Divorce Complications For Owners Of Small-Medium Sized Enterprises (SME’s)

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The Office for National Statistics has identified a rise in divorce rates for those aged 40 to 44 and statistics suggest that most SME owners are aged 35 to 54.

You may not be aware that, in law, an interest in a business is a matrimonial asset so a divorcing spouse has a legal right to fight for their share. Also if you have an interest in a multi-shareholder SME the value of your interest in the company may be affected if one of the other shareholders divorces.

Case law has shown that the results can be severe. Along with the loss of your business share there are increased legal and accountancy fees in relation to share valuations and forensic accountants to represent the parties defending their interests.

Protection

Pre or post nuptial agreements are the key to clarity and honesty for all parties involved, directly or in-directly.

Being married without having a pre-nuptial agreement in place of course does not spell instant disaster. However, it may be prudent to suggest you and your business partners agree the terms of a post-nuptial agreement.

This can set out whether the business will form part of the matrimonial asset pot, how finance will be raised to cover the amount claimed and the timeframe of how and when that will be paid.

 

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Gwent Landlord Forum

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We’re excited to announce that our next Gwent Landlord Forum is taking place on Wednesday 25th May between 6 and 8pm at The Parkway Hotel and Spa.

Speakers will include:

Bethan Jones, Rent Smart Wales – All landlords operating in Wales must register themselves and all details of their rental properties with Rent Smart Wales before 23 November 2016.

Nicholas Webb, NLS Solicitors – Nicholas will be giving you details on the Immigration Right to Rent checks imposed on Landlords by the Home Office.

Emily Samuels, Serenliving – Serenliving will be introducing themselves and explaining how they are a letting agency with a difference.

Eventbrite - Gwent Landlord Forum

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Landlord Registration In Wales

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If you own a house that you do not live in, you may be regarded as a landlord for the purposes of the Housing (Wales) Act 2014.  In that case, you have until November 2016 to formally register as a landlord and depending on the management of that property, you may also need to become licensed as a landlord.

Learn more from Rent Smart Wales.

Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.

Image courtesy of Stuart Miles at FreeDigitalPhotos.net

 

 

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Cycle-to-Work Scheme: The Wheel Deal?

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Later this year, the government is expected to publish a white paper encouraging employers to take more responsibility for the health of their employees. Among the many incentives which can be offered is the Cycle-to-Work scheme.

The scheme is an annual tax exemption which allows employers to loans cycles and related safety equipment to employees as a tax-free benefit. Many organisations are missing the opportunity to derive employee health benefits from such schemes, instead tending only to promote them as ways to save when buying a bike. However, you as an employer could directly affect the transport habits of your staff, while also encouraging an active lifestyle.

The Cycle-to-Work scheme can include bicycles, tricycles, and electrically assisted pedal cycles; And it’s not limited to just the wheels and frame, but can also include helmets, bells, lights, mirrors, locks and chains, pumps, and much more. If an employee needs a cycle at either end of a train journey between their home and place of work, it is also possible to loan them two cycles.

While there is no limit on the total value of the equipment including the cycle, the Office of Fair Trading has advised that the group consumer credit licence will cover schemes up to the a value of £1,000.

Could your business benefit by promoting  Cycle-to-Work?

Doing so could deliver great benefits in terms of reduced sick days and fitter, more alert employees, so  maybe it’s  time your business geared up and took advantage of the scheme.

Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.

Image courtesy of Idea go at FreeDigitalPhotos.net

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To Pay Or Not To Pay – The National Living Wage

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The much talked about National Living Wage (NLW) was finally introduced on 1st April this year for 25 and overs. While the National Minimum Wage (NMW) will still apply to those under 25, the NLW is a higher rate of pay of £7.20 per hour and is designed to encourage a reduced reliance on state benefits. While it may have a different name, it is still a legally required minimum, and not a choice. Any employer who is found to be paying his employees less than either the NLW or NMW will face a penalty of 200% of the underpayment from 1st April.

While we have your attention, the National Minimum Wage rates have been released for October 2016. They are:

Age 21 – 24: from £6.70 to £6.95

Age 18 – 20: from £5.30 to £5.55

Age 16 – 17: from £3.87 to £4.00

Apprentice rate: from £3.30 to £3.40

Meanwhile the National Living Wage will not change in October 2016, as this only commenced from April.

Also worth noting is that from 2017, the date for all minimum wage increases will be in April each year. This is to bring the National Minimum Wage increase in line with the National Living Wage increases.

Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.

Image courtesy of dan at FreeDigitalPhotos.net

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What Is The PSC Register?

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What is the PSC Register?

With effect from 6 April 2016, all UK Companies, Societates Europaeae (SEs) and limited liability partnerships (LLPs) will be required to identify and record the people who own or control their company. Companies, SEs and LLPs will need to keep a register of people with significant control (PSC), in addition to existing registers, such as the register of directors and register of members (shareholders). The PSC information must be filed with Companies House.

What does a company need to do?

An officer of the company is required to:

  • Identify the PSCs and confirm their information;
  • Record the details of the PSCs on the company’s own PSC register;
  • Provide this information to Companies House as part of the annual Confirmation Statement (formerly the Annual Return); and
  • Update the information on the company’s own PSC register when it changes, and update the information at Companies House when the next Confirmation Statement is made.

Who is a PSC?

A PSC is someone who:

i.     has direct or indirect ownership of more than 25% of the shares in the company;

ii.    has direct or indirect control of more than 25% of the voting rights in the company;

iii.   has direct or indirect right to appoint or remove a majority of the board of directors;

iv.   actually exercises or has the right to exercise significant influence or control over the company; and/or

v.    actually exercises or has the right to exercise significant influence or control over activities of a trust or firm which is not a legal entity, which in turn satisfies any of the first four conditions over the company.

Example:

A company is owned by a brother and sister. They both have equal ownership and voting rights in the company. This means they each meet:

  • Condition 1 – They own more than 25% of the shares; and
  • Condition 2 – They hold more than 25% of the voting rights.

Both siblings must be entered on the company’s PSC register.

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Information you need to record on the register:

Before a PSC can be entered on the register, you must confirm all the details with them. The details you require are:

  • name;
  • date of birth;
  • nationality;
  • country, state or part of the UK where the PSC usually lives;
  • service address;
  • usual residential address (this must not be disclosed when making your register available for inspection or providing copies of the PSC register);
  • the date he or she became a PSC in relation to the company (for existing companies the 6 April 2016 should be used);
  • which conditions for being a PSC are met;
    • for conditions (i) and (ii) this must include the level of their shares and voting rights, within the following categories:
      • Over 25% up to (and including) 50%,
      • More than 50% and less than 75%,
      • 75% or more;
    • the company is only required to identify whether a PSC meets condition (iv) if they do not exercise control through one or more of conditions (i) to (iii);
  • whether an application has been made for the individual’s information to be protected from public disclosure.

Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.

Image courtesy of Stuart Miles at FreeDigitalPhotos.net

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Companies House Changes To Affect All UK Companies

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Confirmation Statement to Replace Annual Return

From June 2016, the Annual Return is being replaced. Instead, companies will now file a ‘Confirmation Statement’ at least once a year. You need to ‘check and confirm’ the company information held by Companies House and let them know if there are any changes.

There will be a fee to pay with the Confirmation Statement. You can update your record as many times as you need to, but there will only be a charge once a year.

For most companies, this will be the first time notifying Companies House of People with Significant Control (PSC). New companies will also provide this information on their incorporation documents.

People with Significant Control (PSC) Register – April 2016

Companies, Limited Liability Partnerships (LLPs) and Societas Europaeas (SEs) need to keep a register of People with Significant Control (‘PSC register’) from 6 April 2016.

A PSC is anyone in a company, LLP or SE who meets one or more of the conditions listed in the legislation. This is someone who:

  • owns more than 25% of the company’s shares
  • holds more than 25% of the company’s voting rights
  • holds the right to appoint or remove the majority of directors
  • has the right to, or actually exercises significant influence or control
  • holds the right to exercise or actually exercises significant control over a trust or company that meets one of the first 4 conditions.

Filing PSC information – 30 June 2016

Companies should already be keeping a ‘PSC register’ by this point. This information now needs to be filed with Companies House on incorporation and updated when you submit later ‘Confirmation Statements’.

If your company was incorporated before 30 June 2016, you will also need to provide this information on your first Confirmation Statement.

It is a criminal offence to not provide detail of PSCs. If you discover you do not have a PSC, or are still trying identify one, there will be forms you need to file to confirm this.

Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.

Image courtesy of Salvatore Vuono at FreeDigitalPhotos.net

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