Which VAT code do I use in my software?
For VAT registered businesses, there are many VAT codes that can be chosen. It is easy to get them wrong, leading to errors and possible under-declarations of VAT or reclaiming too much input VAT. Whilst many software packages try to help by offering “default” settings, care is still needed. As an example, motor expenses may […]
Making Tax Digital for VAT – are you filing returns through the MTD portal?
All businesses have to use MTD for VAT returns due on or after 1 April 2022. This means keeping digital records too. This could be spreadsheets or accounting software, or another option is dedicated bank accounts with inbuilt accounting and VAT filing. Please do not leave this to the very last possible minute to take […]
Inheritance Tax and gifts out of income
There is a £3000 annual allowance for gifts – a very small amount! However, another exemption which might be useful in helping to reduce potential IHT liabilities is for regular gifts from surplus income. If gifts do not qualify for this exemption, the donor needs to survive 7 years from the date of the gifts […]
Would the VAT Flat Rate scheme save you money?
Under the VAT rate scheme, a flat percentage is used to calculate the VAT payable, ignoring VAT incurred on expenses. This can save some work as well as money. The flat rate % depends on the type of trade. If you have two or more different types of business, the flat rate % is determined […]
Reimbursing staff business expense claims
The processing of expense claims can be both time-consuming from both the employer and employee viewpoint. Collecting expense receipts, then summarising and analysing them onto a spreadsheet, then taking the spreadsheet and rekeying that data into the accounting software all takes not insignificant amounts of time. The expenses then must be reimbursed – and someone […]
Saving for your pension – beware the annual limits
The maximum annual allowance for pension contributions is currently £40,000 p.a. although it is possible to use up some past years’ reliefs. As indicated above, this may possibly change in the 2021 Budget. However, as with most things’ “tax”, it is not that simple. Levels of income and the contributions to the pension scheme can […]
Budget – 27 October 2021
Following on from the increases above, the Chancellor will present his next budget on Monday 27 October 2021. It is highly probable that further increases in taxes etc will be announced. Some changes may even take effect from midnight that day. The rumour mill indicates a potential rise in Capital Gains Tax rates (to possibly […]
Changes to NI rates for 2022/23
From April 2022, the Government plans to create a new social care levy which will see UK-wide tax and National Insurance Contribution (NICs) increases. There will be a 1.25% increase in NICs on earned income, with dividend tax rates also increasing by 1.25%. The employer will see increased costs–the Employers NI rates increases from 13.8% […]
Automated Invoice processing
The prior article referred to invoices being duplicated. Using one of the purchase invoice data extraction products can help to prevent this type of error occurring as potential duplicates can be detected prior to entry into the accounting records. With more and more invoices coming into the business in electronic format – often PDF files […]
Bookkeeping – review your “aged payables” report regularly
If you are using purchase ledgers – recording purchase invoices when received – these will appear as owing and then reduce to Nil when paid. When preparing annual or more regular accounts, we will look, in particular, at the “old” balances on the aged reports – the column that is outstanding for 3 months or […]
