February 2007 Newsletter

Contents 

A New Partner announced

New Years resolutions

Income Tax surcharges

Payroll Year end forms

Benefits in Kind on Vans – changes in April

Legal changes affecting websites and emails

VAT – Bulgaria and Romania

Tax Inspector incentives

Refunds of national insurance

New Institute scheme 

New Partner

Morgan Davies has been made a partner of the newly-formed Prime Chartered Accountants and will be based at the Coventry office.

Morgan, a chartered accountant, joined the firm as senior audit manager two years ago – when it was known as Pilley & Florsham.

Prior to joining the firm, Morgan was a partner with a Staffordshire accountancy practice. Before that he was with Grant Thornton in Birmingham where he managed a portfolio of clients and supervised their larger audits. Morgan can be contacted at the Coventry office on 024 7622 0208 or by email here.

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New Years Resolutions

Consider making some New Year’s resolutions for your business as well as for your personal life – they are arguably more important because if your business runs smoothly and improves, your personal stress level reduce and your personal life will improve. Here are some ideas from the Prime Group which we use in running our business:

• Have a plan for the year ahead – this could be a carefully calculated detailed budget or a simple target for monthly turnover and gross profit earned on that turnover
• Find out what your breakeven point is
• Make sure your accounting records are up to date and accurate
• Make sure you have regular management information which you can understand – this can be very simple or very detailed but you must have something to use when making decisions
• Have a system for chasing your debtors, late payments to small firms by their customers has steadily got worse since 2004
• Review your overheads – one of our clients carries out a free review of energy charges which we all know have shot up over the last few years. He did that for us and saved us money in our Coventry office and is now looking at our Solihull office.
• Review your business finance – can you reduce your borrowing costs?
• Consider whether you can you reduce some costs by outsourcing for example payroll
• Consider whether you are making the best use of IT in your business – computers are now cheaper than ever
• Document the systems you follow for key business processes – this can very simple but at least it will increase the chances of everyone knowing what they are supposed to be doing and introduce a level of consistency

If you want our help with any of the above contact us on 024 7622 0208 in Coventry or 0121 711 2468 in Solihull or visit our website

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Income tax surcharges

We have now passed the deadline for filing 2006 tax returns. Interest is now running on any unpaid tax. If any income tax is still unpaid by the end of February, a 5% surcharge will be added to the total due in addition to the interest charge.

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Payroll Year End Returns

 
HMRC are currently sending the year end P35 form out to Employers which must be completed and returned by the deadline of 19th May 2007 to avoid penalties.

If this form is filed online you will receive a tax-free incentive of up to £150. Contact Monima Das in Paysolve our payroll bureau on 024 7655 4321 if we can help you earn this!

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Benefit in kind for company vans - avoid the new charges!

From 6 April 2007, the benefit-in-kind for employer-provided vans will increase from £500 per year (or £350 for old vans) to £3,000 per year, with no reduction for old vans.

There will also be an additional benefit-in-kind of £500 where private fuel is provided together with the employer-provided van.

So, from 6 April 2007, it becomes increasingly important that the specific conditions that exempt both the van and the fuel from the benefit-in-kind rules are met.

Let us help you avoid these charges, contact Sarah Nickols in Coventry on 024 7655 4310 or Jan Hornby in Solihull on 0121 711 2468.

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Changes required to websites and email documents

The government has recently issued new legislation extending the requirements for companies to provide certain particulars about themselves on their websites and in electronic versions of all documents.

The new legislation became effective from 1 January 2007 and there are penalties for those who do not comply.

The changes mean that companies must disclose their name, place of registration, registered number and the address of their registered office on their websites.

Remember that where Prime offices are used as a registered office address that this address should be included on all emails (for details of our company secretarial services click here.)

EU regulations require VAT numbers to be disclosed.

This information must already be included on business letters and order forms. The new legislation extends the requirements to include this information to such documents in electronic format. As so many of us now conduct business correspondence by email, this has implications for the amount of information that must be included.

Please contact us if you want any more clarification on this.

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VAT - Bulgaria and Romania

HMRC have reminded businesses that Bulgaria and Romania joined the EU on 1 January 2007. This means that, from that date, all VAT registered businesses will need to include any trade with these countries in boxes 8 and 9 of their VAT returns.

Similarly, businesses that are registered for Intrastat will need to include this trade on their monthly Supplementary Declaration forms (SDs). The change may mean that some businesses become liable to submit SDs for the first time. Intrastat forms have to be completed where either acquisitions or dispatches with other EU countries exceed the annual limit. The limit was raised to £260,000 from 1 January 2007.

Please contact Jamie Skelding if you want any help with these returns.

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Tax Inspectors to receive bonuses

The Times has reported that Tax Inspectors are to be encouraged to collect more money by being given bonuses linked to the amount of revenue they bring in. We hope this won’t mean that HMRC pursue tax settlements just to raise money, as opposed to identifying actual errors.

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Refunds of voluntary National Insurance contributions

People who have made voluntary National Insurance Contributions to make up for gaps in their records may be able to claim a refund if they made the contributions since 25 May 2006.

The administrative procedures for handling refunds have not yet been finalised and we will keep you informed of developments on this.

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Institute launches New Scheme

SMEs will be able to get the expert finance advice they need with the launch of a new scheme by the Institute of Chartered Accountants in England and Wales, the ICAEW.

The SME Funding Adviser Scheme, which has been set up in response to a government initiative, aims to ensure businesses have access to a wide choice of independent professional advisers across the UK on a whole range of business finance options.

The ICAEW is one of a number of organisations that has worked with government to establish the new scheme. It will aim to meet the needs of SMEs and help them to address some of the key issues in raising finance.

Along with other ICAEW firms, Prime Chartered Accountants have signed up to the new scheme, registering our specialisms. These include advice on bank loans and overdrafts and business plans for bank and equity finance. For more details call Morgan Davies on 024 7622 0208 or John McDonald on 0121 711 2468.

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Prime Chartered Accountants
Coventry and Solihull
www.primeaccountants.co.uk

Prime Pilleys in Coventry operates as a Partnership.

Prime Rafterys Limited in Solihull is a limited company, number 5992054, incorporated in England and Wales, registered office address at 29 Warwick Road, Coventry, CV1 2ES

Disclaimer - for information of users
This newsletter is published for the information of clients and other recipients of our email newsletters. It provides only an overview of the regulations in force at the date of publication, and no action should be taken without consulting the detailed legislation or seeking professional advice. Therefore no responsibility for loss occasioned by any person acting or refraining from action as a result of the material contained in this newsletter can be accepted by the firm.