wants their sub to be heated up should add a 20% (equivalent to 69p) which sums up to £4.18 for a single sandwich. Having a sandwich toasted has become a standard procedure to many customers who expressed their unhappy thoughts about the new prices on social media. “Absolutely ridiculous that Subway now charge for toasted bread.” a customer pointed out on twitter. “What next? Charging us to use the bathroom? #subway”, another one expressed his anger. It should not be a surprise that some customers have not noticed about the price changes, saying that they are just consuming their subs. “Has there been a recent change in VAT law I’m not aware or are Subway just taking the ****?”.
A customer on HotUKDeals said: “Just saw a sign in my local Subway saying they’ll shortly start charging 20% VAT if you ask for your sandwich to be heated up,”.
“Am never going again” said a fuming customer concerning the new tax rules.
Another one commented “What is this all about? Bold strategy from them. It’s the quickest way to annoy people.”
The rise of charges on heated subs has forced subway to lower the prices of products that do not attract VAT. “Currently Subway stores in the West Midlands are testing a different structure for menu-pricing. The dual-pricing menu is similar to what customers see on other high-street chain menus, which ensures that customers pay the lowest price for products which do not attract VAT.” Subway spokesman said in a statement.
This new tax rules which were made effective as from 9th August 2017 are said to be politically affiliated. It came as a surprise to the Subway customers across all the cities in the UK who are in need to refuel when lunchtime approaches. Since there is nobody has the will of taking a cold meal deal, they perhaps have no option than to have their sandwich or sausage roll toasted and warmed. The pasty tax (2012) also indicated that you have to pay some extra cost if you have to eat in. in contrast to this cold food are not taxed. This could have an advantage to only those who have their sub as a take away to warm in their homes.
The introduction of the new VAT rules on hot and toasted sandwiches is just an indication that customers will lower their demand on the product and some will even look for other substitute products. An alternative idea that subway can opt to do in order to retain their customers is to improve the quality of their sandwiches and introduce some offers. It is clear that this pasty tax is against the will of people.
Although paying less tax is the desire of every tax payer, it remains a dream to most of the taxpayers in the UK because tax avoidance has been limited to multi-national corporations; not small businesses. Besides, findi
ng information on how to reduce your tax bill may be tricky. However, all is not lost as far as saving tax is concerned as there are various practical ways for individuals and small businesses to minimise tax. One way to get information on how to save your taxes is to consult tax experts such as tax accountants. The following are applicable tax saving mechanisms you can apply:
i). Top Up Your Pension
This involves contributing more into your pension scheme. This should be done by your employer, who should be responsible for deducting the pension from your salary before it is taxed. For instance, if your yearly earnings amount to £50,000 and your yearly pension contribution is £3,000, then your taxable income will only be £47,000. However, if you decided to contribute only £1000 a year towards your pension, your taxable income would be £49,000, meaning you would pay more tax.
ii). Trust A Spouse
Trust is a major building block of your relationship with your spouse or civil partner. Likewise, trust can be handy when it comes to saving your taxes. All you need to do is to determine who pays lower tax between the two of you. Moving your savings into the name of the spouse or civil partner with the lower tax rate helps you to save a great deal. For instance, if one of you is under high tax rate and the other is a basic taxpayer, it would be economical to move your savings into the name of the spouse or partner that pays taxes on the basic rate to reduce your tax bill.
iii). Dividend Allowance
Dividend allowance refers to a certain amount of dividends that may otherwise be taxed as an income. To be precise, it is tax exemption for up to a certain amount of dividend income. Dividend tax allowance policy in the UK came into effect in April 2016 to replace the previous dividend tax credit. Each taxpayer in the UK who gets dividend income is entitled to this tax exemption. This exemption is not in any way dependent on the amount of non-dividend income you get. Worthy noting is the fact that your first £5,000 dividends from stocks and shares is not taxed. This simply means that you can be exempted from paying tax on up to £10,000 per year as a couple.
iv) Claim Expenses
Claiming expenses helps you to lower your tax bill if you are either a private landlord or a self-employed individual with small businesses. In this case, you have the liberty to deduct expenses from your income before paying tax. While your expenses as a self-employed income earner may include office service, stationery, equipment repair and car services; mortgage interests and property maintenance may constitute part of your expenses as a private landlord.
Saving tax may prove crucial if you are to reduce your annual expenses and maximise your income. Whether you run big or small businesses, or you are an employee, getting it right at all times is of paramount importance. It is therefore safe to take full advantage of these tax saving tips and apply them to the a tee. Additionally, professionals like tax accountants are handy when you are in need tax saving information- make use of them too.
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 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.
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.
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)
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.
Run your business in a lucrative and hassle-free way by hiring the accountants from GM professional accountants
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
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.
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.
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.
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, Manchester and Essex.
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.
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.
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
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 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.
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.
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.
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 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.
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.
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!
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.
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.
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.
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.
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.
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.
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. Gm professional accountants have offices located in London, Essex and Manchester.
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.
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.
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.
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.
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.
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.
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.
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.
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.
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.
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.
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’
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!
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.
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.
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.
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.
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!
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.
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!
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!
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.
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.
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 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
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
More and more people are taking the plunge and becoming self employed. There are so many great things about choosing this way of life. Let’s take a look at some of the main things that can convince you that being self employed is for you!
Freedom of being self employed
No more waking up for someone else, no more working to make your boss rich. Being self employed means that all the money you earn, you keep. It is as simple as that! It also means that every day you set the agenda, no one to answer to apart from your own dreams. No matter who you are, this is an attractive prospect.
Expansion In a job, your personal growth and expansion is limited by the constraints of a company. You are not always rewarded in a way that is commensurate with your value. If you own a small business or are self employed, your expansion and your work are the same thing. This means that your work never goes unnoticed, and expansion is always possible.
No more time trading
Most people who are employed are paid for their hours. They swap 8 hours of their day for some money. This trade limits your growth, and means that the only way you can earn more money if by putting more hours in. One of the largest self employed benefits is that you can create income streams that keep ticking over even when you sleep. No more trading your time for money. The ability to be able to create value for others means that you are going to be paid upon how much value you can create. This is not an arbitrary figure that an organisation has put on you. This isn’t £x for 1 hour, this is the creation of real value for your clients. This is a liberating and fulfilling experience. You don’t become a millionaire by working for a million hours. You do it by creating a million pounds worth of value for others. This is possible when you are self employed! No more trading your time for money, time to start creating value!
Control Over Everything
As an employee your taxes, your tasks and so many other things are out of your control. When you are self employed you have control over all areas of your monetary life. For instance, with tax, you can use a tax calculator to figure out how much tax you earn, deduct what you are entitled to deduct. (Consulting your accountant first of course!) This can lead to paying less tax than if you are an employee. And this is just one area that you have added control! You will have control over your work hours, your availability, the time you spend with your family. Everything! This is a huge reason that people choose to live a self employed life. In a world where employment and the world economies are increasingly uncertain, to have control over your finances is an important step. So it doesn’t matter what your situation is currently in life, choosing to be self employed can be a great idea. The benefits are there, all that is required is for you to take action!
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
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!
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.
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!
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.
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.
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?
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
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!
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.
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.
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!
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.
One is required to notify HMRC using its Digital Disclosure Service with the following information.
· 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.
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.
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.
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.
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.
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.
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.
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.
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.
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.
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.
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.
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.
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.
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.