News
| 23-04-2024
For accounting periods beginning on or after 1 April 2024, a new merged scheme for research and development tax credit comes into force. The new merged scheme replaces the old RDEC and small and medium-sized enterprise (SME) schemes.
| 23-04-2024
Prior to the tax year starting each 6 April, HM Revenue and Customs (HMRC), will issue new tax codes to employees, usually where there is a change of tax code. These tax codes, a series of letter and numbers, allow employers to deduct the right amount of tax
| 10-04-2024
Keeping your accounting records up to date can feel like a chore, but when your bookkeeping is kept up to date, you and your business can gain some significant benefits.
| 10-04-2024
The Low Pay Commission (LPC) has published a report on the future of the National Minimum Wage beyond 2024. In recent years, the LPC has been setting the National Living Wage based on a target of two-thirds of median hourly earnings.
| 10-04-2024
HM Revenue & Customs have recently updated and clarified their guidance on training costs paid by the self-employed. The general rule for whether the cost of a training course can be deducted from your
| 10-04-2024
When in business, itâs not uncommon to be approached by another business with a view to you buying the business or entering a partnership deal. It might be a competitor that approaches you, or it could be a customer or supplier.
| 02-04-2024
The Department for Environment, Food & Rural Affairs (Defra) and the Forestry Commission have announced a significant uplift in England Woodland Creation Offer (EWCO) payments. The uplift is intended to promote an increase in tree-planting across the country. It takes effect
| 02-04-2024
Last week, HM Revenue and Customs (HMRC) announced changes to its helpline services that will encourage people to go online first. However, in a fast about turn, the very next day they halted these changes while they consider how best to help taxpayers make more use of online services.
| 02-04-2024
The original concept for national insurance contributions (NICs) was as a part of social welfare reforms implemented by the government in the early 20th century. The idea being to establish a social insurance that provides financial protection and assistance to individuals and families when sick or unemployed
| 02-04-2024
The Prime Minister, Rishi Sunak, has announced reforms to apprenticeships that will enable up to 20,000 more apprenticeships and could be especially welcome news to small businesses. With effect from April 1st, the government will pay the full
| 02-04-2024
The new tax year begins on 6th April and for employers running monthly payrolls, the March pay run will be the last of the 2023/24 tax year. There are some things you will need to make sure you do and know when you need to do them
| 02-04-2024
Thresholds based on a companyâs accounts and employee numbers determine whether a company is categorised as small or not. Being able to qualify as a small or medium sized business can cut red tape for a business with the reduced amount of both non-financial and financial reporting a small or
| 02-04-2024
When there are several shareholders, a new company is being formed, a shareholder wants to pass their shares or pass them to their children, someone is nearing retirement,
| 20-03-2024
2024 seems to be a good year to be a small business. The UK Government is doubling down on its commitment to the nationâs 5.5 million small businesses by announcing the launch of a new Small Business Council.
| 18-03-2024
Multiple Dwellings Relief (MDR) is a stamp duty land tax (SDLT) relief that is currently available if you buy two or more residential properties in a single transaction or a series of linked transactions.
| 18-03-2024
The new measures allow Companies House to combat the criminal acts and money laundering being carried by criminals abusing the company registration system. The powers include being able to query
| 18-03-2024
The Charity Commission has published new guidance designed to help charities when they face decisions over whether to refuse or return a donation.
| 18-03-2024
Business and employees are both constantly looking for ways to optimise their financial strategies. One often overlooked strategy in
Download our latest Newsletter here
Get in touch
For accounting periods beginning on or after 1 April 2024, a new merged scheme for research and development tax credit comes into force. The new merged scheme replaces the old RDEC and small and medium-sized enterprise (SME) schemes.
The new scheme reduces the amount of benefit that would generally have been received under the old scheme.
Loss making R&D intensive SME companies can also benefit from additional support through Enhanced R&D Intensive Support (ERIS). Broadly speaking, if a companyâs R&D expenditure amounts to at least 30% of its total expenditure then it may qualify as R&D intensive.
HMRC has published guidance on how to claim, but if you need any help with an R&D claim or wonder if your business could make a claim, please contact us at any time and we would be happy to help you.
Guidance on the merged scheme and ERIS can be found here:
https://www.gov.uk/guidance/research-and-development-rd-tax-relief-the-merged-scheme-and-enhanced-rd-intensive-supportPrior to the tax year starting each 6 April, HM Revenue and Customs (HMRC), will issue new tax codes to employees, usually where there is a change of tax code.
These tax codes, a series of letter and numbers, allow employers to deduct the right amount of tax to be deducted from each employee when the payroll is run. That is, unless the tax code isnât correct. Therefore, it pays to check that the tax code has been calculated correctly.
The tax code notice usually sets out what has been included. For instance, it will usually include a personâs annual tax-free personal allowance.
What do the numbers and letters making up the tax code mean?
Numeric component
This usually represents the amount of tax-free income an individual is entitled to in a tax year. For example, a tax code of 1257L indicates a tax-free allowance of ÂŁ12,570 for the tax year.
Letter component
This letter indicates specific circumstances or adjustments that apply to the individualâs tax code.
Some common letter codes include:
- L â the individual is entitled to the basic tax-free allowance.
- M â marriage allowance is being transferred from a spouse or civil partner.
- K â additional deductions are being made from the individualâs pay, such as underpaid tax from previous years or tax on benefits in kind.
It is important to check that a tax code is correct to avoid overpaying or underpaying tax.
If an employee believes their tax code is incorrect or needs adjusting, such as due to a change in personal circumstances or income, they can contact HMRC directly to request a review or update of their tax code. HMRC will then make any necessary adjustments and send an updated tax code to use in subsequent payroll calculations.
If you need any help with your own or your employeesâ tax codes, please do not hesitate to contact us. We will be very happy to help you.
Keeping your accounting records up to date can feel like a chore, but when your bookkeeping is kept up to date, you and your business can gain some significant benefits. Letâs review a few:
Financial clarity
Regular bookkeeping ensures that your businessâ financial transactions are accurately recorded, categorised, and updated regularly. Having up-to-date information can give you insights into your businessâ financial health and help you to make informed decisions about your business with confidence.
Budgeting and planning
By tracking your income and expenses, it will be much easier to develop a realistic budget, set your financial goals, and allocate money effectively. Accurate financial data can help you to reach your goals.
Compliance and tax management
Proper bookkeeping makes sure that you comply with tax and, if applicable, company law. When your accounting records are kept accurately and are up to date, it makes tax return preparation easier and reduces the risk of mistakes with their resulting penalties.
Monitoring cash flow
Keeping up-to-date records or income and expenses allows you to monitor your cashflow. Tracking inflows and outflows of cash enables you to identify trends and anticipate cash shortages or surpluses. This means you can be well placed to take proactive measures when you need to manage your cash through a tight spot.
Forecasting and managing cashflow is essential for financial stability and meeting the short-term obligations of your business.
Identifying financial trends and patterns
Over time, good quality bookkeeping will provide you with valuable insights into trends and patterns. This will help you to identify areas of strength and weakness, and spot emerging trends.
You may be able to evaluate how effective a marketing campaign was, or what difference a pricing adjustment makes. These trends and patterns can be a great help in your strategic decision making.
Good bookkeeping is not just a back-office task, but rather is a fundamental aspect of business management and growth. When you invest in robust bookkeeping systems and processes, you lay the groundwork for financial stability, sustainability, and prosperity in the long run.
If you need help with any aspect of your bookkeeping, please give us a call. We will be happy to help you!
The Low Pay Commission (LPC) has published a report on the future of the National Minimum Wage beyond 2024.
In recent years, the LPC has been setting the National Living Wage based on a target of two-thirds of median hourly earnings. The National Living Wage is now set to reach this target, and so the LPC is now reporting to the government with advice on what its next steps on National Minimum Wage could be.
One of their recommendations is to reduce the difference between the youth and adult rates. From April 2024, the minimum age for National Living Wage was brought down from 23 to 21. The LPC are suggesting that this should be further reduced so that the adult rate will apply to anyone over 18 years old.
The LPC also feel that the Apprentice Rate could be removed. However, they acknowledge the risks this would bring if this were done at the same time as reducing the gap between youth and adult rates for non-apprentices.
Therefore, they are suggesting that the Apprentice Rate is kept, but for those aged over 18, it changes to a discount of the age rate during the apprenticeâs first year. This will still mean that the cost of training is acknowledged in the pay rate but allows for an increase in wages.
To see more about the LPCâs proposals, please see: Â https://assets.publishing.service.gov.uk/media/6603e9009741c5001139dc1a/The_National_Minimum_Wage_Beyond_2024.pdf
HM Revenue & Customs have recently updated and clarified their guidance on training costs paid by the self-employed.
The general rule for whether the cost of a training course can be deducted from your self-employed profits is that it must be incurred wholly and exclusively for the purposes of the trade being carried out by the business at the time that the training is undertaken.
If you are self-employed, a training course that updates or provides expertise or knowledge in your existing business area will normally be deductible. This means that training on new skills or knowledge for you to keep up with changes in your industry, or to help you keep up with advances in technology can be allowable.
In addition, training on subjects that are ancillary to your main trade can be allowable too depending on the circumstances. As an example, a plumber who books a training course on bookkeeping or digital skills would likely be able to deduct the cost of those courses from his self-employed profits.
Where a training course is to give an individual skills to start a brand-new business, or to add a new, unrelated business area to their business, then HMRC view them as not allowable.
To see some examples of expenses and whether they are likely to be allowable or not please see: https://www.gov.uk/guidance/check-if-the-cost-of-training-could-be-an-allowable-business-expense
When in business, itâs not uncommon to be approached by another business with a view to you buying the business or entering a partnership deal. It might be a competitor that approaches you, or it could be a customer or supplier.
Alternatively, you might identify a business that you would like to acquire as part of your own growth plans. What things should you consider before entering a deal to buy another business? In this article we will look at some of the key considerations.
Financial assessment
What is the financial health of the business you are looking to acquire? To answer this properly means reviewing accounts, cash flow projections, debts, assets, and liabilities.
Doing a detailed review of these will put you in a good position to understand the financial status of the business. You will learn what working capital is needed by the business, how realistic any projected ventures might be when compared with past performance, and whether there are any hidden liabilities. All this will help you determine the true value of the business and any potential risks involved.
Legal compliance
Ensuring that the business you are looking to buy complies with all their legal and regulatory requirements is essential. You do not want to run the risk of a problem relating to non-compliance coming out after you have purchased the business and then being liable for it.
Permits, licences, contracts, intellectual property rights, and any ongoing legal disputes should all be explored.
If you can identify any legal issues upfront, this will help you to mitigate risks and avoid future problems.
Evaluate how the business operates
Assessing the operational aspects of the business helps you to understand its strengths, weaknesses, and operational efficiency. This includes looking at the processes, systems and infrastructure of the business. You should also explore its supply chain and customer base, as well as its human resources.
Evaluating how a business operates beforehand can help you to decide whether it is a good fit for your business or if there will be difficulties integrating the business with your own processes.
Market analysis
Clearly where you are relying on the target business to increase overall business income, then you need to know how this will be accomplished. You will want to analyse what the competition is for the business, what its current market share is and its potential for growth. Being knowledgeable about industry trends is also important in assessing the marketability of the business.
As you understand the market dynamics of the business you are looking to buy, you will be in a stronger position to assess future opportunities and put together appropriately targeted strategic plans.
Customer and supplier relationships
Evaluating existing customer and supplier relationships helps you to understand how dependent the business is on them, and to know whether there are any potential risks. For instance, reliance on a single customer or supplier may be undesirable.
This kind of evaluation can also help you to work out what customer satisfaction levels and the businessâ brand reputation is like.
Employee assessment
It is vital to review employee contracts, benefits, turnover rates, and the culture of the organisation. This can help you assess whether there are any potential HR challenges you need to be aware of. You can also get a sense of how the employees in the new business will be able to fit and work with your existing team.
Synergy analysis
Evaluating potential synergies between your business and the new business may reveal opportunities for saving costs, enhancing income streams, and efficiency gains. This could mean that the new business will offer you more value than an initial glance might indicate.
In conclusion, there is a lot to consider when looking at buying or entering into partnership with another business. However, thorough due diligence can pay dividends in minimising risks, maximising opportunities, and making sure that the acquisition will bring you success.
As expert business advisors, we have helped with carrying out due diligence in many business acquisitions. Please feel free to give us a call to find out how we can help you!
The Department for Environment, Food & Rural Affairs (Defra) and the Forestry Commission have announced a significant uplift in England Woodland Creation Offer (EWCO) payments.
The uplift is intended to promote an increase in tree-planting across the country. It takes effect immediately and offers more tailored tree-planting incentives to farmers and land managers, while also protecting food production farmland.
Currently the maximum rate per hectare available from additional contributions is ÂŁ8,000. This will increase to ÂŁ11,600 â a 45% increase.
Further new measures include a new Low Sensitivity Land Payment of ÂŁ1,100 per hectare. This can be stacked onto the above payment if applicable to give a total of ÂŁ12,700 per hectare.
To encourage planting or the natural colonisation of highly biodiverse woodlands next to ancient woodland, a new âNature Recovery â Premiumâ option of ÂŁ3,300 per hectare is being added to the Nature Recovery Additional Contribution.
Other additional contributions, such as those relating to riparian buffers and flood mitigation and access, have also seen uplifts. As has the annual maintenance payments, which have been increased to ÂŁ400 per hectare, per year, for 15 years.
As expert accountants for the farming and land management industry, please feel free to talk to us at any time for advice that could help your business be more profitable.
Details of the new rates can be found here: Â Â https://www.gov.uk/government/news/payment-rates-increased-to-benefit-farmers-land-managers-trees
Last week, HM Revenue and Customs (HMRC) announced changes to its helpline services that will encourage people to go online first.
However, in a fast about turn, the very next day they halted these changes while they consider how best to help taxpayers make more use of online services.
The changes HMRC are proposing apply to Self Assessment, PAYE and VAT services. Feedback though suggests that there is still a significant number of people who are reluctant to deal with their tax affairs online.
HMRC are keen to pursue online services because of the cost savings they bring. They revealed that last year they received more than three million calls on queries that could have been carried out online, including on questions such as resetting an online password, getting a tax code, or finding out a National Insurance number.
The changes they are proposing include:
- Closing the Self Assessment helpline between April and September and directing callers to self-serve using online services.
- Opening the Self Assessment helpline between October and March for priority queries. Straightforward queries will still be directed to HMRCâs online services.
- Opening the VAT helpline for 5 days each month ahead of the deadline for filing VAT returns. At other times, callers will be directed to use online services.
- The PAYE helpline no longer taking calls on refunds.
- Having HMRC advisers continue to be available to support those who cannot use online services or need additional support because of their health or personal circumstances.
Jim Harra, HMRC Chief Executive, said: âMaking best use of online services allows HMRC to help more taxpayers and get the most out of every pound of taxpayersâ money by boosting productivity. ⊠However the pace of this change needs to match the public appetite for managing their tax affairs online.â
If you need any help in dealing with HMRC, please feel free to get in touch and we will be pleased to help you.
See: https://www.gov.uk/government/news/hmrc-helpline-changes-halted
The original concept for national insurance contributions (NICs) was as a part of social welfare reforms implemented by the government in the early 20th century. The idea being to establish a social insurance that provides financial protection and assistance to individuals and families when sick or unemployed, or in old age.
The National Insurance Act of 1911 required workers and their employees to start making contributions to a national insurance fund, which was to be used to finance various benefits.
The national insurance system has been further expanded and refined since then, but now in 2024 national insurance contributions could well be on their way out.
NICs was the hot topic of last yearâs Autumn Statement and this yearâs Spring Budget, with the rates for employee NICs and those charged on self-employed profits significantly cut. Class 2 NICs â a set rate of contribution paid by all self-employed businesses with profits above a certain threshold â has also effectively been abolished.
In the Spring Budget, the Chancellor, Jeremy Hunt, identified NICs on the earnings of the self-employed and employees as paying tax twice. He indicated that, when possible, the government would continue to cut national insurance.
This thought was further emphasised in a speech the Prime Minister, Rishi Sunak, gave last week at the 2024 Business Connect Conference. He said: â[The governmentâs] long-term ambition is to simplify the system and end the double tax on work, by abolishing NICs.â
After outlining the recent cuts, he concluded by saying: âWeâre not done yet. Weâll make more progress towards abolition, in the next Parliament.â
NICs therefore seem likely to be an ongoing topic in the run up to a general election, likely to be held in the autumn. This is perhaps the death knell for NICs, but also raises questions about how tax will be levied to offset a reduction to NICs.
If you need help optimising your tax strategies so that you pay the minimum of tax or national insurance, please talk to us. We will be happy to help you!
The Prime Minister, Rishi Sunak, has announced reforms to apprenticeships that will enable up to 20,000 more apprenticeships and could be especially welcome news to small businesses.
With effect from April 1st, the government will pay the full cost of training for anyone up to the age of 21.
If you are a small employer this will mean that you no longer need to meet some of the training costs and may mean that taking on an apprentice becomes more viable.
Education providers will also benefit as they currently need to source funding both from businesses and the government.
Gillian Keegan, Education Secretary, commenting on the reforms said: âApprenticeships are a fantastic way for businesses to develop the skills they need, and these new measures will help more businesses and young people benefit from them.â
See: https://www.gov.uk/government/news/prime-minister-to-announce-major-reform-package-to-boost-apprenticeships-and-cut-red-tape-for-thousands-of-small-businesses
The new tax year begins on 6th April and for employers running monthly payrolls, the March pay run will be the last of the 2023/24 tax year.
Some things you will need to make sure you do and when you need to do them are listed below:
- Send your final payroll report of the year to HM Revenue & Customs (HMRC). You may need to mark in your payroll software that this is the final submission for the tax year.
- Update your employee records before 6th This may include new tax code notices. If your software automatically updates tax code notices, then check these to make sure they are accurate.
- Update your payroll software. If you use a desktop application to run your payroll then it will need updating from 6th April or whenever your software provider tells you to do so. If you use browser-based software to run your payroll then it is unlikely that you will need to run an update, but you should check.
- Give your employees a P60 by 31st May at the latest.
- Report employee expenses and benefits by 6th July at the latest.
If you need any help with your end of year payroll procedures or would like help or advice on preparing your report of employees expenses and benefits, please get in touch with us and we will be happy to help you.
See: https://www.gov.uk/payroll-annual-reporting
Thresholds based on a companyâs accounts and employee numbers determine whether a company is categorised as small or not. Being able to qualify as a small or medium sized business can cut red tape for a business with the reduced amount of both non-financial and financial reporting a small or medium sized business is required to do.
The Prime Minister, Rishi Sunak, has announced that there will be 50% uplift to the current thresholds that determine a companyâs size. The government expects that this will benefit up to 132,000 businesses.
The current thresholds were set by the EU, who recently uplifted its thresholds by 25%. However, following Brexit, the UK has greater freedom to set its own thresholds and so is opting for a larger increase.
It is intended that the new thresholds will apply to financial years that start on or after 1 October 2024.
The new thresholds mean that a company with less than ÂŁ632,000 turnover will now qualify as a micro-entity. A small company will be one with turnover less than ÂŁ15m, and the upper medium threshold will increase to ÂŁ54m. Companies with a turnover above ÂŁ54m will be classified as large.
If you want to know how these changes might affect your company, please call us and we will be happy to help you.
See: https://www.gov.uk/government/news/prime-minister-to-announce-major-reform-package-to-boost-apprenticeships-and-cut-red-tape-for-thousands-of-small-businesses#:~:text=This%20includes%20increasing%20the%20number,and%20non%2Dfinancial%20reporting%20requirements.
When there are several shareholders, a new company is being formed, a shareholder wants to pass their shares or pass them to their children, someone is nearing retirement, or the company has borrowed money from a shareholder, issues can easily arise that jeopardise the continued success of a business.
Shareholder agreements are crucial documents that set out the rights and responsibilities of shareholders within a company. These agreements, which are often overlooked, have a significant influence in shaping the trajectory of a business and safeguarding the interests of both shareholders and the company itself.
In this article we look at the areas where a good shareholder agreement can benefit a business and its shareholders.
Defining rights and responsibilities
A good shareholder agreement clearly outlines the rights and responsibilities of each shareholder within the company. This includes details such as voting rights, dividend distribution, and obligations related to financial contributions or management responsibilities.
With these parameters established upfront, shareholder agreements provide clarity and can minimise potential conflicts and disputes among shareholders.
Mechanism for resolving conflicts
While business ventures start with all good intentions, almost inevitably disagreements can arise among shareholders on important business decisions or operational matters. Such disputes can end up paralysing a business and hold it back from reaching its potential.
Shareholder agreements typically include mechanisms for resolving conflicts, such as mediation, arbitration, or predetermined procedures for making decisions. Because there is then a structured framework for dealing with conflict, the agreement helps reduce the risk that a dispute could escalate to the point of disrupting the business.
Protection of minority shareholders
Shareholder agreements often include provisions designed to protect the rights of minority shareholders. Generally, decisions within a company are decided by majority vote. Therefore, if a company has a single or a small group of majority shareholders, they are able to control all decisions made.
This may not be desirable in all scenarios, and actions could be taken that disproportionately benefit majority shareholders.
Therefore, an agreement may include provisions that ensure minority shareholders have a say in certain key decisions, and safeguards against certain actions that could unfairly disadvantage minority shareholders. The agreement can therefore promote fairness and equity within the company.
Keeping the company on track
The stability and direction of a company can be helped by a shareholder agreement. It might be used to establish guidelines for significant corporate actions, such as mergers, acquisitions, or changes in company structure.
The agreement might require certain decisions to be approved by a specified majority of shareholders and so prevent a single individual taking an action that might undermine the companyâs strategic objectives or corporate governance.
Succession planning and business continuity
The long-term sustainability of any business relies on changes in ownership or management being well planned for.
Shareholder agreements often address succession planning by outlining procedures for transferring shares, resolving disputes related to a transition in ownership, or specifying how a buyout must happen in the event a shareholder leaves or dies.
With the clarity and certainty these provisions can bring, a business is in a much better place to be able to continue with minimal disruption.
Confidentiality and non-compete clauses
A shareholder may decide to leave the company and set up on their own or move to a competitor. In this circumstance, a shareholder agreement can help to protect the companyâs confidential information and prevent shareholders doing something that might harm the business.
The agreement might include clauses that help safeguard the companyâs intellectual property, trade secrets, and competitive advantage. These can all help the company keep its market position and reputation.
In summary, a good shareholder agreement can provide a company with a comprehensive framework that helps it remain stable and fair while bringing long-term success to both the business and its shareholders.
Please talk to use if you need help in planning for an agreement. We can help with a list of key areas to consider, as well as with share and company valuations and putting the wishes of the shareholders into an agreement with a local solicitor.
2024 seems to be a good year to be a small business. The UK Government is doubling down on its commitment to the nationâs 5.5 million small businesses by announcing the launch of a new Small Business Council.
Small businesses are the backbone of the UK economy, comprising 99.9% of all businesses and supporting a staggering 27 million jobs across the country, with an annual turnover of ÂŁ4.5 trillion. Recognising their pivotal role in the UK economy, the government has declared 2024 as the year of the SME.
The Small Business Council is tasked with working alongside the Prime Ministerâs Business Council to tackle key issues facing small businesses. The Council will provide an opportunity for small business leaders to have direct access to the government.
The Council will include organisations dedicated to helping small businesses, such as Small Business Britain, the Federation of Small Businesses and Family Business UK, as well as representatives from SMEs themselves.
In addition to establishing the Small Business Council, the government has revamped the Help to Grow campaign and website to provide a comprehensive resource hub for small businesses. This âone-stop shopâ aims to simplify access to vital information such as funding opportunities, webinars and guidance on setting up and scaling a business.
A 12 week programme, called the Help to Grow: Management Course, is also available and is designed to help with learning leadership and management skills. An additional course, Help to Grow: Management Essentials, will launch in April 2024. This will cater for micro-businesses and those that want a condensed version of the leadership course.
The government have also expressed a commitment to tackling the ongoing problem of late payments and providing financial support through schemes like the start-up loan scheme and business rates relief. Accessing finance and dealing with large businesses who do not pay in a timely way can be significant issues for small businesses, so this support will be most welcome.
The Help to Grow website can be found here: https://helptogrow.campaign.gov.uk/
Multiple Dwellings Relief (MDR) is a stamp duty land tax (SDLT) relief that is currently available if you buy two or more residential properties in a single transaction or a series of linked transactions.
It allows the rate of tax to be calculated based on the average value of the properties purchased rather than the aggregate value, which saves SDLT on the overall purchase.
The relief was originally intended to promote investment in residential property and increase the amount of private rented houses available. However, an external review initiated by the government has concluded that the relief has not really helped with these aims.
Therefore, the Spring Budget announced that MDR will be abolished with effect from 1 June 2024.
Provided the contracts on a purchase you might be currently undertaking were exchanged before 6 March 2024 (Budget Day), and thereâs no change in the contracts afterwards, then MDR can be claimed regardless of when the purchase completes.
Obviously, MDR can also apply to any purchases where the contracts have not yet exchanged but the transaction will complete before 1 June 2024.
If you need help working out whether MDR can apply to your purchase please feel free to get in touch. We will be happy to help you.
New powers for Companies House based on the Economic Crime and Corporate Transparency Act 2023 (ECCT Act) finally came into force last week.
The new measures allow Companies House to combat the criminal acts and money laundering being carried by criminals abusing the company registration system.
The powers include being able to query information and request supporting evidence, make stronger checks on company names, and tackle and remove factually inaccurate information.
It will no longer be possible for a company to use a PO Box as their registered office address, and Companies House now have the ability to share data with other government departments and law enforcement agencies.
The new measures are accompanied by new criminal offences and civil penalties to help with their enforcement.
It is hoped that the new measures will not cause too much additional hassle for genuine businesses.
The ECCT Act also introduces other measures, including identity verification and accounts reform, but these will not be introduced until a later date.
See: https://www.gov.uk/government/news/companies-house-begins-phased-roll-out-of-new-powers-to-tackle-fraud
The Charity Commission has published new guidance designed to help charities when they face decisions over whether to refuse or return a donation.
Generally, the starting point for a charity is to accept donations given to the charity. However, they are certain circumstances where they must refuse a donation and the new guidelines help to make this clearer.
The guidelines set out the type of donations that legally must be refused or returned. These include donations received from illegal sources or come with illegal conditions. An example would be where the donation has come from terrorist or other criminal activity.
Other situations where there is a legal obligation to refuse or return a donation include where the donation:
- has come from someone who does not have the mental ability to decide to donate.
- cannot legally be given to the charity. This might happen if the donor does not actually own what they are donating.
- has terms requiring its return. For instance, a donation might have a term that it must be used within a certain period of time, which would require any unused funds to be returned at that time.
There are, though, other reasons why a charity might be likely to need to refuse or return a donation, and these are discussed in the guidance. The guidance also reviews steps that a charity might be able to take so that it can accept the donation.
The guidelines are available to review here: https://www.gov.uk/guidance/accepting-refusing-and-returning-donations-to-your-charity#what-we-mean-by-a-donation
Business and employees are both constantly looking for ways to optimise their financial strategies. One often overlooked strategy in doing this is salary sacrifice.
Salary sacrifice involves an agreement between an employee and their employer to reduce the employeeâs salary in exchange for certain non-cash benefits. While it may seem counterintuitive at first glance, salary sacrifice can be a useful tool for saving taxes for both parties involved.
Benefits for the business
For a business, implementing salary sacrifice schemes can lead to good tax savings. For instance, offering non-cash benefits such as pension contributions or cycle-to-work schemes in exchange for salary can reduce employersâ National Insurance contributions. This lowers the overall tax burden for the business.
The benefits to the business are not just confined to the tax savings though. Offering attractive benefits through salary sacrifice can enhance feelings of job satisfaction for employees and improve staff retention.
Benefits for the employee
From an employee perspective, salary sacrifice offers a number of tax-saving opportunities. By opting to receive non-cash benefits instead of additional salary, employees can reduce their taxable income and so reduce the tax they pay.
For instance, contributions to a workplace pension are deducted from the employeeâs gross salary before tax is applied. Therefore, if an employee sacrifices some of their salary to make additional pension contributions, the amount of tax they pay will reduce.
Furthermore, salary sacrifice arrangements can enable employees to access valuable benefits that they might not otherwise be able to afford.
Are there any downsides?
While salary sacrifice can be a good tax saving strategy, it is not suitable for every situation.
Many salary sacrifice schemes are caught by tax regulations or have set requirements, so it pays to understand these and make sure a scheme will be suitable for your business. Employees too need to carefully assess their individual financial circumstances and priorities before entering into salary sacrifice agreements.
In conclusion, salary sacrifice can be a win-win for both businesses and employees. Business can use non-cash benefits to reduce their tax liabilities while enhancing employee satisfaction and retention. Meanwhile, employees can enjoy tax savings and access benefits they find valuable and that contribute to their overall well-being. With careful planning and implementation, salary sacrifice can be a powerful tool for businesses and their employees.
We have tools that can help you calculate the tax consequences and any potential savings from salary sacrifice arrangements involving company cars, pensions, and bikes.
Please feel free to get in touch and we will be happy to help you!
