Hiring employees to your business is a sign of growth and expansion and something that should be celebrated. However, it can be a daunting process, especially if you don’t have any experience in hiring staff and employees. You must therefore be prepared to ensure that you have made a good decision and hired the right person.
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With the deadline for self-assessment tax returns now upon us, here we look at some of the most common mistakes taxpayers make on their tax returns, and how to avoid them.
All self-employed workers and company directors are required to fill out a tax return, and it’s important to get your tax return right to avoid incurring penalties. [continue reading…]
As a limited company owner, your company is liable to pay Corporation Tax on its profits. All UK companies are liable to pay tax on their profits, regardless of where in the world these profits were accumulated. We have put together this guide for your to understand what corporation tax is, how to account for it, be able to calculate it and the corporation tax rates and allowances.
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The current VAT threshold in the UK stands at £85,000. Any business that has an annual turnover of that value must register for VAT with HMRC, and when they do this they will receive a VAT number. Before you work with another business, you normally want to find out all you can about them and you can easily do this through a Google search. However, something you might not consider looking at is their VAT number, and this is actually something that you should definitely be verifying.
When your company turnover reaches the ‘VAT threshold’ (currently £85,000) in a twelve-month period, you must register for limited company VAT. Even if you don’t, there may be professional reasons why you would want to register anyway. So, how does the VAT registration for limited companies work?
If you set up a limited company, you are not legally required to appoint an accountant, although there are multiple benefits of doing so. In this article, we discuss if appointing a limited company accountant to look after your affairs a statutory requirement, or if can you take care of your accounting duties yourself?
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The alternative to setting up a limited company is to become a sole trader or a member of a partnership, for example, if you decide to trade a sole trader you will essentially be classed as ‘self-employed’. In this guide on how to register as a sole trader, you will be made aware of all the relevant taxes, optional taxes you can register for and how to actuallly set up as a sole trader/ sel-employed.
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For many companies, Keyman Insurance offers vital business protection against the death of a key person. You can also add Critical Illness Cover, which provides an extra layer of protection if the key person becomes critically ill. The most common critical illness claims are for cancer, heart attacks and strokes.
[continue reading…]Throughout lockdown, the Government has made significant financial contributions to UK businesses to help mitigate the economic impact of the pandemic by way of a £330bn war chest. Now that Britain is re-opening and adjusting to a new normal, HMRC will want to recoup as much of that initial outlay as possible through taxation.
[continue reading…]As a small business owner, there will be a number of business insurances that you will consider getting, from professional indemnity insurance to private healthcare insurance. Another type of business insurance you might consider getting is Keyman insurance, also known as Key person insurance.
[continue reading…]Starting a part-time small business is ideal if you want the security of employment whilst investing in a side business. Starting a business can come with great risks, and one of the main reasons that potential entrepreneurs are held back is for fear of their business failing. However with a combination of business skills and the right product, you can make your business a success. When running a part-time small business you also don’t have the life changing risk of failing hanging over your head, as you still have a steady income through your day job.
You’ll be aware that HMRC is bringing in new, stricter rules around using contractors and consultants, known as IR35 effective April 2020. These new rules are intended to stop contractors, freelancers and consultants being used as “disguised employees” to avoid paying tax and benefits.
[continue reading…]Changes to IR35 tax rules for contractors may only be two months away, but most contractors remain confused about what the changes will mean – and whether they need to do anything before the 6 April implementation date.
[continue reading…]Whether you are self-employed or are running a business on the side, you will have a personal tax account which you should be checking. However, research finds that nearly half of UK workers don’t check their account.
As an employer, managing maternity leave is an inevitable part of doing business. You will be understandably thrilled for your employee, whilst also wondering whether your team will be overstretched, or how this change might hurt productivity. On top of that, you have the financial commitments surrounding UK statutory maternity pay (SMP) to navigate. It can all end up feeling rather admin heavy.
When operating on a self-employed basis as a sole trader, you are your own boss, which means that you’re legally responsible for the financial affairs of your business, including the maintenance of financial records, daily bookkeeping and retaining the likes of invoices and receipts. As you keep close watch of your income and expenditure to ensure that the business is running smoothly, there are reporting obligations you are required to meet, writes Mark Halstead of Red Flag Alert.
A shareholder has the right to receive dividends. When the company has retained profit available, they may declare a dividend. A dividend is a share of profit paid out of the company which is proportionate to the number of shares held.
Readers question: I was wondering if I could get some advice about being self-employed and living abroad. I want to open a business account as a sole trader in the UK and pay my national insurance and pension to the UK. However, I live in Slovenia with temporary residency, as I am a British citizen. I live here as I got married to a Slovenian. I wanted to know how can I open as a sole trader as I work from home online teaching on a platform based in Asia. They just pay my salary nothing else. What would I have to pay to Slovenia as I live here and would I have to pay double social security? Or claim my benefits from the UK when I need them. Also, would I need a virtual office in the UK? My students, I just interact with them from the website the company provides.
Disgruntled creditors get desperate, and when all approaches to recover a debt have failed, they may send a winding-up petition to the beleaguered company as a last resort to get paid. It’s an extremely serious move and not one that should be taken lightly as it’s typically preceded by a statutory demand. In the UK, HMRC is the most common business creditor and is normally aggressive in its pursuit of tax liabilities. The majority (60%) of all winding up petitions are served by HMRC.
Readers question: We have a small Limited Company with a gross turnover of £20,000. We have paid 20% tax on this figure (cis) leaving £16,000 after tax. We have one employee who has earned £12,000 gross. Are we entitled to a rebate and will there be corporation tax to pay?
