Solid Accounting,Bookkeeping, Consultancy...

This week's round up of accountancy and business news

HMRC VAT initiative

HMRC have issued further guidance for those who have failed to register for VAT including a reduced penalty if you register by 30 September.

http://www.hmrc.gov.uk/ris/vat/index.htm

 

ICAS condemns HMRC service for smaller businesses

Whilst service to larger organisations is considered good, ICAS say many smaller businesses are suffering from poor efficiency and effectiveness provided by HMRC.

http://www.contractoraccountants.com/2011/07/06/customer-service-at-hmrc-is-inadequate-says-icas/

 

HMRC update on PAYE penalties

HMRC have produced an update on PAYE matters including penalties for late submission of P11ds

http://www.tax.org.uk/media_centre/LatestNews-migrated/HMRC_weekly_PAY_Update_71

 

Soaring cost of holidays

The increase in fuel costs combined with the falling value of the £ means that holidays in Europe are much more expensive than a year ago.

http://www.thisismoney.co.uk/news/article-2013234/Millions-sunshine-holidays-hard-times-exchange-rate-makes-Europe-expensive.html

 

One third of Company Finance Officers (CFOs) are braced for double dip

A survey by Deloitte reveals that confidence amongst CFOs is at its lowest level since September 2008.

http://realbusiness.co.uk/news/third-of-cfos-expect-double-dip-recession

 

Higher Fuel price means we are cutting journeys

Figures from the AA reveal we bought a billion less litres of fuel in the first 12 weeks of 2011.  Whilst this is good news for the environment it won’t help the treasury to balance its books.

http://www.totallymoney.com/news/index.php/2011/07/fuel-sales-drop-by-one-billion-litres/

 

HMRC employees on trial

A whistleblower has claimed that HMRC staff deliberately inflated business tax bills to increase bonuses.

http://www.accountancyage.com/aa/news/2086496/whistleblower-claims-hmrc-staff-ripped-businesses

 

Switching bank accounts to get easier

The payments council has announced new measures to be phased in over the next 2 years to make it easier to switch banks

http://www.moneysavingexpert.com/news/banking/2011/07/switching-bank-accounts-to-be-made-easier

Your Accountant – Interested partner or impersonal tool

Being in business means making decisions.  Whether it is the exact shade of paint to add a touch of gloss to a product or the need to purchase equipment or sadly make someone redundant, business life is full of choices and the need to be decisive. 

 

Sometimes we are so bound up in the need to make decisions that the important choices can be swept aside, taking the easy and quick over the slightly more time consuming.  Unfortunately one such choice often revolves around appointing a business accountant.  Over a period of time the choice of accountant can make a huge difference to your business success.  So when looking for an accountant here are a few points that you might want to consider:

 

• How important it is that your accountant is local to your business (within 10miles)?  Does it really matter whether your accountant is local to you or hundreds of miles away?  We believe that it does.  Having a local accountant means that they are more likely to understand your client base, your business culture and the challenges that you face on a daily basis.   Local accountants are more likely to act as a source of introductions to potential clients or suppliers as well as having a rapport with the local bank manager which may help when finance is required.
  
  
• How important is to actually meet you accountant regularly?  Is an accountant just for number crunching time or for life?  This is another benefit of having a local accountant as you can use them as a quasi-partner in the business.  Impartial and yet committed to your success you can bounce ideas off your accountant, ask for guidance and use your accountant to help in the long term planning of the business.  Often your accountant will be able to suggest cost savings or smoother processes which save time.
  
  
• Are London accountants affordable and competitive enough with accountants outside London?  Many people believe that an accountant with a London postcode will be expensive.  This is simply not true.  Whilst there are some very expensive accountants around they tend to deal with the larger PLCs.  In general accountants in London specialising in smaller businesses are fully aware of the costs and challenges of operating a business in London and therefore tend to keep prices as low as possible.
  
  
• Why shouldn’t I just use an online company?  Whilst there are a number of accounting services available, some with telephone or online advice attached, they are successful because they rely on having a large turnover of fairly simple accounting processes.  We believe that your accountant should be so much more than that.  They should understand your business, be involved with your business and constantly be on the look out for ways to improve the long term growth and success of your business.  However, we also recognise that the availability of an accounting package is a help and we provide our clients with free access to a good accounting package that will help with day to day tasks as well as keeping end of year costs down.

 

• Nationwide or chain accountant firms, do they provide a personalised service or do they treat clients like numbers?  No matter how good the intent, the larger the firm the higher the turnover.  This means that you have just got your accountant trained in fully understanding your business and they move on.  At Solid Ltd we pride ourselves in providing a personal and friendly service on a long term basis for our clients. 

This week's round up of accountancy and business news

Farwell to the cheque guarantee card

From 1 July the cheque guarantee card has ended its over forty year reign over our cheque payment system.  Although cheques can still be used without a cheque card it is expected that many retailers will refuse to accept them and ask for alternative forms of payment.

http://www.moneysavingexpert.com/news/shopping/2011/06/cheque-guarantee-cards-to-be-abolished-tomorrow-

 

HMRC admits that one in six still pay incorrect tax

The Revenue have admitted that one in six of us still pay the wrong amount of tax as they prepare to send out demands to 1.2million people.  On the plus side 3.5 million are due to receive rebates.

http://www.thisismoney.co.uk/money/news/article-2009220/One-STILL-pays-wrong-tax-admits-H-amp-M-Customs.html

 

National Insurance Cards fall to cost saving measure

From July HMRC will be sending out a letter confirming NI numbers rather than issuing a plastic card.

http://www.totallymoney.com/news/index.php/2011/06/ni-cards-bite-the-dust/

 

Unemployment down as private firms start hiring

The latest unemployment figures show private firms are hiring at the rate of 1,100 per day.  If you are considering taking on more staff but want to reduce the salary calculation burden consider asking your accountant to take on the payroll calculations.

http://www.thisismoney.co.uk/news/article-2003714/Private-firms-hiring-1-100-workers-day-Biggest-jobless-fall-decade-brings-ray-hope.html

 

Keeping an eye on fraud

Research by KPMG has revealed that the fraud against a company is most likely to be carried out by a 36-45 year old senior finance person.

http://www.contractoraccountants.com/2011/06/29/is-your-40-year-old-finance-manager-a-typical-fraudster/

 

HMRC toolkit launched

HMRC have launched the 20^th toolkit in their series designed to help agents and taxpayers in completion of assessments and returns.  This final one focuses on business profits.

http://nds.coi.gov.uk/clientmicrosite/Content/Detail.aspx?ClientId=257&NewsAreaId=2&ReleaseID=420189&SubjectId=36

 

HMRC compliance centres

A reminder from the Chartered Institute of taxation about the HMRC compliance centres and their function.

http://www.tax.org.uk/media_centre/LatestNews-migrated/HMRC_Compliance_Centres

What to expect from your accountant

When you start up in business it is tempting to think that you don’t need an accountant, that figures should be fairly straightforward and that preparing your own accounts is one easy way to save money.  Very soon the reality of complex legislation and time consuming HMRC returns sets in and the thought of using an accountant becomes more desirable.

 

The fact is that using an accountant can save not only money but time thereby allowing you to concentrate on your business.  But with so many accountants available just how do you choose which accountant will suit you best?  After all, standard accountancy services including Accounting • Bookkeeping • Payroll • CIS • Self Assessment • Tax Returns • VAT Returns are offered by most accountants.  So what sets one accountant over another?

 

At Solid Limited we never lose sight of the fact that we are there to serve our clients not the other way round.  We continuously strive to work to our three founding aims and believe our clients have the right to expect us to meet these goals at all times.  Our aims are:

 

To provide personalised accountancy solutions

We understand that your business is your business and that every business is unique.  For that reason we work with you to identify the level of accounting support that is right for your business.  As your business grows we are there to provide the changing levels of support that you need.  For example as your turnover grows you may move into the VAT bracket or may take on staff and need help with payroll calculations and returns. 

 

Whatever your needs, the important thing is that the solutions offered and associated charges are right for your business so if you don’t need VAT services then we won’t charge you for them.

 

To provide a superior level of customer service

There are far too many business relationships in this world which depend on a reference number and little else.  We believe that the relationship between client and accountant cannot work in this way and will only succeed when it is based on true partnership.  The deeper understanding we have of both you and your business the more we can help you to succeed. 

 

Understanding only comes through regular dialogue and meetings.  This helps us to help you to remain on top of your changing accounting needs as well as enabling us to be proactive in bringing marketplace and regulatory changes to your attention.

 

To provide all the advice and support our clients need

Following on from providing superior levels of customer service comes the need to provide advice and support to help our clients to understand and grow their business.  Our clients know that they can contact us at any time for support and guidance.  As part of this support package we offer free access to and training in the “KashFlow” software accounting package.  This provides you with an accounting package whilst at the same time helping us to monitor and manage your accounts.

 

Of course, the worry is that advice and support may come at a price.  We understand the need to monitor and control costs and how this might affect business decisions.  Because of this we offer fixed price or fixed monthly support packages.  That way you know how much you will have to pay and there will be no surprises.

By meeting our founding aims we are confident that Solid Ltd is providing its clients with not just basic accountancy but a partnership that will grow and develop as the business develops.  We believe you have the right to expect this from your accountant whether you are a one man band or a larger organisation.   Whilst it is naturally in our financial interests for you to succeed, we take it as a point of pride to help you to grow a strong business which will be there for years to come. 

This week's round up of accountancy and business news

30^TH May is tax freedom day

According to the Adam Smith Institute in 2011 we have all worked for the Tax man from 1 January to 29 May, a total of 149 days and three days longer than in 2010.

http://www.citywire.co.uk/money/tax-freedom-day-dont-work-for-the-man-any-longer/a495481

 

Late paid PAYE, a cautionary tale

Although penalties for late payment of PAYE commenced in April 2010 it is only now that the full impact will start to be seen.

http://www.accountingweb.co.uk/topic/tax/late-paid-paye-ticking-bomb/500793

 

Company cars advisory fuel rates

HMRC have published new advisory fuel rates to take effect from 1 June.

http://www.hmrc.gov.uk/cars/advisory_fuel_current.htm

 

Do SMEs want to borrow

As the big 4 banks come under fire for failing to meet lending targets the chairman of the UKs newest bank says demand just isn’t there

http://www.thisismoney.co.uk/news/article.html?in_article_id=535064&in_page_id=2

 

Financial Ombudsman compensation limit increased to £150,000

The FSA have increased the claim limit to £150,000 from £100,000 as part of a package of measures designed to drive up standards

http://www.citywire.co.uk/money/financial-ombudsman-compensation-limit-increased-to-150000/a495445?ref=citywire-money-latest-news-list

 

Fraud against the Government soars

According to the KPMG fraud barometer fraud against the Government has soared by 142% in the last 3 years with tax fraud leading the way.

http://www.kpmg.com/UK/en/IssuesAndInsights/ArticlesPublications/NewsReleases/Pages/Public-exchequer-plundered-as-Government-targeted-fraud-soars.aspx

 

Disguised Remuneration legislation is too complex

The Chartered Institute of Taxation has hit out at changes to the new disguised remuneration regulations as being too complex.

http://www.contractoraccountants.com/2011/05/25/chartered-institute-of-taxation-hits-out-at-hmrc/

30^TH May is tax freedom day

According to the Adam Smith Institute in 2011 we have all worked for the Tax man from 1 January to 29 May, a total of 149 days and three days longer than in 2010.

http://www.citywire.co.uk/money/tax-freedom-day-dont-work-for-the-man-any-longer/a495481

 

Late paid PAYE, a cautionary tale

Although penalties for late payment of PAYE commenced in April 2010 it is only now that the full impact will start to be seen.

http://www.accountingweb.co.uk/topic/tax/late-paid-paye-ticking-bomb/500793

 

Company cars advisory fuel rates

HMRC have published new advisory fuel rates to take effect from 1 June.

http://www.hmrc.gov.uk/cars/advisory_fuel_current.htm

 

Do SMEs want to borrow

As the big 4 banks come under fire for failing to meet lending targets the chairman of the UKs newest bank says demand just isn’t there

http://www.thisismoney.co.uk/news/article.html?in_article_id=535064&in_page_id=2

 

Financial Ombudsman compensation limit increased to £150,000

The FSA have increased the claim limit to £150,000 from £100,000 as part of a package of measures designed to drive up standards

http://www.citywire.co.uk/money/financial-ombudsman-compensation-limit-increased-to-150000/a495445?ref=citywire-money-latest-news-list

 

Fraud against the Government soars

According to the KPMG fraud barometer fraud against the Government has soared by 142% in the last 3 years with tax fraud leading the way.

http://www.kpmg.com/UK/en/IssuesAndInsights/ArticlesPublications/NewsReleases/Pages/Public-exchequer-plundered-as-Government-targeted-fraud-soars.aspx

 

 

Disguised Remuneration legislation is too complex

The Chartered Institute of Taxation has hit out at changes to the new disguised remuneration regulations as being too complex.

http://www.contractoraccountants.com/2011/05/25/chartered-institute-of-taxation-hits-out-at-hmrc/

This week's round up of accountancy and business news

Urgent reminder for employers

HMRC have issued an urgent reminder for employers to submit their Employer Annual Returns online by 19 Mary or face a penalty.

http://nds.coi.gov.uk/clientmicrosite/Content/Detail.aspx?ClientId=257&NewsAreaId=2&ReleaseID=419393&SubjectId=36

 

Banks accept PPI ruling

The British Bankers Association has announced it will no longer fight the High Court Ruling on PPI mis-selling.  Those in line for compensation could include the self-employed and people with pre-existing conditions.

http://www.moneysavingexpert.com/news/reclaim/2011/05/banks-throw-in-the-towel-on-ppi

 

NI holiday take up lower than estimated

Only 3,000 businesses have applied for NI contributions relief in the 6 months to end March 2011 against an expected take up of 132,000.

http://www.accountancyage.com/aa/news/2068915/nic-holiday-low

 

Banks still failing to lend to business

The Forum of Private Business claims that small businesses are not only failing to secure bank finance they are also unable to even negotiate a starting point.

http://www.contractoraccountants.com/2011/05/04/lending-to-small-businesses-should-be-decided-at-local-level/

 

Corporate Insolvencies continue to rise

Accounting Firm Baker Tilley has released statistics showing that corporate insolvencies have risen by 22% in Q1 2011 when compared to the previous quarter.

http://www.smallbusiness.co.uk/channels/small-business-finance/news/1622343/insolvencies-rise-among-smes.thtml

 

Credit card rates at 13 year high

According to Moneyfacts credit card rates increased by 2% in the first few months of 2011, leading to an average rate of 19.1%, the highest in 13 years.

http://www.totallymoney.com/news/index.php/2011/05/credit-card-rates-hit-13-year-high/

 

Public sector workers receive premium salaries

A recent survey has revealed that public sector workers receive between 4% and 20% more than comparable workers in private industries.

http://www.thisismoney.co.uk/news/article.html?in_article_id=532835&in_page_id=2

HMRC are not issuing a paper Budget Pack

Instead HMRC have published important information on their website which includes:

• Information from the Budget on 23 March 2011
• P7X (2011) - Tax codes to use following the Budget
• the latest edition of the Employer Bulletin (issue 38) April 2011
• the Basic PAYE Tools (formerly the Employer CD-ROM), and
• how to start your payroll for 2011 -12 by using our helpsheet P9X (2011) Tax codes to use from 6 April 2011.

To find out more go to http://www.businesslink.gov.uk/employerpackandbulletins

This week's round up of accountancy and business news

HMRC publishes VAT changes document following Budget

HMRC have published a document summarising changes to VAT following the recent Budget.  If in doubt then contact your accountant for clarification on how these changes may affect you. 

http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageLibrary_ShowContent&propertyType=document&id=HMCE_PROD1_031225

 

Treasury Select Committee to reopen Cheques enquiry

Amid concern from small businesses and the public on the phasing out of cheques by 2018, the Treasury Select Committee has reopened its enquiry on the feasibility of the plan.

http://www.moneysavingexpert.com/news/banking/2011/04/treasury-committee-to-reopen-cheques-enquiry

 

Credit control still challenging

Figures from Experian show that businesses are still experiencing delays in receipt of payments, albeit down to an average of 25.2 days late against 25.7 days late the previous quarter.

http://www.smallbusiness.co.uk/channels/small-business-finance/news/1618488/no-rest-for-credit-control-.thtml

 

International accounting standards for SMEs consultation

The consultation period on a potential change in international accounting standards for SMEs finishes at the end of April

http://www.accountancyage.com/aa/news/2043640/sme-accounting-standards-poised-international-revamp

 

HMRC sending out threatening letters

HMRC have started to send out letters demanding payment of unpaid taxes under threat of bailiffs.  If you receive a letter contact your accountant immediately.

http://www.thisismoney.co.uk/tax/article.html?in_article_id=530715&in_page_id=11

 

Businesses now have right of appeal to banks if refused loans

The business finance taskforce has brought in procedures to allow an appeal if a request for finance has been turned down by one of the big 5 banks.

http://www.contractoraccountants.com/2011/04/14/business-finance-taskforce-appeal-system-set-to-benefit-smes/

 

Inflation falls for first time in 7 months

The fall in CPI inflation to 4.0% and RPI inflation to 5.3% was good news for the markets and may help to stave off interest rate rises.

http://www.citywire.co.uk/money/falling-inflation-will-it-last/a486122

Negotiating the complexities of payroll

Whilst the announcement by the Chancellor, George Osborne, that he intends to investigate the merging of regulations for tax and national insurance (NI) is welcome, any likely improvements in this area will take some time come into effect.  In the meantime with a new tax year upon us bringing with it a raft of regulation changes, accounting for payroll still takes up a sizeable amount of administration time.

 

One of the quickest ways to create employee dissatisfaction is to incorrectly calculate their payroll and tax rates.  Not only will this involve employees in potentially protracted correspondence with HMRC, a cumulative error could leave them with a sudden tax bill and no means of paying.  Although there are a number of payroll calculation programmes available, some still require manual amendments when regulations change and even those with automated updates still require a measure of payroll knowledge to make sure that errors don’t creep in.  Even the online payroll calculation software available from HMRC is not foolproof and in fact is generally not rated as among the better payroll programmes.

 

Keeping up with HR and payroll issues can be a full time job.  The recent spring pay alert issued to employers includes reminders that from now on employers with fewer than 50 employees have to send starter and leaver forms (P45s, P46s etc) online to HMRC.  Add in the fact that annual returns have to be filed online or face a fine and good payroll software becomes vital for the business.  Of course, payroll software costs money and the total cost of the software and employee time taken in calculating payroll can be a drain on a business.

  One answer is to hand over the administration of your payroll to your accountant or a specialist payroll bureau leaving you free to concentrate on building your business.  Payroll specialists not only have IT systems which are geared up to tax and NI calculation, they keep up to date with legislation changes as a matter of course.  Outsourcing payroll is not expensive, for example outsourcing to Solid Limited will cost just £20 per month for up to seven monthly paid employees.

 

The other benefit of outsourcing is that along with the basic payroll you also hand over all the statutory returns that go with it.  Late and incorrect returns will result in your being fined by HMRC and could also lead to your business facing a tax audit.  Outsourcing specialists are geared up to making sure you submit your returns on time.

 

In addition to current reporting requirements HMRC have recently announced that they are to go ahead with a real time information pilot starting in 2012 and with the aim of being rolled out to all employers by October 2013.  This will involve on line reporting at the same time as employees are paid, potentially leading to 52 returns each year for weekly paid employees.  Apart from basic reporting, those involved in payroll at present have to deal with end of financial reporting with HMRC deadlines for the end of the 2010/11 tax year as follows:

• 19 April – Final PAYE and NI payments to reach your HMRC tax office with electronic payments to be cleared into the HMRC account by 21 April.
• 19 May - Employer Annual Return – P35 & P14.  These give details of pay and deductions for the year and are generally submitted on line.  You do need to notify HMRC even if you have no P35 or P14 return to make.
• 31 May – Each employee must be given a P60 which is a summary of earnings and deductions.  For the first time this year as an alternative employers can give employees on line access to electronic P60s
• 6 July – Expenses and benefits forms P11D, P9 have to be filed with HMRC and given to employees.

This week's round up of accountancy and business news

This week's round up of accountancy and business news

HMRC misses effects of new pensions in PAYE codes

Nearly 150,000 pensioners face requests for unpaid tax thanks to HMRC ignoring new pensions when sending out tax codes for the 2010/11 tax year.

http://www.accountingweb.co.uk/topic/paye-codes-missed-out-pensions/490150

 

Planned downtime could affect submission of VAT returns

With planned downtime in the HMRC VAT system from 1-6 April and in particular with the VAT return portal being completely unavailable on 4-5April businesses should plan their submission carefully.

http://www.tax.org.uk/media_centre/LatestNews-migrated/VATonlineservicedowntime%e2%80%93update

 

ISA deadline is Midnight 5 April

The deadline for applying for an ISA for the tax year 2010/11 is midnight on 5 April.  While some institutions are staying open and will accept payments by debit card up to that time the earlier you can invest the better to avoid IT and phone glitches.

http://www.thisismoney.co.uk/savings-and-banking/ask-an-expert/article.html?in_article_id=500847&in_page_id=111

 

Paying HMRC changes

From 1 April there are a number of changes to the way in which HMRC payments are made including Corporation Tax, VAT, Class 2 NI contributions and PAYE.

http://www.hmrc.gov.uk/news/pay-hmrc-april11.htm

 

Cost of Banking needs clarification

The Treasury select committee recommends that the cost of operating a bank account is made clearer to encourage banking competition.  This should run alongside a simpler process for transferring bank accounts.

http://www.moneysavingexpert.com/news/banking/2011/04/banking-system-isnt-working-says-treasury-committee

 

Proposed payroll reforms summarised

With the Government determined to simplify the payroll system this article contains an overview of the key proposals currently under consideration.

http://www.accountingweb.co.uk/topic/tax/proposed-payroll-reforms-overview/488662

 

Budget decision to retain IR35

The decision in the budget to retain IR35, the measure of whether someone is a freelancer or worker, has disappointed those looking for clarification but may help to encourage the entrepreneurial Britain aspired to by the Government.

http://www.citywire.co.uk/money/tax-decision-to-keep-ir35-rules-disappoints-freelancers/a482348