Sheffield based Accountants and Business Advisers
Tel: 0114 288 0775     Email: info@firstaccountancy.co.uk

Free Offer for Nat West and Royal Bank of Scotland Customers


FreeAgent, the innovative award-winning cloud accounting company which is appropriate for freelancers and small businesses.

Free Agent has launched a new set of licences specifically for accountants with clients that bank with the Royal Bank of Scotland and NatWest.

Under the move, the company – whose award-winning software is designed for accountants working with small businesses and contractors – will now enable accountancy practices to add their new clients to FreeAgent for free, provided that they have either an RBS or NatWest business bank account.

Ed Molyneux, CEO and co-founder of Free Agent said: “We’re delighted to be able to now give accountancy practices throughout the country the chance to enjoy the benefits of our RBS and NatWest relationship.

More information on Free Agent is available on their website

Freeagent/

“Furthermore, as FreeAgent was recently added to HMRC’s list of software providers that are ready for the introduction of MTD for VAT, it also means that accountants and small business owners banking with RBS and NatWest now have access to a free, MTD-ready solution. We envisage that this will prove very popular.

For our clients, if they have a business account with the Royal Bank of Scotland and NatWest. We can set up free access to the software.

We can discuss with all clients about your requirements and can advise if the free agent software is suitable for your organisation or signpost you to one more suitable software if your requirements are more complex.

Make certain that you are not caught out as HMRC change the way you have to submit VAT returns.


From 1st April 2019 there is a major change affecting VAT registered businesses with a turnover of £85000, VAT submissions will now have to be submitted in a digital format, clients will no longer be able to use the HMRC portal to submit returns.

• All VAT businesses must keep their VAT records stored digitally
• VAT return must be sent via MTD compliant software, to help HMRC to interact digitally with the client.
• Help HMRC to tax in real time
• All VAT registered businesses will now have a single financial account for their business

VAT Notice 700/22 Making Tax Digital for VAT addresses the issue of what constitutes a digital record. Digital records of the required information can be kept in a range of compatible digital formats, but the transfer of that data must be digital.

If you are using software the accountancy software provider will ensure that these changes are integrated however the software MUST be the current version so many clients may have to upgrade which will bring added expense.

The good news is our clients do not need to worry about this as we can give advice and assist you.

We use the BTC MTD Solution, this enables us to validate and submit VAT in a MTD compliant format from a number of different sources.
Unlike many of the MTD solutions this has greater flexibility in working with bookkeeping software and spreadsheets. So this can help us meet MTD requirements, we can use your existing methods of work as it integrates as below:

• Integrates with VT Software
• Software integrates through API’s with Zero, Quichbooks , FreeAgent ,Reckon One etc
• CSV imports can also be imported from other programmes
• It is intended to be spreadsheet friendly so we will be able to import from spreadsheets (single and multiple)

We are happy to hear from you and look forward to answering your questions

HMRC Dynamic Tax Coding


HMRC have introduced computer controlled updates to tax codes which can affect your cash flow
The new system has recently started and a number of clients have received new tax codes for the current tax year ending 5th April 2018 . They do not seem to have coded into the calculations, anything about clients paying through self assessment,
A number of clients who have submitted Self Assessment returns have received tax coding to collect the money by 5th April 2018, so if these go through and the SA return is paid the client may pay twice.
This effects mainly directors of limited companies and employees with other incomes eg dividend income, property income etc
So if clients receive these codes they should contact their accountant to avoid problems.

Oops! HMRC software not working


We have an extremely complicated tax system, so is it any wonder that even HMRC struggle to calculate your tax correctly!

The way that allowances are applied for dividends, allowances, savings and other items all impact on each other.

Many tax payers will be working on their 2016/17 returns (to 5th April 2017 due by 31st January 2018) over the coming months and find that they can’t use the HMRC software because it doesn’t work properly.

As reported by Accounting Web

Rob Ellis, CEO of BTCSoftware, can’t remember a year when there have been so many exclusions from filing SA tax returns online. For the 2016/17 tax returns 16 new examples have been added to the online filing exclusions list, which is now in version 4; there is a version 5 of this list under construction.

You can read the full list of exclusions on this link

HMRC Article

Please contact us on 0114 2880775 for additional information

SA302 Madness


In order to get a mortgage, brokers and lenders ask employees for payslips and P60’s and for business owners they ask for SA302’s and Tax Overviews (often lenders also want an accountants certificate to certify the clients trading results).

The SA302 shows:

Pay from all employments

Profits from self employments Property Profits

Dividends

tax and National Insurance due

On the 25th August 2017 HMRC wrote

Agents have told us that not all their client’s lenders will accept the self-serve copy printed from their HMRC online account or the commercial software used to file the SA return, or their commercial software does not print.

 

A list of lenders who will accept self-serve copies can be found in the HMRC’s guidance, Mortgage providers and lenders who accept a SA302 tax calculation and a tax year overview.

 

It is always worth checking with the lender or mortgage provider what they require as evidence of income. And should another third party require a copy of the tax calculation, you may wish to ask if they accept a self-serve copy.

For additional information send for our newsletter or call 0114 2880775

 

10 reasons why you need a Business Plan in 2017


A business plan helps you to:

  • clarify your business idea
  • spot potential problems
  • set out your goals
  • measure your progress

Approximately a third of all SME’s in the UK don’t have a Business Plan, that’s about 1.5m businesses, so if you don’t have one, here are some reasons why you should prepare one.

1. Research shows that SME’s with Business Plans make 20% more profit
2. Having a business plan doubles your chances of increasing profits, increasing revenue, attracting new clients
3. A well-researched business plan which includes the right figures and realistic forecasts will reassure potential investors you are a sensible investment opportunity
4. A Business Plan will help you set out and achieve your goals
5. It will help you set goals for your managers and staff
6. The Business Plan will help you plan your cash flow and forecast Capital Expenditure
7. A Business Plan will help you secure Business Finance and Loans
8. You can plan your succession strategy or prepare the business for sale
9. A Business Plan tests the feasibility of your business idea
10. It will help you plan for the recruitment of Staff

Will your VAT Flat Rate go up in April?


A Low or Limited Cost Trader would spend less than 2% on gross turnover, or less than £1000 on the purchase of goods.

From April 2017 they will get a special 16.5% flat rate.

Here are some of the businesses likely to be affected

  • Accountancy and legal services 14.5%
  • Journalism or entertaining 12.5%
  • Computer or IT consultancy 14.5%
  • Business services not listed elsewhere 12%
  • Estate agents and property management 12%
  • Management consultancy 14%
The Flat Rate VAT scheme is very popular with small businesses.

The Flat Rate Scheme is designed to simplify your records of sales and purchases. It allows you to apply a fixed flat-rate percentage to your gross turnover to arrive at the VAT due.

Fixed-rate percentages vary depending on the type of business. [HMRC VAT Notice 733]

The scheme is for businesses with a turnover no more than £150,000 a year, excluding VAT.

The problem is that HMRC feel the scheme has been abused and used as a way to pay less VAT especially by businesses with virtually no costs.

There are lots of other VAT schemes to choose from

Standard VAT Scheme – on this scheme the VAT is based on tax points from invoices
VAT Cash Accounting Scheme – if your turnover is below £1.35m you can account for VAT on a Cash basis, this is particularly helpful if your customers pay you on slower terms than you pay your suppliers
Annual Accounting Scheme for VAT – if your turnover is below £1.35m you could join the Annual Scheme and complete one return for the year but you make either 9 interim payments or 3 quarterly interim payments
Retail VAT Schemes – These are specific schemes aimed mainly at shops and help to overcome the issues of mixed vat rate goods
VAT Margin Scheme – The margin scheme relates to second hand goods and accounts for VAT on the margin, for example on the sale of cars

They will all produce different answers!

Now might be a good time to make comparisons.

Why not give yourself or your staff a Trivial Benefit


Section 323A ITEPA 2003 sets out a statutory exemption for trivial benefits. Under this exemption, if an employer provides a benefit to its employees, the benefit is exempt from tax as employment income if all the following conditions are satisfied:

  • the cost of providing the benefit does not exceed £50 (or the average cost per employee if a benefit is provided to a group of employees and it is impracticable to work out the exact cost per person) (see EIM21865)
  • the benefit is not cash or a cash voucher (see EIM21866)
  • the employee is not entitled to the benefit as part of any contractual obligation (including under salary sacrifice arrangements) (see EIM21867)
  • the benefit is not provided in recognition of particular services performed by the employee as part of their employment duties (or in anticipation of such services) (see EIM21868)
  • Where the employer is a close company and the benefit is provided to an individual who is a director or other office holder of the company (or a member of their family or household) the exemption is capped at a total cost of £300 in the tax year (see EIM21869).

Here is an example

The Employer provides each of its employees with a bottle of wine costing £25 on their Birthday. However, as an alternative, it provides employees who do not drink alcohol with a £25 gift voucher for a national supermarket chain which they can exchange for an alternative non-alcoholic gift. Both the bottle of wine and the non-cash gift voucher can be covered by the exemption.

In fact, all shop vouchers that can’t be cashed in will count provided the value is £50 or less.

So why not make a list of special occasions:

Birthday
Christmas
New Year
Anniversary
Holiday
Easter

Buy a stock of vouchers and give them out.

This is a fantastic tax free benefit.

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