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Category Archives: Bicknell Business Adviser
Its a new blogging record! we have beaten 2016 Reply
Now HMRC are stopping Post Office tax payments! Reply
On the 15th December 2017 you will no longer be able to pay tax at any Post Office Branch, fantastic timing! just in time for the January self assessment payment rush
The contract with Santander which allowed this method of payment expires on that date and Santander and HMRC have not reached agreement on a new contract.
To make things worse from the 13th January 2018 you won’t be able to pay by Credit Card either!
So your options will be
- Debit card
- Online Banking
- Cheque in the Post
- Direct Debit
These changes are likely to come as shock to many taxpayers and any reduction in ways to pay can only be bad news for taxpayers!
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If a company owns CryptoCurrency how are gains taxed? Reply
In a company Capital Gains and Trading activity are both taxed at Corporation Tax Rates.
The downside to holding CryptoCurrency as an investment is that if you have a trading company it could put your trading status at risk for entrepreneurs relief if more that 20% of the business becomes investment related.
The best known Virtual Currency is Bitcoin and since 2014 there have been calls for tighter control of these currencies.
The European Banking Authority, the EBA, called on national supervisory authorities to discourage banks and credit institutions from buying, holding or selling virtual currencies. It called for regulation of market participants at the interface between conventional and virtual currencies. Over the longer-term, the EBA is calling for a ‘substantial body’ of regulation to be applied to virtual currency market participants, including the creation of ‘scheme governing authorities’ accountable for the integrity of a virtual currency scheme and the imposition of capital requirements. In the short term, the EBA is calling for national authorities to ‘shield regulated financial services from virtual currencies’.
Bitcoin uses peer-to-peer technology to operate with no central authority or banks; managing transactions and the issuing of bitcoins is carried out collectively by the network. Bitcoin is open-source; its design is public, nobody owns or controls Bitcoin and everyone can take part.
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Does a Company pay tax if it receives a Dividend? Reply
We generally recommend creating a holding company to hold property investing companies as it helps to centralise management and can give guarantees to lenders.
Many business owners have a concern that if the holding company receives dividends from subsidiaries that they will be double taxed, once in the subsidiary (before paying dividends) and then on the profit in the holding company when in receives the investment income (dividends). This would be madness!
Dividends paid to UK Holding Companies are normally exempt from Corporation Tax.
https://www.gov.uk/hmrc-internal-manuals/company-taxation-manual/ctm15150
A distribution made by a UK resident company and received by a UK resident company is generally not included in the recipient company’s CT profits. Similarly, such a distribution received by a non-UK resident company trading through a UK permanent establishment is not generally included in the CT profits of that permanent establishment. However, the way in which distributions received by companies are treated for tax purposes changed from 1 July 2009:
- Until 1 July 2009, ICTA88/S208 (and for a brief period CTA09/S1285) provided that corporation tax was not chargeable on distributions from UK resident companies.
- From 1 July 2009, the way in which distributions from UK resident companies are taxed was aligned with the treatment of distributions from non-UK companies in CTA09/S931A. (Previously, distributions from non-UK resident companies were charged to corporation tax as income from foreign possessions under ICTA88/S18, that is, under Case V of Schedule D). CTA09/S931A charges distributions from UK and non-UK resident companies to corporation tax, but then exempts these from charge in most cases. In practice, this means that most distributions – UK and non-UK sourced – are not chargeable to corporation tax unless these form part of avoidance arrangements.
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HMRC forced to decline Credit Card Payments 2
If you thought you were going to pay your tax bill with a personal credit card in January 2018, then think again!
EU rules are forcing HMRC to change their policy in January.
https://www.gov.uk/pay-tax-debit-credit-card
You won’t be able to pay with a personal credit card from 13 January 2018.
This change was instigated by the Second Payment Services Directive (PSD2), which outlined that there could be no onward charging consumers for credit or debit cards. This includes HMRC who have said that they cannot absorb the costs of the merchant providers for credit card facilities and therefore no payments will be taken by credit card. Debit cards payments will still be possible, as the underlying costs are not as high.
This is happening at the peak of self assessment time! so it will be a nightmare for tax payers
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The Director who made his company insolvent by taking a Bonus! Reply
Kenneth Moyes has been disqualified for five years from acting as a director after he withdrew cash from his football company to avoid tax payments.
https://www.gov.uk/government/news/pre-season-tours-no-longer-friendly-for-banned-director
Moyes’ disqualification follows an investigation by the Insolvency Service into Glasgow-based Professional Pre Season Tours Limited, which ceased trading in April 2014.
The company had been involved in arranging pre-season tours for various football clubs, including Everton, Chelsea, Liverpool, Leeds United, Sheffield Wednesday, Nottingham Forest, Norwich City, Aberdeen, Hibernian and Celtic.
The investigation found that Moyes transferred over £300,000 from the company to himself as a ‘bonus payment’ shortly before the company stopped trading. However according to the company accounts, no money was actually transferred, although it allowed him to claim a loan account debt was settled. In reality, this money had already been withdrawn for his personal use.
Investigators established that he withdrew at least £420,400 in cash from the company while it was trading, but failed to declare the full amount.
Because the fictitious transfer resulted in a nominal asset of the company being turned into a liability, it was unable to pay its obligations to HM Revenue and Customs (HMRC) in terms of PAYE and National Insurance contributions. At liquidation it owed £271,180 to creditors, of which all but £4,067 of which was to HMRC.
We all need to pay tax, those who seek to find ways round the system need to know that HMRC will find them and make them pay!
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Do you really need a car or van? why not join a club? Reply
Car and Van club vehicles can be booked by members for any length of time from 30 minutes, with the flexibility to increase the booking period to anything from an hour up to a whole weekend, or longer by arrangement.
- Book online, by app or by phone
- Drive for as long as you’ve booked it for (increasing if you need to)
- Pay direct from your account (based on hours used and mileage)
Zipvan is popular for Vans and cars, it works
Obviously at the moment some locations don’t operate Car and Van Clubs but could this be the future for vehicle usage?
It will save you having to buy or lease a vehicle and pay for insurance and maintenance.
You will need to work out a cost analysis to compare options.
What are your current costs?
What are the vehicle club costs?
Does it save money and give you greater flexibility?
According to Transport for London
What are the benefits?
- Convenient car use
The convenience of a car without the hassle of owning one – no more servicing, insurance, parking, MOT, repairs - Self-service
Cars are accessible to members at all hours - Saves you money
According to Carplus, joining a car club could save you £3,500 per year compared to owning a car (if you currently drive fewer than 6,000 miles per year) - Protect the environment
Car club vehicles are energy efficient and cleaner than the average car. They also reduce the need to own a car and discourage unnecessary car travel. Some car clubs offer electric vehicles (EVs) which emit neither harmful CO2 nor air pollutants from the tailpipe
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Will the Small Business Commissioner help your business? Reply
At the start of October the Government announced
The appointment of the father-of-three from Birmingham marks an important step toward ensuring small businesses have the support they need to thrive and grow – a central tenet of the Government’s Industrial Strategy.
As Commissioner, Mr Uppal will lead an independent office tasked with empowering small businesses. The role will be crucial to supporting small businesses resolve disputes with larger businesses and will help drive a culture change in payment practices.
Mr Uppal and his team will provide general advice and information to small businesses on matters such as resolving disputes, including signposting small businesses to existing support and dispute resolution services, which will be delivered through the commissioner’s website. His priorities will reflect his 20-year experience as a small business owner in the real estate sector, where he saw how even sound businesses could struggle when faced with a culture of late payment by customers.
Mr Uppal said:
“Running your own business can be a very lonely experience and my priority will be ensuring small firms feel supported as well as helping to create an overall impression that business isn’t necessarily cut throat.
“In fact, successful businesses are built on integrity, entrepreneurial spirit and trusting relationships and I want to highlight that Britain can be the best place in the world for new entrepreneurs to establish and grow their own businesses.”
Many small business are overwhelmed by red tape and paperwork, worried about the economic climate and brexit and need support, will the new commissioner come to their rescue?
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We have automated book keeping with Receipt Bank 1
We have become Receipt Bank Partners which means we now have a practice licence and can use receipt bank for any client that allows us to.
Most software now allows you to capture and save receipts but receipt bank actually reads the receipt so there is less data entry required.
It has preset rules for specific suppliers so it knows where you would like things posted.
When it sends information to Sage or Xero (or other programs) it attaches the invoice or receipt.
We think this a major leap forward in the automation of book keeping.
