1. For the wife to be paid a small amount, she was involved in a number of administrative roles within the business.  This has to be restricted to £95 per week otherwise the Carer Allowance would be restricted.  A matter of note is that if you are in receipt of Carer Allowance, all of your basic NI contributions are covered.
2. As the client made large contributions under Gift Aid his basic rate tax band was already in excess of £37400 limit.  His income could therefore go up to this greater limit without paying tax at the higher rate.  Clearly if he wished to and had the finances he could increase the amount given under gift aid to increase this further.
3. He wished to make a pension contribution and having planned in advance of the end of the tax year, I was able to advise him of how much he could pay to avoid having to pay higher rate tax by extending his basic rate band further.
4. He did not necessarily want to make too large a pension contribution as he is approaching retirement age so he now has the choice to make a smaller pension contribution and potentially fully utilise his ISA allowance of £10,200 for 2009/10.
5. He had not been advised on what expenses he could claim on his company and I was able to assist him in this area, covering items such as use of home as office, and claiming the mileage rate.  He had also just gone over the VAT limit, a fact he could easily have missed as he had excluded part of his income.
6. He has now secured a full time PAYE position so the company may or not be retained but the moral of the story is to get advice early to make sure you:
   1. do not miss out on opportunities and
   2. also avoid the pitfalls.

We hope you find the contents of this blog useful, you should of course always seek professional advice for your specific needs.  Alastair Wood, AW Accounting  – Accountants who “speak your language”

accountants are now seen as the most trusted source of business advice

for UK firms, we consider why you should have an accountant and how to choose one.

A qualified accountant is an experienced professional and will be able to act as your finance specialist allowing you to concentrate on spending your time running the business.  From a business perspective they can assist in making the most of the information you have whether interpreting existing information or planning where to go next.  They will also be able to make efficient use of your resources so that you do not end up with a bookkeeper doing lots of work to complete VAT Returns yet miss out on the advantages of producing meaningful management accounts for little extra effort.

Due to the number of businesses that accountants come across whether clients or trade contacts, they are also sources of information on company structuring, personnel matters and financial implications of contracts.  They may well also be able to help you find business services from recommended suppliers.

However the bread and butter of the accountants work is tied up in compliance services for businesses and individuals to comply with government tax rules and cover:

• Preparation of accounts
• Preparation of corporation tax or partnership tax returns
• Individuals tax returns
• Payroll services
• Bookkeeping and VAT services
• Dealing with HMRC investigations
• Company formation

Larger and more specialist firms may also be able to deal with

• Auditing
• Specialist tax planning
• Advising on tax treatment in specific areas (eg VAT and property)

How do you set about choosing an accountant?

This decision is a matter of your personal requirements, one of the best ways is by recommendation but you do need to make sure you are fit into the same category as the person who has recommended, the service may be great for them, but not so good for you.  You should always have a meeting or speak on the phone to see if you get on from a business footing, as mentioned earlier there must be a level of trust between adviser and client.  Other areas you can look at and consider are:

• How proactive are they?
• How do they communicate (face to face, telephone, email)?
• What do other clients say about them?
• What do the testimonials on their website  say?
• Do they have newsletters/blogs or information sheets to help out?

The choice is largely personal as I was reminded at a recent event , “people employ people” not businesses.  Whatever choice you make I hope it serves the purpose you want it for.

Alastair Wood – AW Accounting “the accountant who speaks your language”

1. Small claims can be made on line using HM Court Service website, moneyclaim.gov.uk.  There is useful guidance on the HMCS website.
2. There is an excellent flowchart on p11 of the HMCS Guide for debt recovery for Small Businesses
3. Once Judgement has been registered by the court the customer is obliged to pay you, however this is where so many businesses stall and where The Sheriffs Office can come in useful, the following is the process as shown on their website:

If you have a County Court Judgment or Order over £600 (including court costs) or a High Court Judgment or Order up to 6 years old then you have come to the right place. For a court fee of just £50, we will ‘transfer-up’ your judgment to the High Court for Enforcement free of charge.
Our Nationwide team of experienced High Court Enforcement Officers offer the highest collection rates in the country which are monitored by the Ministry of Justice. In 2008 we averaged 96p in £1 on enforceable debts.

Unlike others, we do not send letters warning of our intended visit. A warning often prompts the defendant to abscond or hide/sell any assets they may have.

Our first point of contact is a prompt visit by our High Court Enforcement Officers to the defendant’s premises to seize goods, chattels and other property. These can be removed and sold at auction if the defendant fails to pay the sums due. Our extensive powers include the ability to force entry to commercial premises (including shops, warehouses and barns) for the purposes of this seizure.

We are to collect the judgment amount, your court costs, your ‘transfer-up’ fee, interest at 8% and our fees, costs and charges from the defendant. We do not take a percentage of the money that you’re owed as many debt collectors do.

Unlike many of our competitors, all of our High Court Enforcement Officers carry portable Credit/Debit Card Machines allowing easy secure Chip and PIN payment by the defendant. At present, this accounts for 70% all of all payments collected.

We will keep you updated at every stage of the enforcement process, requesting your further instructions if necessary.

Thanks go to the Sheriffs Office for allowing us to use this information, and we hope that this will help you to collect outstanding debts but accept no responsibility if the action is unsuccessful.  Alastair Wood, AW Accounting  – Accountants who “speak your language”

1. Is the shareholding in the company arranged in the most tax efficient way? A gift between husband and wife is tax free, but should not be done regularly as it may be treated as a right to income
2. If available have the maximum dividends been declared to make full use of the shareholders personal allowance and basic rate tax band (and minimise and higher rate tax if applicable).  If not now is the time to look at it not on 31 March!
3. If no directors remuneration has been paid for a cash poor new business consider running the payroll as this will have 3 advantages:
   1. If paying above ~£475 per month the full years NI contribution will count
   2. Even if there is no cash available, this becomes due tax free to the director when there is cash
   3. This is a taxable expense and even if there is no corporation tax saving this year, a loss can be set against future years profits
   4. If the company did not trade immediately after incorporation, consider extending the year end at Companies House so you can easily compare the first year to subsequent months. This will also delay the date corporation tax is due.

Time is short, make the most of the tax opportunities you have.  Alastair Wood, AW Accounting  – Accountants who “speak your language”