The Shrewsbury Accountants Blog – Taxassist Accountants in Sundorne

May 31, 2013

The Shrewsbury Accountants, TaxAssist in Sundorne, explain the benefits of accounting in the cloud

Filed under: accounting, online accounting, owner-managed businesses, Shrewsbury, shropshire, small business, start-up, start-ups — Tags: , , , , , , , , , , — taxassistshrewsbury @ 10:58 am

New and established businesses can benefit greatly from using an on-line (cloud based) accounting packages.

In our experience, choosing to work on-line rather than installing software on a local PC gives the following major benefits:

  • Reduced cost –No need to purchase hardware or accounting software. And unlike the conventional accounting software, it requires absolutely no updates.
  • Ease of access – All you need is an Internet connection!
  • Security – Your data is safe online. No need to worry about PC failures, theft or fires.
  • Improves Business Performance – Keep on top of money owed to you, work with your accountant on current data.

Please have a look at our software brochure and 24 page guide by clicking the links below:

Online accounting brochure

TaxAssist Accountants Online Bookkeeping Guide

We can give you a free 60 day trial. Thereafter the software costs just 50p per day (plus VAT).

Please contact us for more details. No more worrying about that old PC running unsupported software!

May 2, 2013

The Shrewsbury Accountant, TaxAssist in Sundorne, highlights cost increases for on-line traders

Filed under: owner-managed businesses, Shrewsbury, shropshire, small business — Tags: , , , , , , — taxassistshrewsbury @ 10:01 am

Luxembourg recently announced plans to raise its VAT rate from 15% (currently the lowest in the European Union). Whilst it is not yet clear what the new VAT rate will be,  a rise of 1% to 16% is widely forecast.

The new rate will take effect from 1st January, 2015.

On-line retailers, who are not registered for VAT, have to absorb the cost of Luxembourg VAT on Ebay and Amazon fees. This is a small but unwelcome addition to costs that needs to be planned for.

April 17, 2013

The Shrewsbury Accountant, TaxAssist in Sundorne, explains when you will need to complete a tax return

Filed under: Shrewsbury, tax, tax administration, Uncategorized — Tags: , , , , , , , , — taxassistshrewsbury @ 1:34 pm

I am grateful to Bob Edwards of Landmark Professional Development for producing this clear guide on when you are required to complete a personal tax return.

Please click on the link below to access it:

Filing check list

If you need further guidance, please do not hesitate to contact us

March 21, 2013

The Shrewsbury Accountant, TaxAssist in Sundorne, has summarised the Budget for local business owners

Filed under: accounting, Budget 2013, owner-managed businesses — Tags: , , , , , , , , , , , , , , , , , , — taxassistshrewsbury @ 1:11 pm

Please find below a link to our Budget Summary covering the key points of George Osborne’s fourth Budget that affect small business owners and taxpayers.

TaxAssist Accountants budget_summary_2013_21 March 2013

Some of the changes were mentioned in last December’s Autumn Statement and earlier Budgets, but there were also many new announcements. The main highlights of the Chancellor’s speech were:

  • From April 2014, all businesses and charities will be entitled to an Employment Allowance of £2,000 per year towards their employer National Insurance contributions (NICs) bill. This will particularly help small businesses who want to hire their first employee or expand their workforce
  • An increase in fuel duty of 1.89 pence per litre, originally planned for 1st September 2013, will be cancelled. This is great news for trades people and service providers who make home visits and are dependent on their vehicles
  • The Government had already pledged to increase the personal allowance to £10,000 by 2015/16, but today announced that this would be brought-forward a year and will now increase to £10,000 in 2014/15

We hope that this summary is easy to digest and proves useful.

A further article with reaction from Jo Nockells of our technical team is on our web-site here

If any of the areas discussed seem likely to have an impact on your personal or commercial plans, please do not hesitate to contact us.

March 4, 2013

The Shrewsbury Accountant, TaxAssist in Sundorne, have advice on salary levels and dividends for 2013/14

Filed under: accounting, limited company, owner-managed businesses, payroll, Shrewsbury, small business, tax, tax savings — Tags: , , , , , , , , , , , , , — taxassistshrewsbury @ 2:28 pm

Following the recent announcements from HM Revenue and Customs, I am pleased to put forward our recommendations for tax-efficient wages and dividends for the year beginning 5th April, 2013.

If you are the owner of a limited company, the most tax-efficient remuneration package is an annual salary of £7,692 and dividends of £30,382 (profits allowing). This assumes you have no other income. At this level, you will have no income tax to pay. The limited company will have been taxed on the dividend income. Dividends in excess of this amount will be taxed as 25%.

There are some formalities about dividend vouchers and board minutes which we would be happy to advise on.

You may recall that last year we advised a salary of £7,600 and dividends of £30,933 – £459 more than we advising for this year. This is because the higher-rate income tax threshold has been reduced to take account of the increase in annual personal allowance from £8,105 to £9,440.  National insurance thresholds have not benefited from the same increases as income tax thresholds. Annual wages between £7,692  and £9,440  will be subject to a combined national insurance charge of 25.8%, more than offsetting the Corporation Tax relief.

By substituting £1,748 of dividends for rents charged for a use of home office, an overall annual tax saving of £350 can be achieved. Please contact for more details if this suits your situation.

February 4, 2013

The Shrewsbury Accountant has some timely tax-saving advice to all residential landlords

Filed under: Shrewsbury, shropshire, tax, tax savings — Tags: , , , , , , — taxassistshrewsbury @ 1:46 pm

Now that HM Revenue and Custom’s formal consultation deadline has passed, it seems almost certain that a major tax relief (the renewals allowance for fixtures, furniture, furnishings and moveable equipment) available to taxpayers who let out furnished and unfurnished  houses will be withdrawn in April, 2013.

The allowance currently means that the like for like replacement of fixtures, furniture, furnishings and moveable equipment is tax-deductible against rental profits. This will not be the case after 5th April, 2013. So, if you own an unfurnished rental property and you know that, say, the cooker needs replacing, you should do it before April, 2013 to get tax relief.

Owners of furnished lets will continue to be able to claim the 10% wear and tear allowance.  This is in place of claiming the renewals basis for furniture, furnishings and moveable equipment.

However, owners of furnished lets will also see their tax bills rise, as it will not be possible to claim for the cost of renewing fixtures (which can currently be claimed in addition to the wear and tear allowance). Fixtures are things which would not normally be removed  if the property were vacated or sold (for example, baths, washbasins, toilets). As things stand, after 5th April, 2013, the cost of repairing a toilet is tax-deductible but not the cost of replacing it.

This is a complicated area. We hope this is clear. If you need further advice, please contact us.

December 7, 2012

The Shrewsbury Accountant, TaxAssist in Sundorne, has provided a summary of the Chancellor’s Autumn Statement

Filed under: autumn statement, owner-managed businesses, small business, tax administration — Tags: , , , , , , — taxassistshrewsbury @ 9:56 am

We have provided a simple summary of the measures recently announced. Please click this link:

autumn_statement to open the PDF file.

If you planning a large capital investment before 31st December, 2012, it is important that you take some advice.

If you want any further information on this or other matters, please do not hesitate to contact us.

December 5, 2012

The Shrewsbury Accountant offers more advice about company cars

Filed under: company car taxation, owner-managed businesses, shropshire, Uncategorized, VAT — Tags: , , , , , , , — taxassistshrewsbury @ 12:58 pm

In my previous article on this subject, I explained the opportunities and pitfalls in a employer providing a car to an employee. I explained the taxation effect of acquiring the vehicle either by outright purchase or on hire purchase.

One other commonly used option is for the employer to  take out a lease contract to provide the car to the employee. Again, tax relief depends on a vehicles CO2 emissions and there are some changes planned for future years.

Currently, a business can deduct 100% of contract hire costs against business profits provided that the car’s Co2 emissions are 160g/km or less. There is a disincentive to taking out a lease for a car with higher emissions as legislation states that only 85% of the leasing cost of these cars is allowed against tax. This adjustment is made on the Corporation Tax computation. Please be aware that this restriction with apply to cars with emissions over 130g/km for leases signed after 1st April, 2013.

You will be aware that VAT is charged on contract hire charges. Where the vehicle is used for business purposes, 50% of the VAT (not all of it) can be reclaimed. Again, this is a common area of confusion.  There is no distinction for VAT regarding CO2 emissions.

A common question about company cars is which is the best way of providing one to an employee – buy, take out an HP agreement or contract hire it. It is usually important to review a number of aspects of the business’s tax affairs in order to provide a clear answer.

I hope this article has given you some useful pointers on this subject. We would be happy to advise further.

In my next article, I will talk about the taxation of cars owned and used for business by sole traders and partners.

 

November 14, 2012

The Shrewsbury Accountant has some advice about company cars

Filed under: company car taxation, owner-managed businesses, tax savings — Tags: , , , , , , , , , , — taxassistshrewsbury @ 8:49 pm

In this article and future articles, I aim to give you a brief overview of taxation of company cars.

In this article will deal with tax from the employer’s point of view.

I will provide details for a business providing a car to an employee (who may be a owner/director). Different rules apply to cars used by sole traders and partners.

I will use the 2012/13 tax rates. Significant changes will take place in future tax years and I will highlight this.

Low emission vehicles

A business buying a new car (outright or on hire purchase) with CO2/km emissions of 110g or less can set the entire purchase amount against its profit. When sold, the proceeds may be non-taxable if there are sufficient assets (including cars) in the general pool (18%).

From April, 2013 the threshold will reduce to 95g CO2/km. We would advise that businesses act before it is too late. This link will give you list of these vehicles

http://www.comcar.co.uk/newcar/companycar/poolresults/110tax.cfm

Cars with higher emissions

The tax allowances for cars with higher emissions are much less generous. Cars with CO2 emissions between 111g and160g CO2/km will be pooled with other assets and receive a writing down allowance of 18% per annum. Over 3 years, the business will receive 45% of the cars cost back in tax relief. Typically, a car loses 65-70% of its value in this period.  This means that you will probably never get tax relief for this 20-25%.

From April, 2013 this CO2/km threshold will be reduced to 130g  CO2/km. If you have a car in mind with emissions between 131g and 160g CO2/km, we suggest you act quickly.

Cars with CO2 emissions over 160g CO2/km go into their own pool and receive a writing down allowance of 8% per annum. Over 3 years, the business will receive 22% of the cars cost back in tax relief. Typically, a car loses 65-70% of its value in this period.  This means that you will probably never get tax relief for this 43-48%. Shocking, isn’t it! These rules will apply for cars with emissions over 130g CO2/km with effect from April, 2013.

In my next article, I will outline the rules for leasing.

I hope you found this article informative. If you need further information including the double benefit of low emission vehicles, please do not hesitate to contact me.

November 6, 2012

The Shrewsbury Accountant, TaxAssist in Sundorne, offers some further advice on working from home

Filed under: accounting, limited company, owner-managed businesses, Shrewsbury, shropshire, small business, tax, tax savings — Tags: , , , , , , , — taxassistshrewsbury @ 11:11 am

We are often asked about the tax reliefs available for the costs incurred when working at home. In this and a previous article , I intend demistify this for you and, hopefully, help save you some tax (or at least stop you falling into some nasty hidden traps).

In the previous article, I explained the issues faced by a Director of a limited company when trying to claim tax relief to defray the costs of working from home.

The simplest route for a Director to obtain tax relief is to charge the limited company rent for the use of his own premises. There are formalities that need to be followed including a board minute and a formal rent agreement. The Director has to show this rental income on his self-assessment tax return but will be able to claim back the incremental costs incurred as a result of working from home. We recommend that the rent charged is the same as the incremental costs incurred as a result of working from home.

Sole traders and members of partnerships are able to claim tax relief (as a cost to their business) on the same basis on the self-employed pages of the tax return.

Calculating the incremental costs of working from home

You need to work out what rooms (or floor area) you use for business, and how much you’re using that room (or floor area) is for business use as opposed to private use. So lets say, you have 8 rooms and use 2 of them for business use 50% of the time. You will be able to claim 1/8th of your household costs as business costs (50% of 2 rooms = 1 room; total number of rooms 8).

Costs that can be claimed on this basis include:

  • Council tax
  • Heat and light
  • Cleaning
  • Home insurance
  • Mortgage interest
  • Rent, if you rent your home from a landlord
  • General household repairs and maintenance
  • Water rates, unless your business use of home is “minor”

Other costs you could claim include

  • Business telephone calls
  • A proportion of your landline rental
  • A proportion of your broadband

The claim would be based on your estimate of business v private costs.

There is some very good guidance on the HMRC web-site.

I hope this is article is useful. Please do hesitate to contact us if you require further information.

 

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