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Pension Death Tax!
Currently if you die before you have started to draw your pension, the value of your pension fund will not usually be subject to inheritance tax (IHT) at 40%, as it is excluded from your estate. However, there can be a 55% tax charge where your pension fund is passed to someone else under your will, especially if you die aged over 75. From 6 April 2015 the 55% tax charge will be abolished. If you die before you reach age 75 you will be able to pass on your pension fund on death to any one you choose without [...]
Mini One Stop Shop – VAT on EU Sales
This sounds like a friendly retail outlet where you might buy a pint of milk on a Sunday evening. In fact it is short-hand for the online portal which UK businesses should use from 2015 to account for VAT they owe in respect of digital services provided to customers in other EU countries. We mentioned this new rule in our July 2014 newsletter. "Digital services" includes a multitude of products such as: music downloads; video on demand; electronic books; online games; anti-virus services; software purchased by download; charges by online auction sites; sales of data or images online; and automated [...]
November 2014 Q&A
Q. Last year I bought a run-down pub and converted it into a restaurant. I registered for VAT after the work was done, but before the restaurant opened. Can I reclaim any of the VAT paid on the costs of converting and fitting out the restaurant? A. It is easy to see with hindsight, but you should have registered for VAT at the point you started the conversion work. You can claim back VAT charged on services incurred in the six month period that ends with the date you registered for VAT, which might not cover all of the conversion [...]
If I change my business activity what happens to my tax losses?
We've had a couple of enquiries recently from people changing trades and hoping to use the losses from the old business against the profits from the new one. The rules are quite strict where losses from previous years are carried forward - in general they can only be used against the old trade. There are some useful ways of using losses in the early years of sole-trader businesses to claim back personal tax paid in previous years.
How to Borrow From your Own Company without Falling Foul of the Law
A number of company directors receive loans from their companies, either to reinvest in the business or for personal use. Until recently the laws surrounding such a transaction have been stringent. However, from the 6th of April 2014 things have changed, albeit for the better, making it easier to take loans from your own company. This article will briefly cover the rules pre-April 2014 and then the new changes. The Rules Pre-April 2014 Previously when an employee of a company received an interest free or a very "cheap" loan it could be treated as a taxable benefit. The interest rate [...]
VAT on Digital Services
Do you sell digital services such as: music or software downloads, e-books or online videos? If so, do you know where your customers are, and whether they are businesses or individuals? From 1st January 2015, when you sell digital services across international borders you will have to collect information about your customers to determine if they are businesses or not, and where they are based. Where your international sale is to a non-business customer, from 2015 you will have to charge that customer VAT of the country where he or she is located (if that's in the EU). You will [...]
How to Face the Threat of Business Insolvency Positively
In most cases the failure of a business is treated as a personal failure. Your ego may stand in the way of taking the necessary actions to try and resolve your financial predicament, especially when creditors are knocking on your door every day. There is light at the end of the tunnel if you take action and you may still be able to rescue your business. This article will show you 5 steps you can take starting today to help recover your business. Cease Trading As long as you are trading then creditors will assume you are bringing money in [...]
Estimating sales
It's common practice for business owners to estimate sales by focussing on total revenues and using that to drive their business plan. But, if you think about it, that doesn't make sense. Whether you succeed or fail, you will have no idea how or why it happened. You're flying in the dark. It takes a little more time, but your sales forecast should start from the bottom up and in as much detail as you can. You clearly need to know the sales price of your products and services, but you can also calculate an average sales value, based on [...]
Without Wishing to Sound like the Special One…
The strangest thing has happened. I've spent the last 18 months telling the world how different we are; how we're more interested in helping your business to make money next year than in telling you how much you made last; how we are totally focused on your bottom line. I now realise I was wrong. It's not just what we do that makes us different. It's what we are. And it took me a while to realise that natural modesty can sometimes fog our attempts to say what we mean. You see, the reason that TLA Business Services can make [...]
When networking is not working
We'd all agree that we prefer to do business with those we know, like and trust. It follows, then, that if we can encourage these traits in others, our businesses should benefit. Most of the time, knowledge, likeability and trustworthiness are earned as the result of doing business with each other. But it's not the only way. There is another route to earning mutual respect that doesn't come from doing business but could very well lead to it. I'm talking about networking. For some businesses it's an integral part of what they do but for others, networking is simply not [...]