Hi everyone, welcome to the first of my columns! I must say I am very excited for my first foray into journalism. My monthly columns will be full of tax and accountancy advice and stories and up to date developments from the world of finance, so I think everyone, from individual to company director will find them interesting and useful. I really want to give you a new perspective on accountancy and tax matters and not bamboozle you with the usual accountancy jargon.
A bit of background about me, I am a chartered accountant with my own firm, Time Accounts that I run with my business partner Michael. We are based in Hove and have been up and running for over 7 years now. I am also a mum of two small children under the age of three so daily life is a juggling act but never boring!
So its been a busy month for Time Accounts, we have moved to a bigger office and attended a fantastic tax course where we picked up some great tips which I will of course be sharing with you all!
It is also set to be a busy month in the world of finance. On 18 September Scotland will be voting on whether to become independent and leave the United Kingdom. What will the impact of such a devolution mean for Scotland and the rest of the UK? The interesting things for us to consider is how the tax system would be separated if it was a yes vote? What will happen to HMRC call centres in Scotland? Will the jobs migrate to England, Wales or Northern Ireland? How would self assessment work for Scottish businesses and individuals? We will wait to see how Scotland decides in a week’s time!
I have struggled over what to base my first column on but I have finally settled on something that will be of interest to all business owners, Annual Investment Allowance. Everyone loves 100% tax relief!
Almost any business, be it limited company, partnership or soletrader can claim a tax allowance each year called ‘Annual Investment Allowance’ (AIA) for investing in plant and machinery.
So if you’re running your own business, buying tools and machinery that you need to carry out your trade will qualify for tax relief. Even computer equipment, office furniture, vans and building fixtures qualify.
AIA offers tax relief at 100% on qualifying capital expenditure in the year of purchase. It allows businesses to make investments and as a result pay less tax on their profits.
To offer a huge helping hand to businesses, the maximum amount of the AIA was temporarily increased to £250,000 from £25,000 for the 2 year period from 1 January 2013 to 31 December 2014.
The Government then implemented a further increase in the AIA and doubled it to £500,000 for expenditure incurred on or after 6 April 2014 (1 April 2014 for companies) and before 1 January 2016.
This measure is designed to stimulate business investment in the economy by providing incentive for businesses to invest in plant or machinery.
On 1 January 2016, the AIA looks set to revert back to £25,000.
Don’t worry, even if you are currently making a loss in a financial year, you do not lose the benefit of the AIA.
Therefore now is the time to invest in your business!! Do not wait, as this tax break is time limited.
Just a note, it is worth seeking professional advice for further details and clarity as to what does and what doesn’t classify as plant and machinery before embarking on expenditure.
Each month I will highlight some important dates so no one misses any of those important deadlines. Remember company accounts with a 31 December year end need to be filed at Companies House by 30 September or a £150 fine. Quarter ended August VAT returns to be filed and paid by 7 October and August PAYE to be paid by 19 September. Plus as of 1 October the national minimum wage is increasing to £6.50 an hour for those over 21 (other rates apply for apprentices and younger workers) so if you employee anyone on minimum wage please remember to make this change.
I hope you found my first article useful. Please remember to interact with me and let me know if you want anything covered in the next article.
My email address is hannah@timeaccounts.co.uk or you can follow me on Twitter @timeaccounts or visit our business Facebook page (Facebook/timeaccounts). Remember to like our page so you can keep on top of tax saving tips, deadlines and general Time Accounts updates.
Hope to catch you next month. New column coming Thursday 9 October!
Time Accounts t/a Time Business Services are a local Sussex based chartered accountancy practice dealing with all aspects of small, medium enterprises and their financial requirements, so just pick up the phone and call 01273 446595 or send us a call back request via our website Time Accounts and we’ll do the rest!
