 To understand its importance, it is necessary to look at the scale of the matter with regards to small and medium sized businesses (SME’s).
In the UK, there are some 5.7m SME’s, which account for almost the whole of the private sector firms and 60% of total UK private sector employment. SME’s also account for 73% of all net private sector job creation in the UK. Therefore, SME’s have significant implications for the economy and anything that can effect SME’s is very important. SME’s need to be proactive and prudent as they prepare for BREXIT – deal or no deal. While some business know how they will be affected, and what will be the consequences. Many do not have the time to spare to look at this and seriously lack any plan of action of how to deal with and overcome weaknesses that may affect their business. This short article will focus on the most important aspects of leaving the EU without a deal for small businesses.
There are more questions than answers regarding impact of Brexit available yet. Ever lingering uncertainty and heightened anxiety in the business world in awash in the news at the moment. In any case, costs and delays relating to customs and trade are expected to increase in general. And these will affect all businesses and consumers. Some businesses may see their business grow and will look for new opportunities, but many are likely to lose out, if they do not plan ahead and manage their competitive position. By Awais at Tax Affinity Accountants in Epsom, Surrey Tax Affinity Accountants are experts in Tax and Accountancy. With branches in Surbiton , Worcester Park , Kingston upon Thames , Cheam and Epsom they are considered in the Industry to be expert accountants and tax advisors for small businesses. Helping and supporting business throughout the UK, they regularly help clients grow their business providing tailored advice and support. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.
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 Tax Affinity Accountants is pleased to announce that we have been awarded the Best Business of 2017, and have been recognised as one of the Top Service providers in our field of expertise by an Independent reviewing panel. A proud member of the Federation of Business this award was external to the FSB and a surprise award.
Independently recognised Our Worcester Park branch was commended for providing a consistently high quality service in our area of business (Tax and Accounting). The independent review team reviewed Tax Affinity Accountants using a 50-Point Inspection which included everything from checking reputation, history, complaints, ratings, satisfaction, trust and the cost to the general public. In short overall excellence. Unexpected review As you can image this has been a very pleasant surprise as we did not even know we were being independently reviewed and did nothing different from what we normally do. We were simply providing the best service we can as normal for every member of the public who approaches us for advice and support. Appreciation We would like to thank all of our customers for allowing us to be part of their lives and letting us help and support them and their businesses. We enjoy helping every self employed person and feel immense sense of pride and happiness when we see our clients businesses expand and grow. In some cases we have seen you guys start from absolutely nothing to a multi million pound turnover within a couple of years. Understanding all the hard work, and long hours it takes for each self employed owner to make their business a success. We have always been there to help and support you and congratulate you on your hard fought success. This award is also recognition for all the staff at Tax Affinity Accountants for going the extra mile and ensuring clients are 110% satisfied. Their long hours worked and late finishes to ensure each clients work is done on time and as tax efficiently as possible means this a reward for their hard work. And finally, we would like to thank the reviewers for their glowing recommendation and wish them the very best for the future as well. By Andrew Khan at Tax Affinity Accountants Tax Affinity Accountants are experts in Tax and Accountancy. With branches in Worcester Park, Kingston upon Thames, Cheam, and Surbiton they are considered in the Industry to be expert accountants and tax advisors for small businesses. Helping and supporting companies, contractors and self employed people throughout the UK, they regularly help clients with their payroll and pension. And help grow their business by providing tailored advice. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.  There is a lot of confusion with work place pensions and we are regularly being asked by employers to explain the process and answers questions they have. So to help, we have compiled a short list of questions and their brief answers below:
What is Work Place Pensions? A work place pension is a new compulsory government scheme to lighten the burden upon the state pension. It is part of the process of extending the retirement age and pushing away some financial responsibility onto employers away from the state. It is another way that employees contribute to a pension scheme separate from just the normal national insurance contributions to a state pension. The work place pension is arranged by an employer and they and you have to both contribute into if you decide to opt in. What is auto enrolment? Automatic enrolment to gives it full name, is the the compulsory way the Government has forced employers to set up a company pension scheme for employees. As the name suggest it makes it compulsory for an employer to automatically enrol all their eligible workers on their PAYE into a company pension scheme. What is the staging date? This is the date that the automatic enrolment duties begin. the staging date for an employer is worked out by the number of employees on their payroll (PAYE) based on information HMRC holds. The staging date has been set in law and is the date an employer needs to make sure their automatic enrolment duties have started. Which employees have to be on a work place pension? Only those employees that are over 22 years old and earn more that £10,000 per tax year, need to be enrolled on the work place pension. Anyone earning less than £10,000 a year on your PAYE does not have to be on the work place pension. How does is it work? Its like a normal company pension scheme, only difference is that the Government adds a little bit to it as well. An employer has to register and then choose a pension provider and then deduct a minimum of 2% (on a scale) from the employees wages each time a payslips is produced. The employer then adds an equivalent percentage (up to a maximum threshold) and then pays both the employees and employers pension payments to the pension company each pay date. The Government then tops this up with a lesser percentage. The total sits in a pension account for the employee until they reach retirement age and can then receive the pension payments at the required retirement age. Can employers and employees opt out? All employers have to register and be compliant with their legal obligations. But both directors and employees can 'opt out' of the work place pension scheme if they wish. If an employee wants to opt out then they need to fill in and sign an 'opt out' form and hand this to their employer. What are the costs? For an employee: Minimum 0.8% of an employees ‘qualifying earnings’, rising over time to 4% by April 2019 For an employer: Minimum 1% of your employees ‘qualifying earnings’, rising over time to 3% by April 2019 What is paid by the Government: 0.2% of your employees ‘qualifying earnings’, rising over time to 1% by April 2019 Plus the employer may have to pay a management charge to the pension company for managing the company pension scheme (varies with each company). And / or for the employees an annual pension management charge of 0.3% of their retirement pot, and a 1.8% charge from each payment that is made into an employees retirement pot. What is the earlier age an employee can start to get their pension paid to them? This differs from one pension company to the next and depends on the pension company used by the employer, but most pensions can start payout from aged 55 which is a lot lower than the state pension age and plans by the Government to raise the pension age further in the future. At Tax Affinity Accountants we are already helping hundreds of employers with their Work Place Pensions. Guiding them so they can make the most financially efficient strategy and plan for their company. If you would like help with this then get in touch and we would be happy to help. By Anni Khan at Tax Affinity Accountants Tax Affinity Accountants are experts in Tax and Accountancy. With branches in Worcester Park, Kingston upon Thames, Cheam, and Surbiton they are considered in the Industry to be expert accountants and tax advisors for small businesses. Helping and supporting companies, contractors and self employed people throughout the UK, they regularly help clients with their payroll and pension. And help grow their business by providing tailored advice. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.  If you work for the NHS or for Local Government and you are a contractor then you will have been notified that there will be changes coming in as of April 2017. We are increasingly being asked the same question by many clients who are confused and have not been advised correctly by their recruitment agnecy or end client. So we have compiled an easy bullet point guide below:
For a vast majority of contractors this means the recruitment agency or NHS / Council paying you has to decide how to pay you after April 2017. They may opt for the safest course of action / most profitable for them which may not be financially beneficial for you. And increasingly we are seeing a knee jerk reaction by most NHS and Council Management staff and recruitment Agencies is to incorrectly lable everyone the same even when HMRC does not say this in their rules. The vast majority of NHS and Council Management staff and recruitment Agencies are wrongly saying everyone is inside the scope for IR35 just because they cannot be bothered to work out who is and who isn't and they do not care if a person pays more tax than is really due. So have at look below at the correct options as per HMRC, that all contractors have in all ongoing negotiations:
By Anni Khan at Tax Affinity Accountants Tax Affinity Accountants are experts in Tax and Accountancy. Based in Worcester Park and Kingston upon Thames they are considered in the Industry to be expert accountants and tax advisors for small businesses. Helping and supporting business throughout the UK, they regularly help clients grow their business providing tailored advice. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.  Why go Limited?
We have all heard about IT contractors and consultants working through a limited company but so many more people could be saving themsleves a lot of tax also, just working this way. And as we get asked this question all the time, we've compiled a helpful list below: 1. If you are earning more than £43,000 a year then financially working through a limited company means your will pay less tax. Because the corporation tax rate is currently 20% and will fall 1% each year by 2020 dropping down to 17%, far lower than the basic 20% personal tax rate and much lower than the 40% higher rate due after £43,000. 2. A limited company means you have limited liablility and are legally seperate from your company and safer from any legal issues that may arise in the future. 3. It sounds much more professional if you are limited company to prospective clients and adds much needed credibility when working in most industry sectors. 4. You can sell shares in your company to investors and raise funding if required by approaching lenders for finance. 5. Protecting your business and brand name, a limited company registered at Companies House UK gives you the legal right to prevent the same name being used by any other business. 6. Pensions can be paid as an expense from your limited company. A big tax advantage over a self employed / sole trader business. 7. Selling a limited company, when you want to retire or move on, is far easier because it has physical presence and usually worth much more than a sole trader business. By Anni Khan at Tax Affinity Accountants Tax Affinity Accountants are experts in Tax and Accountancy. Based in Worcester Park and Kingston upon Thames they are considered in the Industry to be expert accountants and advisors for small businesses. Helping and supporting business throughout the UK, they regularly help clients grow their business providing tailored advice. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.  Reports have emerged that the abnormally large number, more than double the normal amount of companies were 'wound-up' in March 2016. It seems many company directors decided to act in advance of the changes to the tax rules that were introduced in April 2016.
From the 6th of April 2016 all directors in UK that are winding up a solvent company are now not allowed to claim entrepreneurs’ relief from the capital gains tax due on any gains, if they continue to work in the same line of business for the next two years. HMRC introduced theses changes to patch up a loop hole that allowed people to avoid income tax by saving up retained profits in a company, then winding it up. To pay a greatly reduced rate of Capital gains Tax (CGT) before starting up with a new company in the same line of work. Some industries had become so notorious for doing this that HMRC had to step in an stop the ability for everyone. The question of how many of these wound up businesses owners have already registered new companies doing exactly the same work again and how many were genuine cases may never be answered. But from our experience and perspective it certainly looks like the majority was for tax reasons. Entrepreneurs relief on capital gains tax allows tax to be charged at 10% rather than the higher standard rate and solvent liquidations accounted for 66% of all liquidations in March 2016, compared to an average of 35% over the previous two financial years. By Anni Khan at Tax Affinity Accountants Tax Affinity Accountants are experts in Tax and Accountancy. Based in Worcester Park and Surbiton they are considered in the Industry to be experts accountants for small businesses. Helping and supporting business throughout the UK, they regularly help new and established businesses to succeed. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.  Expert support can save you money with Capital Gains Tax Simply put Capital Gains Tax is a tax by HMRC on the profit you make when you 'dispose' of something of physical presence and value (an asset) eg a rental property, stocks and shares or a piece of art.
Eg you sell a piece of buy-to-let property for £300,000. Which you bought it for £200,000. Equals a capital gain of £100,000. A lot of people think it is only applicable in the case of a sale but according to HMRC it is applicable in other actions such as giving it away as a gift, transferring it to someone else, swapping for something else and getting compensation eg Insurance payment if it is damaged or stolen. Certain types of assets are eligible for capital gains tax while others are not. Your primary residence ie your home is not eligible for capital gains while a second property is. Some of the things on which you may need to pay Capital Gains Tax on are as follows:
But please note that depending on actual type of asset, you may be able to reduce any capital gains tax due by claiming a relief's that are available. There are many different types of reliefs and it usually best to visit a reputable accountant like Tax Affinity Accountants to make sure you take advantage of all the reliefs available to you. To help you HMRC has given everyone a tax free allowance after which capital gains tax will apply. Currently this is £11,100 for a Person and £5550 for a Trust for the 2015-16 Tax Year. Eg If your personal gain is £12,000 then deducting your personal allowance of £11,100 from the gain leaves you £900 on which capital gains tax can be charged. If you have any overseas assets then you may still have to pay Capital Gains Tax. There are however special rules if you are a British citizen or UK resident and are not domiciled in the UK whereby you can claim the ‘remittance basis’. If you living abroad then unfortunately you still have to pay tax on any gain you make on a residential property that is in the UK. This is even if you are declared as non-resident to HMRC. But the good news is that you do not have to pay Capital Gains Tax on any other UK assets, eg stocks and shares in UK companies, piece of art and business assets etc unless you return within 5 tax years of the gain. As capital gains tax rates can be either 18% or 28% of the gain depending on your personal income, it is a really good advice to speak to a qualified accountant as a good accountant should save you much more money than he/she would ever charge. At Tax Affinity Accountants we are one of the most recommended experts in Capital Gains Tax, due to our detailed knowledge of tax reliefs available and of the HMRC tax system. By Anni Khan at Tax Affinity Accountants. Tax Affinity Accountants are experts in Tax and Accountancy. Based in Kingston upon Thames they provide a bespoke service to client’s right across the UK and are considered in the industry to be experts in capital gains tax advice. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends.  After the conservative's won an outright majority in the recent UK elections. UK businesses heaved a sigh of relief from the usual months of economic uncertainty following an election particularly a coalition government. So much so that the FTSE 100 gained more than 1.6% the next day after the election with energy companies just some of the companies who saw their share prices rise due to the lack of the Liberal Democrats or Labour Party to curb gas and energy prices to consumers.
While big businesses will look forward to a lowering of headline corporation tax rates from 28% to 20%. Self employed and employed people enjoy little comfort in the knowledge that HMRC changes and tax reforms will be potentially harsher without a coalition partner to rein back the Conservatives. A decrease in personal income tax is only likely to materialise when the Tory government feels the UK economy is clearly safe from its deficit spectre and less prone to the economic problems as suffered by the economic union. The Prime Minister David Cameron has already made pre-election promises to leave a lot of taxes alone, but if he tries to fulfil on this promise then this means he doesn't leave himself and the Chancellor much in the way of options. Some of the pledges made by Mr Cameron were that there will be no increases in the rates of VAT, income tax or national insurance and that inheritance tax's zero rate band will increase to homes up to £1million. So in the short to medium term this simply equals a uncertainly for personal income tax payers that he will either change his election pledges or raise tax in other areas further burdening the average tax payer. By Anni Khan at Tax Affinity Accountants. Tax Affinity Accountants are experts in Tax and Accountancy. Based in Kingston upon Thames they provide a bespoke service to clients right across the UK and are considered in the industry to be experts in business advice. They mentor and support members of the public to make their businesses grow and reach their full potential. For more information visit www.taxaffinity.com. To read more interesting articles like this visit www.taxaffinity.com/blog. Please feel free to comment and share this with your friends. How to manage your finances so that you meet tax deadlines Certain things to bear in mind when tax deadlines are on the horizon are: 1) Keep all necessary paperwork organised and make sure to keep all paperwork even after the tax years passed as HMRC can put you under a tax investigation at any point reaching as far back as 20 years. 2) Make sure to plan ahead with your finances so you don’t fall short when deadlines arrive. 3) Be conscious of when the deadlines are arriving and what state your finances are in. It’s important that you know how much tax you’re due to pay as this helps you to plan your finances around how much is due. HMRC offer a ‘Budget payment plan’ which allows you to decide how much you wish to pay overtime and also allows you to stop payments for up to 6 months, this option needs to be set up with HMRC for payments through direct debit and when payments are made they need to be regular. If you would rather not use the HMRC’s budget payment plan then you can design your own budget plan which for e.g. could allow you to put money aside for your tax payments, the pro’s for this is that you don’t have the restrictions which HMRC place although they’re not too strict anyway. However the cons are that you need to be self motivated to keep with the budget plan. Alternatively if you prefer to pay in one big lump sum then it’s even more crucial that you’re aware of how much tax you’re due to pay, how far away the deadlines are and your financial state. Overall awareness of the deadlines and you’re own particular financial situation can guide you to making a budgeting plan for tax returns. It’s also worth bearing in mind that just a bit of planning ahead can save you from unnecessary fines and penalties from HMRC. By Mohammad Khan at Tax Affinity Accountants. Chancellor Autumn Budget 2014 and how it effects people
It was announced that the UK has the fastest growth in the G7 and the deficit is also expected to fall by half by the end of 2014-15. Fuel duty has also been frozen till the end of current parliament in May 2015. Stamp Duty: First to be affected by the 2014 Autumn will be UK home buyers. The main change is that the Stamp duty has been changed as of Midnight 3rd December 2014. This is suppose to affect 98% of homeowners in England and Wales. This change will be beneficial to those purchasing a house for £937,000 or less but for anyone paying more than that amount they are likely to pay more in stamp duty. The problem with the previous system was that the boundaries between the stamp duty were very sharp e.g. if someone was to buy a home for £250,000 they would have to pay 1% tax duty which would be £2500 but if the prices was to be even 1p more than the £250,000 cap then you would fall into the 3% tax bracket for houses with a price of over £250,000 and you would need to pay £7500. The new system allows for someone to pay 0% to stamp duty for the first £125,000 so for example someone who buys a house for £200,000; they will only pay 2% stamp duty on £75,000 remaining, meaning they would pay £1500 instead of the £2000 they would have had to have paid on the previous system. Although the rates have increased in percentage in the higher price cases, the overall charge will still be mostly lower for those paying less than £937,000 on a property. The new system has aimed to smooth out the drastic jumps in the boundaries placed on the stamp duty rates and statistically if buying a home in England or Wales the average person will pay £4500 less in stamp duty. Also for any individual that have exchanged the contracts but it has not been completed, they are allowed to choose which out of the two systems they would like to use. The old rates:
The new rates:
Savings: The limit for tax free ISA accounts paid in cash/shares is going to increase to £15,240 in April from £15,000 that was announced last July. Previously in the situation of a deceased individual who owns a cash ISA account the spouse of the individual will lose the tax free status of the account when they start paying the tax. However the chancellor has said that with immediate effect the spouse of the deceased will be able to inherit and keep the tax free status of the account. Overall the news on pensions is good as the government has decided to scrap the pension death tax. This means that individuals will be able to pass on their annuity income tax - free when they die before the age of 75. This is a significant change to the previous legislation as there used to be a charge of 55% when annuity retirement income was passed on and this also means that there is much more room to manoeuvre when people pass on their pension wealth. People will also be allowed to access their pensions as they require from retirement which allows them to not need to arrange an annuity. Tax free Allowance: The maximum amount you earn before you are required to pay income tax will be increased to £10,600 from £10,000 in April 2015. Business rates: The high street discount for roughly 300,000 shops, cafes, restaurants and pubs is set to increase in April 2015 to March 2016 by £500 from £1000 to £1500, helping to improve and promote growth amongst the nation's small businesses and local communities. Small business rate relief has also been doubled for another year which means that 380,000 of the smallest business will pay no rates at all and there has also been stop to 2% of the increase in business rates from April 2015 - March 2016. NIC'S (National Insurance Contribution): The government is trying to make it cheaper to employ young people from April 2016 by allowing employers to not have to pay NIC's for all apart from the highest earning apprentices. This is a bid to improve the chance of the UK having the highest employment rate in the G9. Tax on economy flights: Flights from the 1st May 2016 for under 12s will be exempt from tax and also for under 16s from the 1st March 2016. NHS (National Health Service): £2 billion extra funding has been allocated to the NHS for 2015-16.
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