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We are delighted to announce the promotion of Moiz Ebrahim from Senior Client Portfolio Manager to Director. As the latest member of the Board, Moiz joins Chris Howe, Paul Bithrey, Stephen Mason, Darren Fletcher, and Tara Aldwin as the sixth director, giving an excellent framework to support future growth at our Luton office.
Moiz will be known to many of you from his five years as a key member of our senior management team. He began his career in a firm similar to Foxley Kingham where he qualified as a Chartered Accountant before a spell in a mid-tier firm, and joining Foxley Kingham as a Senior Client Portfolio Manager in 2009. His dedication and hard work during this time, as well as his personable nature have made him a natural choice to increase capacity at Director level. In addition to providing a full range of accounts and tax services, Moiz specialises in audit, professional practices and the charitable sector.
Some things you may not already know about Moiz are that his great loves in life are his family and food! Moiz credits the former as his greatest achievement, and the latter unfortunately as his greatest weakness and hence the reason for a regular battle with exercise.
Stephen Mason said “Moiz is an exceptionally talented and hard-working member of our team and I am thrilled we were in a position to make him an offer at this time.
The promotion is extremely well-deserved and I have no doubt that Moiz’s contribution at Board level will be invaluable in driving the business forward. This latest move is a measure not only of our confidence in Moiz personally, but in our ability to move Foxley Kingham forward over the coming years.”
NEW DIRECTOR APPOINTMENTFOR FOXLEY KINGHAM IN
SID
E
Congratulations all round for Directors Moiz Ebrahim and Stephen Mason
See Moiz’s profile on the website at:www.fkca.co.uk/about-us/director-profiles
THE LATEST DEVELOPMENTS IN ACCOUNTING AND COMMERCE AND WHAT THEY MEAN TO YOUR BUSINESS
HMRC Enquiries – How To Reduce Your Risk • Calculating Holiday PayAutumn Statement 2014 • Innovation Vouchers • Cloud Accounting ... and much more
INS
IDE
Foxley KinghamIssue 29 Winter 2014-15Issue 29 Winter 2014-15
HMRC ENQUIRIES – HOW TO REDUCE YOUR RISK
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Since 2007, HMRC campaigns have collected over £989 million in tax. A number of criminal investigations are underway and eight people have been convicted, with custodial sentences totaling in excess of 10 years handed down and leading to the recovery of £593,000.
CURRENT HMRC CAMPAIGNS
• The Solicitors Tax Campaign was announced 8th December 2014 and runs until 9th March 2015,
giving solicitors the chance to declare previously undeclared income.
• The Credit Card Sales Campaign is for individuals or businesses that accept credit or debit card payments and haven’t declared all income to, or registered with HMRC.
• The Second Incomes Campaign gives those employed but with additional untaxed income a
An enquiry from HMRC is never a pleasant experience – even if everything is found to be in order the time, expense and disruption to your business, not to mention the worry, is not welcome. In the first of series of articles on how to handle HMRC’s enquiries, we explore how to reduce your risk of enquiry in the first place.
Selection procedures these days mean there are very few random enquiries (under 1%). HMRC spend an awful lot of time and effort on information gathering, which is used to grade people or businesses for enquiry selection on a risk basis, in order to maximise their return.
So, how can you reduce this risk?There are many factors within your control;all of the following will raise your risk,so take simple measures to avoid these:
• Late returns
• Amending returns
• Estimating returns
• Round sums
• Failure to pay taxes
• Mishandled calls or visits
• Failure to respond to requests
In addition HMRC monitor the following for evidence of increased risk:
• Non arms-length transactions (i.e. not at market value)
• 3rd party information
• Internet searches
• Statistics
• Informants
What information sources do HMRC use to gather information?
• Banks
• Property websites
• Letting / estate agents
• Land registry
• Credit agencies
• Databases
• Electoral Role
• Insurance providers
• Observation
All of this information is gathered in a central HMRC database and used to score businesses by order of risk. So in the first instance, use a good accountant (such as ourselves!) and get all of your records in early in order to ensure that that returns are complete and in on time. If you are not sure if something is relevant – ask! Pay your tax on time, and it sounds obvious, but be nice to Inspectors in telephone calls or visits – they remember!
If you do receive any HMRC enquiry notice, tell us as soon as possible, and don’t forget our Tax Investigation service could prove invaluable in the event of an enquiry. Cover is October - September, but it is not too late to obtain cover, which starts from just £55 inclusive of VAT for personal tax returns.
THE RESULTS OF HMRC CAMPAIGNS
Invaluable protection for you and your business from as little as £55!
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Take a few minutes to consider what impact a tax investigation would have on you and your business.
On average an investigation lasts 19 months – that’s 19 months of stress dealing with unpleasant questions, reams of correspondence and meetings with an Inspector. If you are in business, that is time diverted from what you should be doing.
It typically costs more that £5,000 in professional fees to defend an Inspection.
In order to achieve its target of £24.5billion of additional tax yield, HM Revenue & Customs (HMRC) has brought together operational research officers, data specialists and frontline tax experts to form a results driven team to deliver compliance results. 5,463 HMRC staff have been moved into new and different roles to help bring in the extra revenue.
CONNECT is HMRC’s data system which trawls through over one billion records relating to property transactions, tax return information, loans, bank account details and employment data to identify potential investigation targets.
More than £600 million has been delivered from targeted campaign activity into professions and trades. Further campaigns and taskforces are to be announced.
The annual subscription fee to our Tax Investigation Service is excellent value for money. In the event of an enquiry our Service enables us to:
• Make sure you have the strongest possible representation in the event of a tax or VAT enquiry
• Deal with the tax authorities on your behalf
• Handle correspondence and attend meetings with the Inspector
• Negotiate the best possible result for you
In addition the subscription gives you access to a Business Legal Helpline covering Employment Law, Health & Safety and Commercial matters. In an increasingly litigious society, keeping up to date with changing legislation and protecting your business is made simple with easy 365 days a year access to this essential helpline.
COULD YOU WITHSTAND THE COSTAND UPHEAVAL OF A TAX INVESTIGATION?
chance to declared that income. It applies to those who are an employee, resident in the UK and have additional income from working for themselves.
• The Let Property Campaign gives an opportunity to report previously undisclosed taxes on rental income to HMRC under the Let Property Campaign for individual landlords renting out residential property. This scheme can’t be used by companies or trusts, or if those renting out commercial property.
MAKING A DECLARATIONIn all cases, tell HMRC about additional income by filling in a notification form, and a disclosure form to disclose, and pay amounts owed within 4 months (3 for the let property campaign) of receiving HMRC’s acknowledgement of the notification.
If a voluntary disclosure is not made and HMRC finds out later that tax is owed, higher penalties or criminal prosecution could apply.
Don’t leave yourself and your business exposed to the risk of a costly investigation.Sign up or find out more by calling Christine McAneney on 01582 540800 TODAY!
If you are affected by any of the above issues, call your usual FK advisor now.
continuation THE RESULTS OF HMRC CAMPAIGNS
In year filing penalties for late submission of an RTI return will be delayed until 6 March 2015 for PAYE schemes that have fewer than 50 employees. Late filing penalties for PAYE scheme that have more than 50 employees started on 6 October as originally planned.
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RTI FILING PENALTIES DELAYED FOR SMES
CALCULATING HOLIDAY PAY
Businesses are facing additional costs after a tribunal ruled that overtime should be included in holiday pay calculations. The Employment Appeal Tribunal recently ruled that employers must factor in overtime when calculating holiday pay, instead of only taking basic pay into account.
The key is whether overtime is classed as guaranteed (where the employer is obliged to offer and pay for agreed overtime, non-guaranteed (where the employer is not obliged to offer overtime but if it is, the worker is obliged to work it) or voluntary (where there is no contractual obligation and the worker is free to turn down requests to work overtime).
Permission has been given for the right to appeal, and is expected, but at the time of writing no appeal has
been lodged.
In the meantime any employers who currently pay overtime are advised to contact their HR
advisor regarding how this ruling will affect them, and what temporary measures may
need to be put in place. Employers who are affected and need help calculating
the payments can contact FK payroll manager Christine McAneney for assistance.
Guidance on the key points is available at http://www.acas.org.uk/index.aspx?articleid=4109
The revised advisory fuel rates issued by HMRC, which came into effect on 1st December 2014. These are the recommended payments per mile that employers may use to reimburse employees for the cost of fuel used for business travel in their company car. They may also be used where an employer requires an employee to repay the cost of fuel used for private travel. Petrol hybrid cars are treated as petrol cars for this purpose. They do not apply to vans.
COMPANY CAR ADVISORY FUEL RATES
Engine Size Petrol LPG Diesel
1400ccor less
13p 9p -
1401-2000cc 16p 11p -
1600ccor less
- - 11p
1601-2000cc - - 13p
Over 2000cc 23p 16p 16p
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HEADLINE MEASURES❖ Stamp Duty Land Tax: SDLT will be charged only on the portion of the purchase price within each band with effect for purchases on or after 4 December 2014. If you exchanged contracts before 4 December 2014 but complete on or after that date there is an option to be charged under either the old or new rules.
AUTUMN STATEMENT 2014:KEEPING ‘ON COURSE TO PROSPERITY’
Year 21 and over 18 to 20 Under 18 Apprentice*2014 (current rate) £6.50 £5.13 £3.79 £2.73
2013 £6.31 £5.03 £3.72 £2.68
2012 £6.19 £4.98 £3.68 £2.65
2011 £6.08 £4.98 £3.68 £2.60
2010 £5.93 £4.92 £3.64 £2.50
From October 2014 the national minimum wage rate is:
KEY POINTS FOR SMALL BUSINESSES❖ Incorporations: Entrepreneur’s relief and Corporation Tax relief on goodwill has been withdrawn from 3 December 2014 on the acquisition of a business from a related individual or partnership. This removes a previously significant benefit of incorporation.
❖ Research and Development: Small increases in the R&D rate from 225% to 230% for small businesses with effect from 1 April 2015.
❖ Employers NIC Allowance: £2,000 allowance remains in place and from April 2015 extended to those who employ care and support workers
❖ Small Business Rate Relief: extended to April 2016, giving 100% relief to the smallest businesses. New discount up to £1,500 for small retail and food/drink premises.
KEY POINTS FOR PERSONAL❖ Thresholds: Tax free personal allowance increases to £10,600 from 6 April 2015, and the higher rate threshold, at which income tax is payable at 40% increases to £42,385
❖ Pensions: Savers will be able to access their defined contribution pension as they wish at retirement from April 2015.This will be subject to their marginal rate of income tax, instead of the current 55% charge for full withdrawal.
❖ Pensions: Further to the recent announcement regarding people being able to pass on their pension pot to the next generation, the government confirmed that if the individual dies before age 75, the beneficiary will pay no tax on the funds. If death occurs after the age of 75, the beneficiary will pay their marginal rate of income tax, or 45% if the funds are taken as a lump sum payment. The lump sum payments will also be taxed at the recipient’s marginal rate from April 2016.
Further detail is available on our website http://www.fkca.co.uk/tax/autumn-statement-2014Contact us to discuss how any of the measures announced in the Autumn Statement may affect your finances.
The final Autumn Statement of this Parliament was delivered by Chancellor George Osborne against a mixed economic backdrop.
The Office for Budget Responsibility (OBR) said the UK economy will grow by 3% in 2014, faster than France, Germany and the rest of the Eurozone. The OBR has doubled its forecasts for employment growth, with 500,000 new jobs having been created in the last year. And the deficit, as a percentage of GDP, has been halved since 2010.
Despite the positives, real risks remain within the global economy. The Chancellor promised to “finish the job” and build a “secure economy that works for everyone”.
NATIONAL MINIMUM WAGE
Purchase price of Property (£) New rates paid on the part of the property price within each band
0 - 125,000 0%
125,001 – 250,000 2%
250,001 – 925,000 5%
925,001 – 1,500,000 10%
1,500,001 and over 12%
Growth vouchers are available to small and medium sized businesses seeking strategic advice until March 2015. Key areas of advice are Raising finance and cashflow, Recruiting and developing your staff, Improving leadership and management skills, Marketing,
attracting and keeping customers, and Making the most of digital technology. Businesses will be randomly chose to receive a voucher of up to £2,000 to help finance half of the cost of the advice. Apply online athttps://www.gov.uk/apply-growth-vouchers
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Innovation vouchers are open to all kinds of smaller businesses from 10 November 2014. You can claim up to £5,000 towards the cost of expert advice if you are running an SME – or just starting up. The funding encourages you to seek out fresh knowledge that can help your business to grow and develop. That could include advice on an innovative
idea, learning more about using design within your business or how you should make the most of intellectual property.100 Vouchers will be awarded by ballot every three
months and the first round of applications is now open online at https://vouchers.innovateuk.org, closing
21 January 2015.
INNOVATION VOUCHERS
The British Chambers of Commerce (BCC) has published the results of its Quarterly Economic Survey for Q3 2014. The survey, made up of responses from more than 7,000 businesses across the UK, shows that whilst the economy is still growing, it slowed in Q3. Balances for both manufacturing and service sector exports were down on the quarter, highlighting the challenges facing UK exporters.
A decline in the rate of growth in Q3 for the UK manufacturing sector reinforces the BCC’s most recent Economic Forecast that predicted economic growth would slow leading into 2015. BCC Director General, John Longworth, says the results for domestic manufacturing and exports in this quarter may be the ‘first alarm bell’ to warn of slower economic growth.
The BCC is recommending that all political parties show support for the proposals within its Business Manifesto: ‘A Business Plan for Britain’ to create the best possible environment for growth and enterprise.
Despite this, business confidence remains higher than the 2007 pre-recession levels, for both manufacturing and service sector profitability. In addition the employment and cashflow balances rose in both manufacturing and services sectors since Q2.
HOW’S BUSINESS IN BEDS? Q3 BRITISH CHAMBERS OF COMMERCE ECONOMIC SURVEY
GROWTH VOUCHERS
Monday 22nd – Tuesday 23rd December OpenWednesday 24th – Friday 26th December ClosedMonday 29th – Wednesday 31st December Open (reduced team)Thursday 1st January 2015 ClosedFriday 2nd January 2015 Open (reduced team)
Anyone working towards an end of December deadline for the submission of accounts to Companies House should aim to get signed accounts back to us in good time to allow for the holidays and avoid any late filing penalties.
FKCA OFFICE CLOSURE - DON’T MISS YOUR DECEMBER DEADLINE
The full report, and the BCC’s response to the Chancellors Autumn Statement, is available on the news section of the Chamber websitehttp://www.chamber-business.com/news/
The ‘Cloud’ buzzword is everywhere at the moment, and accounting is no exception. The past year has seen a plethora of Cloud based accounting packages come onto the market, but how do you know if this is the right solution for your business?
Cloud accounting is potentially a new and innovative way of maintaining your accounting records, allowing you to access live data from any internet connection, fixed or mobile and can help you stay up to date with your finances on the go.
As internet connection speeds have increased over the years, the cost has fallen, and Broadband is now “the norm” making internet faster and more accessible. Consequently businesses now have the option to operate all of their key software packages online.
As a result the need to purchase your own software and host it on your own PC or network is no longer the only option. Cloud accounting can bring benefits from operating your software over the internet, such as:
• Being able to share and review data from almost any location in the world without the cost implications or complications of establishing a wide area network.
• Data is automatically kept off site reducing the worry of security issues and leaving someone else to worry about most of your disaster recovery issues.
• The software is hosted on a specialised server; this usually more powerful than most local PCs and you will probably find that the software runs faster
• Cash flow is assisted by spreading the rental costs into monthly payments, rather than the one upfront cost of purchasing the software.
• There are no upgrade costs as this is all dealt with by the website hosting the software and is factored into your regular payment.
A significant benefit of online accounts packages is the ability for your accountant to have shared access to your live data. We can log on, review and amend the information without the need for travelling or exchanging data backups, which will improve the quality of your management information and reduce associated costs and down time.
As with anything, there are risks associated with Cloud based packages, and potential users should be aware of and weigh up the pro’s and con’s when considering what route to take:
• There is usually no back up facility, so if something is entered wrongly, it has to be manually corrected
• Monthly fees can be more expensive in the long run, particularly if packages are usually only upgraded every few years or more
• Cloud based packages are usually simpler, so will not suit every circumstance
• There is currently only limited compatibility for linkage with other packages
• Web based packages are subject to internet risks over security of data
• The package cannot be accessed if there is no available internet
So whilst Cloud based accounting is not suitable in every circumstance, where is it the right option they have the potential to revolutionise the way in which information is stored and shared, giving users instant and easy access to better quality information.
CLOUD ACCOUNTING
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AUTO ENROLMENT
If you have read previous newsletters, you will have heard of Auto Enrolment by now – the mandatory requirement for all employers with more than one person on the payroll to automatically enrol eligible staff members into a workplace pension scheme AND contribute into the fund.
Although the new obligations fall to employers, as the processes are closely linked to payroll we are pleased to confirm our auto enrolment service will be available from 1 January 2015, to ensure you comply with the requirements.
In addition, if you need assistance with the initial assessment of employees, arranging a workplace pension
scheme and communicating these changes to staff we are pleased to provide a staging service to help guide you through these requirements. We can also talk to you about options to reduce your costs, such as implementing salary sacrifice.
Factsheets are available on this new service, and we will be writing to clients individually as their staging date draws closer. If in the meantime you need help managing the staging process please act now and tell us as soon as possible, as the closer it is to the staging date the harder it will be to set up a scheme to suit your needs and meet your commitments in time.
FKCA LimitedRegistered office: Prospero House, 46-48 Rothesay Road, Luton LU1 1QZ
Telephone: 01582 540800 Fax: 01582 480901 Email: [email protected] Web: www.fkca.co.uk
Designed and Printed with Variable Data by DX Imaging, Watford WD18 8EA 01923 227644 [email protected] www.dx-imaging.co.uk
Please note that we cannot be held responsible in any way for any consequence arising from the information provided in this newsletter. Whilst every effort is made to ensure the accuracy of the content of all FK publications, no decisions should be taken on the basis of information given without reference to specialist advice.
Do we contact you enough? Or maybe too much?Do we contact you in the format you would like?We at FK want to make sure we strike the right balance of communications with our clients, so we would like to know your thoughts to ensure we deliver what you want and how you want it:
Other comments or suggestions...
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Communications Survey
Who’s in Your Address Book...Do you know anybody else who would like a free subscription to ProActivity?Perhaps a supplier or customer?Simply give us their details and we will invite them to subscribe free of charge as a gift from you.Call Tara Aldwin on 01582 540800 ore-mail [email protected]
Tara Aldwin
Editor and Director
Chris Howe
Director
Foxley Kingham
Seasons Greetings to all our loyal clients and
associates, may we take this opportunity to thank
you for your continued partnership over the past
year and to wish you a very Merry Christmas and
a happy, healthy and prosperous New Year!We will not be sending Christmas cards but instead making a donation to
Luton & Dunstable Hospital Charitable Fund, for their Neonatal Intensive Care Unit.
Do we contact you?
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