Bank of England February 2016 Inflation Report Summary

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This report is courtesy of the Black Country Chamber of Commerce.

Bank of England February Report significant points:

  • There has been a softening of UK growth forecasts from 2.5% to 2.2%
  • Spare capacity in UK is 0.3% of GDP and unemployment is below 5%, which leaves little room for manoeuvre within the current downturn – this may lead to price pressure
  • A corporate cash balances are high (lessons learned from the recession) and because lending from the non-banking sector has grown, any issues within the financial sector are not expected to have a catastrophic effect on a globally resilient UK
  • Global growth outlooks are fuelling the 7% drop in equity; growth expectations amongst emerging economies have dropped significantly as a result of the drop in commodity prices (Less investment and bank lending tightening). Growth expectations in advanced economies has risen (where 75% of our exports go to)
  • Oversupply is the reason why the oil prices are dropping. Some commentators are expecting prices to drop to $10 a barrel
  • Productivity in the UK is rising but more business investment is required to consolidate

Click here to view the full Bank of England February 2016 Inflation Report.

We will continue to keep you updated with all of the latest financial and accounting news and hope that you have found our Bank of England February 2016 Inflation Report Summary useful.

Follow us on Twitter @OmnitasTax and like our Facebook page – we are happy to help with any queries that you may have.

If you require any tax or general accounting advice, feel free to call us on 01902 837 408 or you can request a free of charge call-back from our website.


Will UK Consumers Reject Technology in 2016?

Will UK Consumers Reject Technology in 2016?

I recently read a report – 2016 predictions – that UK consumers will increasingly reject tech in favour of a more traditional in the year ahead, creating new opportunity for businesses.

For Britons, 2016 will increasingly be about balancing the technological with the human element. We’ll continue to enjoy technology that gives us greater control over entertainment, purchasing, consumption, our work and personal lives.

We’ll use technology to learn; to sidestep traditional rules and behaviours and to speed up our lives using all the wearables, smart technology and internet led services that will be available in the year ahead.

But 2016 will see a growing reaction against the omnipresence of technology. More and more of us will want to balance our tech use with romance, relaxation, creativity, tradition, sensuality, rawness and honesty.

More and more of us will lose our “fear of missing out” and actually gain some pleasure from missing out. We’ll find time to switch off gadgets and seek out older, quieter, less urban environments in which to enjoy some ‘me time’. Or even take some tech-free we time with our closest friends and family.

More employers will embrace relaxation, digital detoxing and mindfulness.

The year ahead will see the “Slow Living” movement gain momentum, as more young people embrace old fashioned, inefficient ways to do things.

Many will start enjoying the traditionalist lifestyles and “Olde England” attitudes of village life and good neighbours, feeling a call of duty and encouraging others rather than making fun of them.

Reacting against the logic and ‘perfection’ of technology, some Britons will start championing flaws, randomness and a sense of danger. As with the trends we’ve seen in 2015, will all of the above have implications for business community?

Well maybe, but I think this is a utopian and perhaps unrealistic dream – technology will continue to be a massive part of our lives and our businesses and it’s up to us to stay in control: use it and don’t let it use us. How do you see 2016?

Will UK Consumers Reject Technology in 2016?

Written by: Andy Coleyshaw, Partner at Omni Tax & Accountancy Solutions Ltd


Tax relief restricted for many contractors from April 2016

Are HMRC digital tax accounts a good or bad thing?

HMRC has confirmed that people working through umbrella companies will no longer be able to claim tax relief on travel expenses.

Only those who can pass a test of being genuinely self-employed will be allowed to set these costs against expenditure in their accounts.

From April 2016, tax relief will be stopped if an individual is employed by an intermediary but is under the “supervision, direction and control” of an end user.

In addition, tax relief will be stopped if services are provided through a personal service company (PCS) and the engagement is caught by the Intermediaries Legislation (IRS35).

Once the definition and further guidance has been issued on the term, “supervision, direction and control” has been published by the HMRC, businesses will need to review the way they use temporary labour and all or any existing documentation that may be in-situ between them and employment intermediaries.

Contractors will need to take appropriate advice and make their decisions about which supply model to use.

Could you be affected by these new changes? Will your business have to take a look at how you manage your temporary labourers? Omni Chartered Accountants are here to provide advice and guidance and welcome any queries that you may have on this topic.

Tax relief restricted for many contractors from April 2016

You can request a free of charge call-back from our website www.taxandaccountancysolutions.co.uk or call us today for a chat about your circumstances on 01902 837 408 – we will be happy to help!

 


Are HMRC digital tax accounts a good or bad thing?

Are HMRC digital tax accounts a good or bad thing?

Taxpayers will start to be able to manage their tax affairs online with the formal launch of personal tax accounts by HM Revenue and Customs (HMRC).

By mid-December 2015, more than one million taxpayers completing their self-assessment will have been directed to their online personal tax account, HMRC has said.

These personal tax accounts, which will work in a similar way to online banking, promise to give people a “clear and joined-up view” of the tax they pay and enable them to update their tax details, supposedly removing the need to resubmit information.

Personal tax accounts

The launch of personal tax accounts is part of a drive towards a fully digital tax service. Two million businesses are already using their digital accounts and by April 2016, all of the UK’s five million small businesses will have access to their own digital account.

Every individual taxpayer will also have access to their own digital account by April 2016.

HMRC have said that by 2020 businesses and individual taxpayers will be able to register, file, pay and update their information at any time of the day, and at any point in the year, to suit them. For the vast majority, there will be no need to fill in an annual tax return. This will make it hugely important that you take the right advice from a professional or firm of Accountants.

At the moment, the information that HMRC receives from a range of sources is held on separate systems. This can mean taxpayers being asked to give information to the taxman that it already holds on another system.

The new digital tax accounts will join up the information HMRC holds in one place.

HMRC additional information and control

However some see it as not only being unable to cope but as an ulterior way of gleaning additional information and control.

One such quote from a tax blog;

“The real objective is to spy on your financial affairs 365 days a year and take what they think is the tax you owe directly from your bank account whenever they feel like it. After all these years, the present on-line system is a hopelessly unreliable mess.”

This may be an extreme view, but it is certain that the current systems and advice lines are struggling to cope with demand, wait times are increasing and historic legacy systems have not delivered as promised.

So, do you know what this means to you? Are you concerned, and if so by what?

Are HMRC digital tax accounts a good or bad thing?

Let us have your comments, views and concerns @OmnitasTax – we would love to hear your thoughts! Of course, if you require any tax or general accounting advice, feel free to call us on 01902 837 408 today!


2015 Autumn Statement from an SME perspective: Smoke and Mirrors?

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Mercurial Chancellor’s Autumn Statement treads fine line between smoke, mirrors and political sleight of hand.

 Chancellor George Osborne’s smiling face delivered a customary, skillful declaration of Government intent unveiling mouth-opening surprise in a ‘rabbits out of the hat’ delivery designed to trample over the critics of his financial and political aspirations.

 Determined to maintain his battle with Austerity the chancellor unveiled headline grabbing measures fuelled by a reduction of £8 billion in Government borrowing; robust growth forecasts for the next four years reducing Government debt as a share of GDP.

Opposition voices complained the ‘less generous’ Universal Credit benefit system introduced in stages between 2013 and 2017 but, as ever, the engine driving Treasury optimism is the performance of business, generating sufficient revenues to enable measures protecting front line budgets such as defence, policing, health and international aid.

 Yet small businesses continue to gnash their teeth about liquidity or rather the lack of it. Orders and production satisfactory, but getting paid?

 The old adage Cash is King never truer than today.

2015 Autumn Statement from an SME perspective: Smoke and Mirrors?


Timing bad debt relief

Timing bad debt relief, Accountancy advice, Accountant, accounting, accounting directive, accounts, affordable accounting, Blog, bookkeeping business, Businesses, business owners, chartered accountant, chartered accountants, companies house, company law, EU accounting, financial reporting, general election, HMRC, HMRC online system, HM Revenue & Customs, Income Tax, limited company structure, majority shareholder, minority shareholder, Omni, Omni Chartered Accountants, partnerships, PAYE, self-employed, self assessment, self employment, shareholder, agreement shareholder, rights small business, small business accountant, small business owners, small company accounts, SME, SMEs, tax, tax advice, tax affairs, tax return, VAT, Omni Chartered Accountants, Chartered Accountant Wolverhampton, Tax Advice Wolverhampton, Payroll Services Wolverhampton, CIS Accountant Wolverhampton, Accountant Wolverhampton Whatever accounting method your company uses, its profits have to be calculated on a “true and fair” basis.

That means including the value of invoices issued even where they won’t be paid until the following accounting period – or perhaps not at all. Accounting rules get around this apparent unfairness by allowing a deduction for the value of invoices you think won’t be paid i.e. Bad debts.

Bad debt relief

HMRC allows you to make a deduction from taxable profits for bad debts. However, it takes a tougher approach to it than accounting rules on what is classed as bad debt.

It isn’t just a case of estimating the value of debts you don’t expect to be paid, even if it’s a virtual certainty based on what’s happened historically; you have to carry out a review of each and every specific debt.

Chasing your debts

HMRC will expect you to have made a reasonable and proportioned effort to recover money you are owed.

This will be relevant to the amount of debt of course, e.g. if you are claiming a tax deduction for a £15,000. HMRC expects you to have been very thorough in your attempts to recover it, by using debt collection services for example, or taking court action.

Timing bad debt relief

You should claim relief for the accounting period in which you decide the debt has become irrecoverable.

If you suspect a debt may ‘go bad’, try to establish this in the same accounting period. This ensures that you won’t be taxed on unpaid bills. It is essential that you review your debts regularly – not just when the end of an accounting period is looming!

Post-accounting period

If the status of a debt you thought was bad at the end of your financial year changes, and before you sign your company’s accounts it is paid, HMRC will not accept a claim for bad debt relief.

This works both ways and if a good debt turns bad you can claim relief. Given this, it is well worth reviewing the debts during this period before signing and filing your accounts.

Seeking help

If you would like to talk about your bad debt situation, we would be delighted to hear from you – we are happy to provide expert advice that is totally free of charge. Simply request a call-back from our website, call on 01902 837 408 or click here to contact Omni Chartered Accounts.


HMRC Personal Tax Account

HMRC has taken the first step towards an automated tax assessment system by launchings its new Personal Tax Account

HMRC Personal Tax Account

It allows you to view your personal information, access HMRC’s tax forms and to estimate your PAYE bill; more functions will be added in the New Year.

HMRC New Website 2015

HMRC launched a test version in July of this year and it will soon be available to everyone who is taxed under the PAYE system.

Currently, it only allows you to:

  • View your personal details – name, NI number and address
  • Use HMRC’s Tax estimate Service, which tells you how much tax you’ll pay through PAYE, and to check the information your estimate is based upon
  • Use links to income tax related forms at GOV.UK

Keep an eye on the developments through the HMRC site and of course, our blogs. By following us om Twitter @OmnitasTax or liking our Facebook page, you will always be kept up to date with the latest tax and accountancy news!

HMRC Personal Tax Account

If you would like any advice regarding your tax affairs or would like to speak with us about our competitive accountancy services, call 01902 837 408 or click here and we will get back to you as soon as possible.


HMRC denies new business VAT refunds

HMRC denies new business VAT refundsHMRC has changed its interpretation of a key VAT rule – newly registered businesses are now being denied VAT refunds.

HMRC hasn’t publicly announced this change in practice, so tax advisers and taxpayers have been potentially over-claiming input VAT on new VAT registrations.

What’s changed?

When an established business registers for VAT, it may already hold some stock and assets which will be used after the registration date in connection with its ‘VATable’ sales.

For over 40 years, traders have been able to reclaim all the input VAT paid on those goods on their first VAT return, as long as the following conditions were met:

  • Goods were acquired in the four years before the date of registration
  • Items were still held at the date of registration

However, if you ring the VAT helpline you may now be told that you are unable to reclaim all of the input VAT paid on those goods.

HMRC says the input VAT should be reduced to take into account the use that has been made of the goods before the VAT registration date. There has been no change in practice for VAT reclaims on services, which must be provided in the six months before registration.

HMRC denies new business VAT refunds

If you would like to find out more information, or would like general business accounting advice, give Omni Chartered Accountants a call today! Our number is 01902 837408 or of you can request a free of charge call-back from our website!


Why Budget Tempers Optimism

Confidence among small businesses is cooling, according to the latest Federation of Small Business Index that was published in September.

Why Budget Tempers Optimism

While confidence levels remain firmly in positive territory, SMEs appear more cautious about their prospects than in recent quarters.

After an initial boost given by the clear outcome of the General Election, these results reflect the impact of recent changes announced at the Summer Budget, notably increased taxes on dividends and steep rises in the national living wage.

The number of businesses expecting to grow has also cooled but remains positive, with almost 6 in 10 small businesses (58.7%) anticipating expansion in the next 12 months.

Why Budget Tempers Optimism

How are you feeling about the future? If you need help or advice to ensure your business is as tax efficient that it can be, Omni Chartered Accountants can help!

Request a free of charge call back from our website or click here and we will get straight back to you!


5 top tips on managing your payroll

5 top tips on managing your payroll

5 top tips on managing your payroll

Payroll management is a specialist area, it is time consuming and difficult.

So it’s not surprising that few business owners like to do it themselves. If you’re currently considering outsourcing this service, here are a few benefits of doing so that should help you to make the right decision.

 

 

1. Cost

A large company can generally afford a big payroll department. If you’re a small business however, in-house payroll can be very costly. In general terms, if you have fewer than 20 employees, there’s a good chance that you can save a lot of money by outsourcing your payroll operations.

Simply work out your current costs and compare the amount to what an external provider will charge. Remember to factor in all associated expenses like printing, distributing cheques and creating tax documents.

2. Productivity

As mentioned earlier, payroll management is a time-consuming activity.

With this burden removed however, either you can save on employee costs or the employees can focus on doing more productive things that could, in turn, could help bring extra income to the business.

3. Specialist focus

If you outsource this service, you can seek financial restitution from the provider which is something you can’t do with your own employees.

4. Avoiding mistakes

An incorrect pay run can not only anger employees and cause conflict within the business, but a big mistake can have serious consequences with HMRC. Outsourcing your payroll management will avoid any such problems.

5. Knowledge

A good payroll provider will know all the relevant payroll-related tax laws and regulatory mandates. Of course it’s possible for your own employees to achieve this same level of understanding but it would take a considerable amount of investment in time and effort.

Omni Chartered Accountants Payroll Service – 5 top tips on managing your payroll

Omni provides a cost-effective payroll service for SMEs and larger businesses, from just £240 per person – request a free of charge call back from our website or call 01902 837 408 for an initial chat and quotation based on your requirements!