Contractor Tax Changes and How They Affect You
After all the goings-on of the last six weeks, Budget 2016, which took place in the middle of March, seems a lifetime ago.
Despite this, and despite the fact that then-Chancellor of the Exchequer George Osborne has since been replaced by Philip Hammond at the hands of new Prime Minister Theresa May, all of the tax changes (or upcoming tax changes) for contractors that were underlined by Mr. Osborne at Budget 2016 still hold the same weight as they did before the Brexit vote.
Contractor Tax
For a more detailed look at the ins and outs of Budget 2016, you can read our key takeaways for contractors, companies, and individuals. For now, here are five of the most important contractor tax changes you should be thinking about right now:
Capital Gains Tax (CGT) Reduced to 20%
In a huge boon to tax payers across the income spectrum, from April this year CGT was reduced from 28% to 20% for higher rate tax payers, and from 18% to 10% for basic rate tax payers. This change doesn’t apply to gains made from residential property however, which remains at its former rates.
Travel and Subsistence Tax Relief Scrapped for Some Contractors
With contractors facing the prospect of mandatory IR35 testing from April 2017, Travel and Subsistence tax relief between your home and your working location was scrapped in April for temporary contractors working through intermediaries, such as umbrella companies. Contractors whose work doesn’t fall under IR35 may still claim the relief.
Contractor Class 2 National Insurance Contributions Discontinued
Though the details are still somewhat cloudy, what we do know is that from 2018 Class 2 National Insurance Contributions for contractors will be discontinued, potentially saving contractors making a profit of £5,965 or more per year £2.80 per week. We say potentially because there’s a good chance that some, if not all, of this cost will simply be transferred to your new Class 4 National Insurance Contributions.
£1,000 Allowance for ‘Sharing Economy’ Workers
Touched upon in detail five months ago, with the government having recently recognised that traditional taxation methods don’t work for new-age contractors who are earning small and one-off payments as part of the sharing economy, a new tax-free allowance of £1,000 a year is to be introduced for those earning income through both through trade and property (Airbnb hosts rejoice).
Removal of National Insurance Employment Allowance
In a topsy-turvy turn of events, the withdrawal of the National Insurance Employment Allowance for contractors acting as single-person companies is set to go ahead, while Entrepreneurs’ Relief for multi-owner companies is set to be restored. Entrepreneurs’ Relief will also be offered to external investors in unquoted companies, though the details of this arrangement are still being consulted on.
Experienced Contractor Accountants
To speak with a professional accountant to discuss how these tax changes may affect you as a contractor, or for anything else, contact us today on 020 8780 2349 or get in touch with us via our contact page to arrange a complimentary, no obligation meeting.
Working with an Accountant Specialising in Tech Startups, The Benefits
Technology startups are taking over the world, and here at Tax Agility we believe this can only be a good thing!
The innovation coming out of tech startups, both here in the UK and around the world, is astounding, and it’s only going to continue. We’ve been working with tech startups for several years now, and in that time we’ve been blown away by the quality of operations we have experienced while working alongside some of the smartest minds this country has ever seen.
With this in mind, we believe there are a lot of benefits to working with an accountant specialising in tech startups. Just a small number of these benefits are as follows:
We take time-consuming and complicated accounting work out of your hands
Whether you’re the CEO, CFO, or you hold another role within your tech startup, we’re here to take all the time-consuming and complicated accounting work out of your hands so you can focus on what you do best.
We can’t claim to be as innovative as you, but we are committed to using revolutionary accounting techniques that will help to hold your tech startup up above the rest. We understand the importance of working fast and ‘shipping’ our work; and we’ll be at your beck and call should you have any questions related your financials.
We focus our efforts on helping to maximise your profitability
There are a number of ways in which we can help you to maximise your profitability. As specialists in accounting for tech startups, we find that looking into whether you’re eligible to receive any tax reliefs from the get-go is a great way of achieving an early win that can help to save you money over the long term.
One such relief is the Research and Development (R&D) relief, which is available to all UK startups that are spending money on innovative research in certain industries (primarily science and technology, though there are many overlaps).
We’ve been in this business for decades, and we bring this experience to you
One of the greatest qualities of tech startups is how young they are; you don’t have to unlearn outdated business strategies and can, therefore, forge ahead on your own path, unafraid of the potential pitfalls ahead you.
And that’s where we come in. Here at Tax Agility we have been in business for decades, which means we know exactly what pitfalls you may come up against, even if you don’t know them yet. When you work alongside an experienced accountancy firm such as us, we take the guesswork (or lack, thereof) out of your startup’s future.
Experienced Accountants for Tech Startups
To speak with a professional accountant to discuss our unique accountancy packages for tech startups, contact us today on 020 8780 2349 or get in touch with us via our contact page to arrange a complimentary, no obligation meeting.
The Benefits of Working with an Accountant Specialising in Dentists
The dental industry is constantly changing and evolving. Far from being an old-fashioned institution, dentistry continues to change both internally and externally, with dentists running their own dental practice having more responsibility than ever before.
Here at Tax Agility we know the pressures that are being placed on dentists just like you, and we know just how often these pressures are changing (and often, increasing) as new legislation and other changes come into effect.
For this reason, we think it makes absolute sense for any dentist or dental practice looking to hire an accountant to consider working with an accountancy firm that specialises in the accounts of dentists. Just a small number of these benefits are as follows:
We keep ahead of your changing industry
From new legislative changes to the challenges brought on by private dental competition, here at Tax Agility our specialist accountants make it their priority to keep on top of everything and anything that could affect your practice’s growth and revenue, whether positively or negatively.
This means we’re committed to your growth, and we’ll stop at nothing to ensure that you benefit from (or at least aren’t hurt by) any industry changes that occur. Your success is our success, and our experience working alongside other dental practices gives us the unique ability to help to realise your success, whatever life throws at you.
We take care of all of your accounting and bookkeeping needs
Here at Tax Agility, no task is too big (or small) for our experienced accountants. You can rely on us for all your accounting and bookkeeping needs; we have worked with countless dental industry professionals in the past, including incorporated practices, self employed hygienists, employed dentists, consultants, and specialists (oral surgeons, periodontists, orthodontists, and more).
In the same way that you wouldn’t expect any of your patients to start performing light dentistry work on themselves, we don’t expect you to have to handle any part of your accounts.
We treat you, and your practice, as the individual you are
We make a point to treat all of our clients as individuals, which means we understand that just because you’re a dental practice specialising in a certain target demographic, that doesn’t mean you have the same financial goals as a different dental practice focusing on the same target demographic.
We believe that it’s our job to understand your hopes and desires for your dental practice before we swoop in and start dealing with your books. When we develop this understanding ahead of time it helps us to better serve you both in the beginning and, hopefully, for many years into the future.
Experienced Accountants for Dentists
To speak with a professional accountant to discuss our unique accountancy packages for dentists, contact us today on 020 8780 2349 or get in touch with us via our contact page to arrange a complimentary, no obligation meeting.
The Benefits of Working with an Accountant Specialising in Property Owners
Property owners (both residential and commercial) and estate agents know that there’s an enormous number of different financial areas to consider when buying, selling, or renting out property.
From having to contact HM Revenue and Customs (HMRC) to let them know you’ll be receiving rental income, to knowing what business rates you or your tenants will have to pay when moving into a new commercial property, there’s a lot to keep track of in order to ensure you stay on the right side of the law.
For this reason, there are a lot of benefits to working with an accountant specialising in the accounts of both residential property owners (landlords) and commercial property owners. Just a small number of these benefits are as follows:
We know our stuff
Here at Tax Agility, we have been working with property owners for YEARS/DECADES. For this reason, we know exactly what taxes you need to pay if you just bought a commercial property, or indeed we know exactly how you need to report your rental earnings to HMRC if you have started out renting residential properties for the first time.
Other accountancy firms that don’t specialise in this area will take up your valuable time by having to look these things up, and potentially even miss them altogether, which could be very costly to you.
We keep an eye on tax changes that may affect you
Equally important to knowing our stuff is our willingness to keep an eye on all and every change to the tax codes and legislation that may affect how much you, as a property-owning accountancy client of ours, is liable to pay.
Though it’s rare for a large, overarching tax change to be enforced under the radar, smaller changes can often come up that catch out property owners who are tasked with dealing with their own accounts, or indeed these changes can even catch out accountants who are not well versed in the complexities of property ownership taxes.
We provide a full-service accountancy experience
Here at Tax Agility, we provide a full-service accountancy experience to all of our property owner (both residential and commercial) and estate agent clients.
We understand the problematic tax implications of owning, buying, or renting property, and we take it upon ourselves to ensure you only pay the tax liabilities owed to you, nothing more, while keeping your books up to date and in line with the law. No property owner can operate without having their books in order - we make sure you’re always operating both legally and efficiently.
Experienced Accountants for Property Owners
To speak with a professional accountant to discuss our unique accountancy packages for residential (landlords) and commercial property owners, contact us today on 020 8780 2349 or get in touch with us via our contact page to arrange a complimentary, no obligation meeting.
The Benefits of Working with an Accountant Specialising in Hospitality
If you’re an owner or manager of a business operating in the hospitality industry (you operate a hotel or restaurant), you’ve probably heard all of this before.
Running a hotel or restaurant is no easy task. The trials and tribulations of running a successful hospitality business are frequent and numerous, and that’s before you even consider the notion of trying to forge a profit.
Given this point, and the always-on environment of working in the hotel or restaurant industry, it’s clear to see that there are numerous benefits to working with an accountant specialising in the accounts of hoteliers and restaurateurs. Just a small number of these benefits are as follows:
We help define (and work with) your financial goals
Often the task of simply running your hotel or restaurant is so time-consuming that it’s hard to think of where the time to sit down and define your financial goals would come from.
Despite this, we think it’s essential for all of our hospitality clients to define their financial goals with us before we start working with them, so we can create a clear picture of your wants and needs, and we can therefore serve you better going forward. We can help you find areas in which you can save money, increase profit, and even help you to leverage your assets.
We help you focus on what you do best
You have a million and one things to do. For this reason, when you work with one of our specialist hospitality accountants here at Tax Agility we help you focus on what you do best: running your hotel or restaurant.
Because we’re specialists in this industry you don’t need to spent your time teaching us the small intricacies of a hotel or restaurant’s accounts. We’ve been there, done that, with a large number of current and former hospitality clients, therefore all you need to do is provide us with the accounts we ask for, and we can immediately get to work.
We’re at your beck and call
Most accounting firms try to maximise their profits by working with as many clients as possible. The problem with this approach is they quickly lose the personal touch, losing touch with their clients unless it’s time for you to file your annual tax return or you make the effort to go to visit them personally.
Here at Tax Agility, all of our hospitality clients are at our beck and call. If you have a question about your accounts, or even just a new piece of government legislation, get in touch and we’ll answer your question right away. Our close relationship with our clients not only helps you get your questions answered faster - it helps us to better understand you and your business.
Experienced Accountants for Hospitality Professionals
To speak with a professional accountant to discuss our unique accountancy packages for hospitality professionals, contact us today on 020 8780 2349 or get in touch with us via our contact page to arrange a complimentary, no obligation meeting.
The Benefits of Working with an Accountant Specialising in Doctors and Healthcare
Would you call up a surgeon when your child gets a nasty cold? Or indeed, would you expect your child’s paediatrician to be able to operate on you at the drop of a hat?
The answer to both of those questions (we hope!) is a solid no, which is why here at Tax Agility we think it’s so important that as a doctor or healthcare professional your accounts are being taken care of by a professional accountancy firm that has a long history of working with other doctors and individuals working within the healthcare industry.
There are a huge number of benefits to working with an accountant specialising in the accounts of doctors and other healthcare professionals. Just a small number of these benefits are as follows:
We have a clearer understanding of your unique needs
Here at Tax Ability we have worked with (and in many cases, are currently working with) a wide range of individuals working in the healthcare sector, including audiologists, dermatologists, family practitioners, gynaecologists, orthopedists, surgeons, and more.
Working closely with other healthcare professionals has helped us to develop a much clearer understanding of your unique needs than we ever could have gained if we hadn’t chosen to specialise in this area, whether in terms of the comprehensive understanding we now have of the preferred accounting practices in your industry, or the insight we have gained regarding how best utilise these practices.
We keep an eye on legislation changes that are specific to you
As professional tax accountants it’s our job to keep our fingers to the pulse (so to speak) with regard to any new legislation that comes out that may affect our clients. When you work with an accountant with a large number of clients already in the healthcare sector, you know we’re going out of our way to keep you updated about any legislative changes that may impact you specifically.
If new legislation comes into play that will help (or hinder) your tax saving plans, you’ll be the first to hear about it, alongside a list of our suggestions on how to move forward.
We take a long-term approach to working alongside you
Here at Tax Agility we take a long-term approach to working alongside all of our clients. Whether you’re working through an agency, an umbrella company, or your own limited company, we want you to be a long-term client of ours, and we do this by offering you exceptional service at every turn.
Though we love working alongside doctors and other healthcare professionals, we want to take up as little of your time every month as we can. We keep your financial accounts up-to-date and accurate so to ensure you can focus on your job, while we focus on ours.
Experienced Accountants for Doctors and Healthcare Professionals
To speak with a professional accountant to discuss our unique accountancy packages for doctors and other healthcare professionals, contact us today on 020 8780 2349 or get in touch with us via our contact page to arrange a complimentary, no obligation meeting.
The Benefits of Working with an Accountant Specialising in Solicitors
There’s a common, misguided believe among people who are otherwise unaware that solicitors and lawyers should have a hand in all forms of money management, both when it comes to the finances of their clients and their own personal wealth and tax allowances.
This is simply not the case. Though it’s indeed true that many solicitors and lawyers could see to their own accounts should they so wish, it’s generally agreed that this is not a good use of your precious (and let’s be honest, expensive) time.
There are a wide-ranging number of benefits to working with an accountant specialising in the accounts of solicitors and lawyers. Just a small number of these benefits are as follows:
We can help you choose an appropriate business structure
If you’ve not yet done so, our professional accountants here at Tax Agility can help you choose an appropriate business structure if you’re currently an independent solicitors or law firm.
From working with many solicitors and law firms over the years we have identified which business structures are more appropriate for which types of solicitors and law firms (depending on your size, ambitions, and more). This can include alternative business structures, if operating your business in an alternative manner will allow you to stand out from your competition.
We will become your full-service accountancy firm
You have a lot on your plate. We mean, you really have a lot on your plate (more than our resident accountants during a typical Christmas dinner). For this reason, we’ve found that our solicitor and lawyer clients appreciate our full-service approach to working for you.
Here at Tax Agility, we provide a full suite of accounting, bookkeeping, and tax services to solicitors and lawyers in order to help take the guesswork out of your accounts. We know you work in a stress-filled environment; our job is to remove the stress of your accounts out of the equation.
We’re here to help you grow, while avoiding growing pains
Here at Tax Agility, we recognise that the legal sector is changing very quickly, which can be tricky at a time when law firms are trying to become more innovative with their pricing.
Growing your solicitors or legal practice comes with a lot of baggage. We’re here to help. We’ve worked alongside (and continue to work alongside) numerous solicitors as they attempt to grow their business over time, and from that we’ve learned how complex such an operation can be. Here at Tax Agility we talk all of our solicitor and law firm clients through the most effective growth strategies for them, keeping in mind tax reduction and ease-of-growth, in order to help grow their business the right way.
Experienced Accountants for Solicitors
To speak with a professional accountant to discuss our unique accountancy packages for solicitors and lawyers, contact us today on 020 8780 2349 or get in touch with us via our contact page to arrange a complimentary, no obligation meeting.
How Would Brexit Affect Your SME
If you’re a small or medium-sized business (SME) owner who currently exports to Europe, whether business-to-business or business-to-consumer, the upcoming European Union (EU) referendum on 23 June may hold a significant weight on your business’s future earnings.
Because the EU operates as a single market with no tariffs imposed on imports and exports between member nations, small businesses exporting from the UK to other EU member states have had it pretty good up until this point; but that could all change should the ‘leave’ camp gain more than 50 percent of the vote at the end of June.
If you currently export to Europe, here are five things to think about regardless of the potential Brexit:
1. There’s a ‘Wealth’ of Potential
It’s no exaggeration to say that some of the wealthiest counties in the world reside within Europe (and, for the most part, are EU member states). High wealth means high consumer spending, and if you’re not tapping into this spending you could be leaving money on what is currently a very reachable table.
2. Does Exporting to Europe Significantly Add to Your Bottom Line?
With that said, you have to ask yourself if exporting to Europe will significantly add to your bottom line, especially if you have high marketing and advertising costs (see below). You can argue that making a smaller profit in Europe is worth it for a short period to gain brand recognition, but if this doesn’t soon pick up you may want to rethink your decision to sell abroad.
3. You’re Geographically Close
Regardless of whether or not Britain is still in the EU after 23 June, we’re still very close to the continent geographically, which means Europe will continue to be a cheap (compared to the rest of the world) location to export to.
4. You Have to Keep Foreign Taxes in Mind
Exporting to Europe means you not only have to pay taxes in the UK but, depending on what you’re selling and how much, there’s a good chance you also have to pay tax in the countries you’re exporting to. These will change should the ‘leave’ camp succeed, but this is a complicated topic nonetheless.
5. Exporting to Europe Helps to Solidify Britain's Place in the World
Not that this should rest on your shoulders alone, but choosing to export to Europe helps to solidify Britain's place (and importance) in the greater world. It also, depending on what you’re exporting, allows the rest of the world to benefit from the exceptional talent and creativity within Britain’s shores.
Experienced EU Tax Accountants
To speak with a professional accountant to discuss the positives and negatives of exporting to Europe, both now and in the future, contact us today on 020 8780 2349 or get in touch with us via our contact page to arrange a complimentary, no obligation meeting.
Brexit: Opinions on the Impact on SMEs
There’s no doubt that you’ve read hundreds of articles and opinion pieces on Brexit and the European Union (EU) referendum over the last few months. For this reason, we’re going to keep this brief.
This is our roundup of varying (and often wildly different) opinions on the potential impact of Brexit on small and medium-sized businesses (SMEs) across the country. If, like 42 percent of small business owners surveyed earlier in the year, you are still on the fence over whether to vote for a British exit from the EU or not, this neutral roundup may help to sway you one way or another.
Remain: Free Movement of Individuals
Though this is a topic of debate that has primarily come up regarding us Brits’ ability to move around Europe (or rather, let’s be honest, the Mediterranean coast) on our holidays with the same ease we enjoy now, research published by the Federation of Small Businesses (FSB) suggested that 70 percent of SME owners said the continued free movement of individuals, and thus, labour, across Europe would influence how they vote come 23 June.
The key here is talent, and it’s a contentious issue among voters. From a small business’s point of view it makes sense to wish to hire the most qualified person for the job, as long as they’re able to legally work in the UK. Voters, on the other hand, argue that British citizens should have precedent in the job market over non-British members of the EU.
Leave: Flexibility and Adaptability
Back in March, and in response to a letter published the week before by the heads of 36 FTSE 100 companies urging Britons to remain in the EU, 200 small business owners signed an open letter urging the British people to ignore “…a minority of managers from Britain's largest companies,” and instead support Britain’s small businesses with a ‘leave’ vote on 23 June.
The emphasis of the letter gave a strong focus to the ideas of flexibility and adaptability; something the signatories of the letter said EU membership hinders, namely commenting that “…we deal with the EU's constant diet of unnecessary regulations which add to our cost base, reduce our bottom line, and raise prices for our customers for no return.”
Remain: Better Trading Channels with Europe
This point has been argued so much it barely bares repeating. But we will because, well, it’s one of the biggest inflection points for SME owners who export to the rest of Europe.
Unsurprisingly, the ‘remain’ campaign has gained almost unanimous support from large companies who do business with Europe on a daily basis. Equally unsurprising is the fact that small businesses who also happen to do business with Europe have also been piping up in favour of a ‘remain’ vote, as despite assurances on both side, it’s hard to predict what trade relations with the rest of Europe will look like post-Brexit.
Leave: Cost of Membership is Too High
The often-cited figure that you see splashed across our television screens (not to mention busses) is that the UK sends £350 million per week to the EU. Though this figure has come up against scrutiny (it’s said that a rebate is deducted before payment, making the actual figure around £280 million per week), it’s difficult for anyone on either side of the equation to argue that that’s not a significant sum.
Though the cost of membership isn’t as big a deterrent to staying in the EU for small business owners than it is to the general public, it’s still a point of contention, with 69 percent of SME owners saying that the high cost of EU membership will affect their vote, according to the FSB.
Experienced Tax Accountants
To speak with a professional accountant to discuss the potential impacts, positive or negative, the results of the EU referendum may have on your small business, contact us today on 020 8780 2349 or get in touch with us via our contact page to arrange a complimentary, no obligation meeting.
Preparing SME Accounts for Your Accountant
If you’re a small or medium-sized business (SME) owner looking to prepare your accounts for an accountant, there are a number of things you can do to ensure our experienced accountants here at Tax Agility can work through them faster and you don’t lose out on anything you may be owed.
Before we move on to the main points below, we can’t overstate enough the importance of you keeping good, user-friendly records. If you’re unsure of exactly what this means for your SME, ask your accountant how they would like your records to look when you hand them over to them.
Needless to say, the better you prepare your SME accounts for your accountant, the less time they will need to go through them, and the lower your bill. This starts with keeping good records.
Communication
Good communication is essential when preparing your accounts, as without it both you and your accountant can find yourselves going around in circles.
Though good communication is important throughout your relationship with your accountant, it’s especially necessary should there be any changes in your business which, you believe, may affect our work. Typical changes of this nature include changes in your product or market (what you’re selling, and who you’re selling to), your bookkeeping system/software, your key employees, and your overarching business approach.
Part of the communication process requires us to jointly agree on a timetable for our accounting processes to tale place. This timetable can be flexible, but it’s good to have it arranged in advance.
Keeping Your Books Organised
There’s nothing that will help your accountant work through your accounts faster than ensuring that your books are kept organised and maintained. And this isn’t just a useful practise for your accountant: keeping your books organised makes it easier for you to see the current state of your business, and understand why that is.
There are many ways to keep your books organised depending on your type of business, but in general we always recommend that the SME’s we work with do the following:
- Balance your books on the regular - this allows you to notice any mistakes (and correct them) sooner rather than later,
- File your invoices in a standard order, such as numerical or by date - doing so will make finding a particular invoice much easier,
- Consistently analyse the payments you receive, and the receipts for these payments, so this information is readily on hand.
Maintaining Good Procedures
Ahead of preparing your SME accounts for your accountant it’s good practise to maintain good procedures so you know what’s going on within your business at all times.
One procedure you’ll wish to perform on a regular basis is reconciling your records to ensure they’re accurate, with your bank accounts, control accounts, and statements from your suppliers all requiring a look-over. If your SME holds physical stock it will need to be counted every twelve months. This can be done by yourself or independently, however if you hold a particularly large amount of stock you may wish for us to undertake our own count.
Part of maintaining good procedures ensures that you produce the relevant schedules to assist in the preparation of your accounts. These schedules include a list containing your debtors at year end (how much they owe, the likelihood of it being paid), additions and disposals of your fixed assets, bank and cash balances at year end, and creditors at year end.
We understand that keeping on top your accounts and practising recquires a decent knowledge of the tax implications involved in certain transactions. For that reason, we have a range of online calculators to help you along the way.
Experienced SME Accountants
To speak with a professional accountant to discuss how to prepare your SME’s accounts, with advice unique to your business, contact us today on 020 8780 2349 or get in touch with us via our contact page to arrange a complimentary, no obligation meeting. In the meantime, feel free to take a look at our services page to get a more indepth look at what we have to offer.