Most of us know we should be saving more for retirement and the government knows that we need to save more too. That’s why they give pensions tax breaks and employers are being forced to auto enrole staff into pension schemes and make payments.
But how many of us stand a chance of saving £400k into our pensions? it’s a huge amount of money and yet it only buys a modest pension.
And it doesn’t sound like you can rely a on state pension or credit either, article below from Investors Chronicle…
A pensioner couple needs a weekly budget of £231 to meet a minimum income standard (£12,000 a year) that allows them to participate fully in society, according to the Joseph Rowntree Foundation. That £12,000 will enable them to eat out once a month and holiday away from home once a year on a half-board coach-tour package.
This may seem quite a modest amount. In fact, the income level guaranteed for pensioners by Pension Credit in 2012 is just over what is needed to meet the minimum income standard, and the proposed universal pension will be more. But don’t let that lull you into complacency.
The universal pension is just a proposal at the moment, and if you have investments, you are unlikely to qualify for the current Pension Credit, meaning £12,000 becomes a significant ball-park figure on which to base your investment plans.
Breakdown of minimum income standard for pensioner couple
||£ per week
|Other housing costs
|Personal goods and services
|Other travel costs
|Social and cultural participation
Source: Joseph Rowntree Foundation, July 2012
This Monday (18th July), the BBC’s CFO, Zarin Patel and its head of employment tax, David Smith, were quizzed about the use of personal service companies (PSC’s) within the corporation by the Commons Public Accounts Committee. It emerged that out of the Beeb’s 467 presenters, 148 broadcasters, i.e. nearly a third, were being paid via PSC’s. These 148 are not unique, however, as the BBC engages 25,000 freelancers.
This has been under discussion for a while and back in 2010 Accountingweb reported
Amongst those appearing as freelancers are: Jeremy Paxman (earning about £1m a year); Fiona Bruce (with annual earnings of around £500,000); and Fearne Cotton (who rakes in around £200,000 per annum)*.
However, not all presenters have fled the broadcaster’s payroll, with the likes of Huw Edwards (Ten O’Clock News presenter); Nick Robinson (political editor) and Evan Davis (presenter of the Today programme) still prepared to suffer good old fashioned PAYE.
It is hard to see on the face of it why a TV presenter would not be an employee based on:
- Personal Service/Subsititution
- Mutuality of Obligation
- Financial Risk
A BBC spokesman stated that the corporation provides HMRC with a detailed annual report of all payments made to PSC’s.
In response HMRC has now announced that it will increase its investigations into PSC’s. After admitting that HMRC had only enquired into 23 PSC’s, the department’s chief, Lin Homer, vowed to increase such investigations ‘ten-fold’ over the next year.
Miss Quashie, who has a daughter, began work as a stripper at Stringfellows in June 2007. She earned thousands of pounds to provide for her child.
But she was dismissed from the Central London nightspot in December 2008 following allegations of drug use, which were changed to an allegation of dealing after she took a test. She denied both allegations.
Read more: http://www.dailymail.co.uk/news/article-1319609/Face-lapdancer-used-womens-rights-campaigner-suing-sacking.html#ixzz20aX6oMIj
At Tribunal the the judge ruled she was an employee, but now the contract could be rendered illegal because of Miss Q’s dealings with HMRC.
Stringfellows argue that even if Miss Q was employed she acted illegally by representing to HMRC that she was self employed.
A key point in the case now is that ‘ any illegal act by a worker in the context of the job they do for you might invalidate the contract’ this could include misleading HMRC. [Indicator Tips&Advice Tax 28-06-12]
Employment status is complicated area that seems to continue to become more complicated.
Well over 95% of limited companies in the UK are “private” – it is by far the most common form of limited company.
The main advantages of a being public limited company are:
- Better access to capital – i.e. raising share capital from existing and new investors
- Liquidity – shareholders are able to buy and sell their shares (if they are quoted on a stock exchange)
- Value of shares – the value of the firm is shown by the market capitalisation (based on the share price)
- The opportunity to more easily make acquisitions – e.g. by offering shares to the shareholders of the target firm
- To give a company a more prestigious profile
As always there are some disadvantages to being a PLC (as opposed to remaining as a private company). The main downsides are:
- Once listed on a stock exchange, the company is likely to have a much larger number of external shareholders, to whom company directors will be accountable
- Financial markets will govern the value of the company through the trading of the company’s shares, and will represent the market’s view of the company’s performance over time
- Greater public scrutiny of the company’s financial performance and actions
These are the main differences in summary:
- You must use the description ‘PLC’
- A public company must have issued share capital to a nominal value of £50,000 of which 25% must be paid up.
- Only public companies can offer their shares to the public
- There are strict rules that shares must be issued for full value
- PLCs must file their accounts within 6 months from their year ends
- PLCs must have two directors
- PLCs must have a suitably qualified company secretary
- PLCs must hold AGMs when the accounts can be received
- PLCs cannot approve written resolutions unless authorised by the articles
- There are strict regulations on PLCs purchasing or providing financial assistance to purchase their own shares
- Traded PLCs cannot place restrictions on transfers of its shares. Otherwise such restrictions in the articles are permitted
- Election of directors at general meetings must be in separate resolutions
- PLCs cannot take advantage of the abbreviated accounts regime (but nor can larger Ltd Co’s)
- Listed PLCs can hold shares in treasury (with limits)
- Listed PLCs must have their remuneration report approved at the AGM
- PLC directors can only have authority to issue shares for five years
- A PLC articles cannot exclude pre-emption rights on the issue of new shares
- PLC financial results must use International Accounting Standards if listed but unlisted Plc’s can use UK GAAP
- Nominees of PLC shareholders where the PLC is listed on a regulated market can nominate information rights for the shareholders
- The articles of PLCs must have a specific authority to enable the board to authorise a transaction where the director has a conflict of interest
Small businesses across the UK will soon see HM Revenue & Customs (HMRC) clampdown on corporate away days.
That is according to law firm Pinsent Masons, which said that the department will now ask for tax and National Insurance on the cost of such events.
Joe Quinn, the company’s Director, explained: “If tax inspectors think that there is too much of a fun or social element to a company’s offsite event then they should be treated as though they are a taxable treat for employees.”
Staff Parties and Annual Functions costing less than £150 per head are exempt if open to staff generally but Corporate Hospitality is another minefield
Her Majesty’s Revenue and Customs (HMRC) make it quite clear that members of staff, such as sales representatives, who would be expected to attend corporate hospitality events in order to entertain clients as part of their role within the company, would be exempt from any potential charge on benefits in kind. Other members of staff, who were present purely as a perk of the job, would be deemed as being in receipt of a benefit and therefore would be liable for a charge. Visitors, not employed by the hosting company would be exempt. The company paying for the corporate hospitality would also be able to treat the expenditure as entertaining clients, for which they could claim tax relief.
Pubs, Bars, Restaurants & Night Club operators… It’s a cash business!! And where there’s cash there’s a fiddle, you may think you know them all, you might! But what you don’t have is eyes in the back of your head and the time to watch hours of CCTV footage to catch them at it, and that’s just the tip of the iceberg.
Over pouring, cross ringing, recipe knowledge, wastage, breakages, deliveries, poor GP’s are all areas you need to be on top of if you are to make any profit from your hard earned takings, and given today’s economic climate, knowing how your business is performing and at the very least verifying your in house weekly results via an independent auditor makes sense and could be worth tenfold the monthly cost in potential lost profit.
By choosing an independent stocktaking company who specialise in the licensed trade, you can be certain of finding the answers you need to improve and grow your business effectively.
Stocktaking is essential to all businesses, as it enables you to check that your business is performing to its optimum potential. Stocktaking also highlights any problems with stock losses, for instance theft, and determines whether the pricing and ordering of stock is accurate, allowing you to react and make adjustments to improve your margins or re visit your suppliers costs.
On average 28 Pubs close every week and Net closers are 14 Pubs per week http://fullfact.org/factchecks/pub_closures_alcohol_business-3237
In the current climate stocktaking has to be essential.
Most assets decrease in value over time with usage and should be depreciated over their useful economic life. However, some assets increase in value for example Land & Buildings and some Metal based assets.
Under the revaluation model, revaluations should be carried out regularly, so that the carrying amount of an asset does not differ materially from its fair value at the balance sheet date. [IAS 16.31]
If an item is revalued, the entire class of assets to which that asset belongs should be revalued. [IAS 16.36]
Revalued assets are depreciated in the same way as under the cost model.
If property, plant, and equipment is stated at revalued amounts, certain additional disclosures are required: [IAS 16.77]
- the effective date of the revaluation
- whether an independent valuer was involved
- the methods and significant assumptions used in estimating fair values
- the extent to which fair values were determined directly by reference to observable prices in an active market or recent market transactions on arm’s length terms or were estimated using other valuation techniques
Revaluing Assets will not create a tax charge because:
1. If the asset value increases, the revaluation creates a balance sheet revaluation reserve – Debit Assets, Credit the Revaluation Reserve – in does not create a profit, it increases the Net Worth of the business
2. Revaluing an Asset does not affect Capital Allowances these are based on the Cost of the Asset
3. Revaluing an Asset will not generate a Deferred Tax Charge because although it will affect depreciation, it should be excluded from the Deferred Tax computation as it is excluded from Capital Allowances (IAS 12) – Revaluing the asset increases its carrying value without altering its tax base (since revaluations have no immediate tax consequences)
4. Revaluing an Asset does not create a Capital Gain, Capital Gains will only crystalise if the asset is sold