Further changes to the PSC register

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The People of Significant Control (PSC) register is changing again.

Since 26 June 2017, directors are required to update their PSC register at Companies House within 28 days of any change to keep their register ‘current’.

However, this information will no longer be included in the confirmation statement, and companies are required to keep their registers up to date using forms PSC01-09.

These changes are very important and any directors who fail to comply may face a fine or even a prison sentence of up to two years.

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

Making Tax Digital Delayed until 2020

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The Treasury have delivered what is potentially good news for many (yes, you have read that correctly).  Making Tax Digital, or MTD to give it its affectionate moniker, has been both delayed and reduced in terms of requirement.

For businesses that are VAT registered, VAT returns will still have to be submitted via MTD compatible software from 1 April 2019, but in terms of quarterly reporting for tax and national insurance (NI) purposes,  MTD has been delayed until at least April 2020.

The new timetable for income tax and NIC reporting is as follows, although the £85,000 small business threshold is subject to change.

Annual turnover

Old timetable

New timetable

Over £85,000

6 April 2018

At least April 2020

From £10,000 – £85,000

6 April 2019

At least April 2020 but on a voluntary basis

Companies

1 April 2020

At least April 2020

It appears that the Government have quite enough on their plate without launching MTD and undoubtedly many taxpayers will welcome the delay!

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

Should You Be a Registered Charity?

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There are thousands of charities around the UK and, although we often only hear of the few high profile charities that appear in media coverage, there are also many very small charities whose main purpose is to help local causes.

Some charities are ‘excepted’ from charity registration providing their annual income is below £100,000, an example being Scout and Guide groups. There are also some organisations that have their own regulatory body and are therefore ‘exempt’ from charity registration. A full list of ‘excepted’ and ‘exempt’ charities can be found on the Charity Commission website.

If a charity is not one of the few listed as ‘excepted’ or ‘exempt’, and has an income over £5,000 per year, it is a legal requirement for it to register with the Charity Commission.

There are concerns that many charities start off with small ambitions or single projects, but soon progress with fundraising and setting new goals for future years, and often exceed the £5,000 limit without realising.

If you have any questions on whether you should be registered with the Charity Commission please contact us.

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

Tax and Your Company Car

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There are many factors which will influence your choice of company car. These can include the distance you travel, terrain covered, the price, your lifestyle and perhaps even your clients. However, is tax ever a consideration?

The start of the tax year saw an increase in the company car rates and indeed the rates are increasing quite significantly year on year. Assuming however that you have some degree of choice over the car make and model, you can influence the tax that you pay.

The two factors which determine the tax charge attached to a company car are the list price of the vehicle and its CO2 emissions.

The table below shows the benefit in kind charge for cars with various, hypothetical,  list prices and CO2 emissions.  The rates applicable to the current tax year (2017/18) have been used.

List price CO2 emissions Fuel type Benefit in kind value
£17,000 102g/km Petrol £3,230
£25,000 99g/km Petrol £4,500
£25,000 117g/km Diesel £6,250
£35,000 0g/km Electric £3,150
£50,000 41g/km Electric/Petrol £4,500
£50,000 155g/km Diesel £16,500

In addition to the company car benefit there is also a fuel benefit if the employer provides fuel for private use; the value of the fuel benefit is affected by the CO2 emissions but not by the list price.

Although tax will not be the only issue affecting your choice of company car, perhaps it ‘auto’ be a consideration?

If you’d like any more information please contact Green & Co Accountants.

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

Insight into Foresight

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Budgeting is an essential tool used to monitor a business. It allows business owners to monitor what the business is actually doing, compared to what it wants to do. This seems a rather straight forward concept to understand, but it can often be met with scepticism when it comes to setting a budget. The “trying to predict the future” concept is inevitably an impossible task and is probably why most business owners feel it is a wasted exercise. This is a common misconception, as budgets need not be exact, but merely indicative.

The idea behind setting budgets is to help carve out a path to follow in the coming year. It allows you to think about where you want to take the business and how you are going to achieve it. Once these questions are answered, the budget simply shows you what the expected financial results would look like. Over the year, you can identify whether the business is following that predetermined path you carved out, or whether it is straying off and needing to be reined in.

Thinking about your business in this way is immensely productive. It will often identify opportunities and threats currently present and force you to think proactively to try and capitalise on the opportunities and manage the dangers.

In today’s economic climate, uncertainty is increasing, which makes the budgeting process more complex. However, here at Green & Co we pride ourselves in helping clients achieve their goals. With our insight into budgeting techniques, we can help you carve out that path for your business.

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

Don’t Be a Lottery Loser – Protect Your Syndicate Winnings

 

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If you and your employees club together to take a chance on the Lottery by operating a workplace syndicate, but you do not have a formal agreement in place, a large win could cause tax issues in the future.

If ever you are fortunate enough to win the jackpot, the winnings will undoubtedly be collected and distributed by a nominated individual, normally the same person who buys the tickets.  However, if by some stroke of misfortune, that person dies within 7 years of the win, HMRC could argue the distributions were technically gifts, particularly if no written agreement exists.  In that event the gifts would be treated as failed Potentially Exempt Transfers (PETs) and therefore subject to Inheritance Tax.

Admittedly this is not an everyday occurrence, but it can happen, and HMRC are likely to chase all those who shared in the winnings for any resulting liability.

Verbal agreements can of course be valid, but they are much more difficult to prove, so if you are a part of a syndicate, it is wiser to draw up a document, showing all members, the amount of the stake each pays and how any winnings are to be shared.  It should always be updated when new members join to ensure they don’t get caught out by the IHT trap.

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

HMRC Cash Crackdown

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HMRC has shopkeepers in its sights at the start of a new crackdown on cash payments.

Returns submitted to HMRC by shops and restaurants, whom it believes may not be declaring all of the cash payments they take, are to be crosschecked against the number of card payments taken.

HMRC estimate around 30% of transactions in these business are paid for in cash, and it is thought that investigations will centre on businesses recording more than 90% of their transactions are paid by card.

There are concerns, however, that the new plans could lead to lengthy and unnecessary investigations which could be financially damaging for small businesses.

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

Accountancy Firm Holds Free Seminar on Xero

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This weeks edition of the South Wales Argus features an article on our  Introduction to Xero Seminar.

Cwmbran-based accountancy firm Green & Co Accountants and Tax Advisors is holding a seminar on an introduction to Xero; the cloud-software product.

The free seminar will be held on Thursday, June 8 from 9am until 11am at Parkway Hotel in Llantarnam.

At the seminar, the team will outline what Xero is, the benefits of using the software and how it will help businesses become compliant in the run-up to Making Tax Digital; the government’s commitment to ensuring future tax data submitted by individuals and organisations are online.

The seminar, which will be delivered by Ian Phillips from Xero, is targeted at businesses who are using spreadsheets or offline bookkeeping methods, as well as those looking to understand a little more about Xero.

Ed Gooderham, director at Green & Co said: “We want to use this opportunity to communicate the numerous benefits of Xero to organisations; from micro-businesses to large corporations. The automation element of Xero not only minimises errors but saves valuable time and money whilst relieving administrative stress.”

If you interested in attending the event, contact Katie Williams on 01633 871 122 or email katie.williams@greenandco.com or register on Eventbrite.

Green & Co Accountants and Tax Advisors specialise in business growth and tax minimisation for businesses across Wales and the South West of England.

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

Introduction to Xero Seminar – 8 June 2017

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Does your business currently use Xero or are you considering moving your accounting to a cloud based system?

We would like to invite you to the Parkway Hotel and Spa in Cwmbran, on 8 June 2017, between 9am and 11am, to teach you how to utilise Xero to its full potential and how Xero can benefit your business.

Xero account manager, Ian Phillips, will be coming along to provide you with the following:

  1. A brief summary of Making Tax Digital
  2. An overview of what Xero is and how it can benefit your business.
  3. How to use Xero to streamline your businesses reconciliation process
  4. How to save time and money using Xero.
  5. Tips & Tricks to help you get the most from your accounting system
  6. Running reports to understand your business.
  7. Questions and Answer session to help answer any questions or problems you may be facing.

Eventbrite - Introduction to Xero: Seminar from Green & Co Accountants

For any enquiries about this event, please contact Katie Williams at Green & Co on 01633 871122, Email: katie@greenandco.com.

The Rising Tide of Auto Enrolment

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Over the course of the next two years Auto Enrolment Pension contribution rates are rising. These changes will affect you as an employer as well as your employees.

Currently the total minimum amount is 2% of qualifying earnings, of which the minimum for the employer to pay is 1%. This means that the employee normally also pays 1%.

From 5 April 2018, these rates will increase. The new total minimum will be 5%, with the minimum employer contribution rising to 2%. From 5 April 2019, they will rise again to 8% and 3% respectively.

Of course, both the employee and the employer can chose to pay more into the scheme should they wish. For instance, if an employer wishes to contribute to his employees’ pension the whole 2% currently prescribed, the employee would not need to add anything, as the minimum amount has been reached.

If you are staging soon, or have perhaps passed your staging date, and would like any help don’t leave it too late! Our dedicated payroll team will be happy to help ease the burden.

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