Useful Info

Book Keeping Tips

Keep personal and business expenses and income as separate as possible.
Keep all receipts.
Try not to use cash for business expenses, unless you can get a receipt.
You do not need to have an expensive accounting package if you are a small company. An excel spreadsheet or even a written cash ledger will help to keep track of spending.
Try to plan in advance for major spending.
Open a separate account and transfer money weekly or monthly to it to cover costs such as VAT or tax payments.
Keep on top of your invoicing. Send invoices as soon as the jobs are complete. Chase for payment as early as possible and keep chasing.
Try to spend a short period of time every week keeping your book keeping up to date, this is far more effective than trying to get everything in order once a year.

What is Auto-Enrolment?

Auto enrolment or work place pension is the responsibility of every company that has one or more employees. You must provide a pension planning for your employees that both the employer and employee can contribute to.

Only sole traders, companies in liquidation or that have been dissolved and companies with directors that do not have employment contracts or any other employees are exempt.

For more information about your responsibilities visit www.thepensionsregulator.co.uk

VAT

Value Added Tax is levied on the sale of goods and services by UK businesses. It is collected on behalf of HMRC by companies and paid to HMRC as various intervals throughout the financial year.

A company can elect to register for VAT at any time but the threshold at which registration becomes compulsory is £90,000 in any 12 month period, and you must register within 30 days of exceeding this threshold.

For more information about registering for VAT visit www.gov.uk/vat-registration/overview

For more information about VAT rates visit www.gov.uk/vat-businesses/vat-rates

Making Tax Digital - What Does it Mean?

The aim is for everyone to have a digital tax account so that they can check what financial information HMRC holds about them and ensure it is correct and no information is missing Information will be able to be checked at any time and in real time. No longer will you have to wait until the end of the year or longer to know how much tax you need to pay. By making quarterly returns you will be able to see your ongoing liability and make the appropriate decisions according to this information.

Returns will be made directly to HMRC by digital record keeping software and returns can be made by individuals or by their agents. Advice and support will also be abailable from HMRC through webchat and secure messaging.

Why?

It is envisaged by HMRC that by reducing the number of reporting errors throught the year they will be able to close the gap between the amount of tax that is estimated to be due from individuals and companies and the amount that is currently received. This will also bring HMRC in line with other financial service providers. There are very few companies that exist today where you cannot log in online and receive an accurate update of your individual account.

Who Does it Apply To and When?

From 2026 Making Tax Digital will apply to self employed individuals and landlords with turnover above £30,000. Further information will be available shortly.

What Do You Have To Do?

If you and/or your business meet the qualifications for Making Tax Digital, you will need to ensure that your financial information can be uploaded to HMRC. Go to the HMRC website to find a list of providers of MTD compatible software. But why not get ahead of the deadline and speak to your local book keeper and they will be able to help you prepare. For further information go to www.gov.uk/makingtaxdigital

Statutory Payments and National Insurance

SSP – Statutory Sick Pay – payable to eligible employees at a rate of £116.75 per week for up to 28 weeks from April 2024 It is payable if an employee is sick for more than 4 consecutive days.

SMP - Statutory Maternity Pay - payable to eligible employees for up to 39 weeks. The first 6 weeks is paid at 90% of the employees average weekly wage. The remaining 33 weeks is paid at a rate of £184.03 or 90% if their average weekly wage whichever is the lower from April 2024.

SPP - Statutory Paternity Pay - payable to eligible employees at a rate of £184.03 per week or 90% of their weekly wage whichever is the lower from April 2024. It is payalbe for a maximum of two weeks. Shared partental leave is also available, check www.gov.uk for more details.

National Insurance rates are to decrease from April 2024.
Class 1 National Insurance for Employees fell to 10% in January 2024 and will fall again to 8% on earnings between £242.01 and £967 per week and 2% thereafter. For Employers the rate is 13.8%. This rate applies to category A contributions and may vary for other categories of contribution. See the link below for more details.
Class 4 National Insurance for the Self Employed will fall to 6% on profits between 12,570 and £50,270 and 2% over £50,270. Class 2 contributions are £3.45 per week.

For more information about eligibility for statutory payments or other information visit www.gov.uk/government/collections

National Living Wage and National Minimum Wage

From April 2024 the National Living Wage for those over 21 years of age will increase from £10.42 to £11.44 per hour.

Rates are also increasing for the National Minimum Wage.

Employees aged 21 and over will increase from £10.18 to £11.44 per hour.
Employees aged 18 - 20 increase from £7.49 to £8.60 per hour.
Employees aged 16 - 17 increase from £5.28 to £6.40 per hour.

Apprentices hourly rates increase from £5.28 to £6.40