It’s now less than 12 months before many businesses will need to comply with Making Tax Digital (MTD) for VAT. If your business is VAT registered and your annual turnover is above the current VAT turnover threshold of £85,000, you will be among the first to switch to the government’s new mandatory scheme from April 2019.
MTD is HMRC’s programme to introduce a digital tax system. Ultimately, MTD will require most businesses, self-employed people and landlords to use digital software to keep tax records and update HMRC on a quarterly basis. Digital tax accounts will enable us to see all our tax information in one place, with some information being sourced directly from banks and other third parties.
VAT registered businesses are already used to filing quarterly returns, and for those using cloud accounting systems, the impact of MTD is expected to be relatively small. But for those businesses managing their finances on spreadsheets, or those with complex VAT arrangements, MTD is likely to require some significant changes, which could have financial implications.
Our tax team is working hard to clarify exactly what will be required, when, and will be keeping you updated. We will be writing to all affected clients in the coming weeks so you can start preparing in good time. If you have any queries in the meantime, please contact us.
The new tax year is officially underway, and with it come a few important changes to be aware of.
These include an increase in the personal allowance to £11,850 across the UK, with the higher rate threshold increasing to £46,350 for England, Wales and Northern Ireland.
The tax-free allowance on dividends has reduced from £5,000 to £2,000, but tax on dividends will remain at the same rates for 2018/19.
Dividends which take your total income above the personal allowance but within the basic rate (£13,851 - £46,350) will be taxed at 7.5%. Those whose total income is between £46,351 - £150,000 will see dividends above the £2,000 allowance taxed at 32.5% or 38.1% for those with income over £150,000.
Capital gains tax annual exemption has increased to £11,700. Changes were also made to the indexation allowance that is used to calculate capital gains for companies, so that any assets disposed of on, or after 1 January 2018, will only have indexation allowance calculated to December 2017.
On a positive note, the residence nil-rate band, (RNRB) which enables eligible people to pass on a property to direct descendants, has risen from £100,000 to £125,000. And while adult ISA allowances remain at £20,000, junior ISAs saw a modest increase in allowance from £4,128 to £4,260.
All the new tax calculations are included in our new Tax Facts booklets for 2018/19. If you haven’t yet received a copy and would like one, please get in touch.
HB&O wins Team of the Year!
We are thrilled to announce that HB&O won Team of the Year at the Coventry & Warwickshire FirstPro Awards. Our team was presented with the award at the gala dinner at Coombe Abbey on 19th April.
FirstPro showcases the depth and breadth of talent in the professional services sector in the region and, for the first time this year, included categories to recognise the work of teams as well as individuals.
This award looked to acknowledge the team who showed evidence of collaboration and team spirits, along with the combination of talent within the firm.
Managing Director, Mark Ashfield said: 'It is a fantastic opportunity to be able to recognise the hard work of those within HB&O and acknowledge everyone's contribution to the overall success of the team. We would also like to offer a huge congratulations to all the other winners."
The Leamington Business Awards are open for entry!
Harrison Beale & Owen is delighted to be organising the fifth Leamington Business awards, which are now open for entry.
This year, the Leamington Business Awards dinner will take place at The Assembly, which offers larger capacity in the heart of the town, meaning more people will be able to join the celebrations on the 16th November 2018.
For the first time, the Leamington Business Awards will feature a category open to organisations across South Warwickshire. The South Warwickshire Achievement Award, sponsored by Warwick District Council, is designed to showcase inspirational businesses and charities who have a strong connection to Leamington, but fall outside the traditional postcode boundary for the awards.
Entry to the awards is now open and will close on 30th June. Winners will be announced on 16th November at a black-tie awards ceremony, featuring a drinks reception, three course dinner and entertainment.
Sarah Wilson appointed Chair of DFK International Marketing Committee
HB&O Director, Sarah Wilson, has been appointed as the new Chair of the DFK International Marketing Committee. Sarah will be responsible for directing the work of the committee which supports 220 firms across 93 countries worldwide.
The DFK International Marketing Committee (IMC) develops and maintains marketing campaigns to promote the international network, as well as sharing knowledge and skills across the network to enable clients worldwide to access innovative, high quality services.
Sarah Wilson has taken on the role of Chair following her involvement with the DFK International Future Leaders’ Conference in February and in recognition of HB&O’s experience in building a strong brand.
Why your approach to customer service should be part of your business plan
Do you remember how receiving great customer service made you feel?
If you don’t, it may be fair to say it doesn’t happen enough. But surely this shouldn’t be the norm? After all customers are the lifeblood of business.
Part of our role at HB&O is to support our clients in growing their businesses.
When it comes to developing their business plan, alongside product/service development, financial considerations and marketing ideas, we encourage our clients to think about the ethos that will underpin their business - how will they attract and retain customers in the long term?
Companies can fail for several reasons and, for the most part, these aren’t the result of wrongdoing by the directors. For this reason, it’s perfectly legal to start a new company after an old one has become insolvent. However, there are a number of rules that surround carrying on a similar business through a new company after the original company has gone into insolvency.
Known as ‘phoenixing’, this practice transfers the business, but not the debts, of the insolvent company to a new company.
But what is the problem with phoenixing, and what does the law say about it?