Accounting Issues Archives - Page 4 of 6

Accountants, Accounting, Accounting Issues

Everything You Need to Know About Account Aggregation!

George / 21/04/2022

If you are an accountant or related to accounting firms, these few minutes of reading are going to be beneficial in the real sense for you. As a beginner, you might wonder what is account aggregation? A simple put, if you intend to gather the financial data from the accounts that an individual owns and aim to display the data in one place. This is account aggregation. What Is Account Aggregation? You need to know that financial data aggregation and account aggregation refer to the same process in practice. As long as the aim is to gather all the data from single or multiple accounts owned by an individual to ensure clear visibility of their financial details. Here, we will discuss how account aggregation is beneficial for people as well as businesses with increased transparency. Moreover, there is no explanation needed that why it is always done with the content of the account’s owner. The factor of transparency over the view of the financial health of a business is increased by the process of account aggregation. A better view of finances will eventually lead to business growth like never before. To develop a better understanding, we have covered certain points of discussion in this article. This includes the following: Account Aggregation In Practice What Does Account Aggregation Offer to the Consumers and SMEs? Final Thoughts We’re not just in the market because we’re old, we’re qualified to do the job too. Get in touch now to get tailored services to satisfy your unique business needs. Account Aggregation In Practice One of the most efficient accounting products that offer multiple factors of technology ease is happen to be account aggregation. How it works and offers services in practice include the points listed below for you: Income Check Account Check Money Manager Transactions Income Check: It keeps a track of the real-time transactions related data. Which further ensures seamless verification of the data through these transaction details. Account Check: It has an access to the account details straight from the bank. So, it is a lot easier to confirm the account ownership in an error-free manner. Money Manager: There are many tools that offer personal money management. The factor of multi banking experience helps customers to have a transparent view of finances with a comprehensive view. Transactions: Easy access to the transaction is ensured to help the businesses. The financial data is organised in a clean and standardised format. Stuck with your accounts and looking for a helping hand? How about you get our guys on a quick call. We love talking about taxes, payroll management, and any opportunities that help you expand your prospects. Call us on 020 8686 8876 or email us today. What Does Account Aggregation Offer to the Consumers and SMEs? Let’s have a discussion of how is account aggregation beneficial from the following perspective: a consumer’s perspective the business perspective A Consumer’s Perspective: The major and prominent benefit that consumers believe to get out of account aggregation is the ability to view multiple accounts in one place. Mostly the people with the money that is spread in multiple accounts get the most out of it. These days, multiple accounts and spreading money is quite common as well. Let’s take the example of an individual who has a salary account (bank 1), an investment account (bank 2), and a mortgage account (bank 3). With the use of account aggregate, it is now possible for such an individual to have a complete view of his finances with a single app. In other cases, such people have to log in to multiple account apps to check the transaction and financial details. The hassle of which is time-consuming in today’s fast running world. The Business Perspective: The benefits are likely to be the same with the business perspective as well. The prominent of all is to have a comprehensive view of the aggregation of business accounts just by one app and its services. In case the funds are spread in multiple accounts, the hassle-free way of a complete financial overview is now possible through account aggregate. Moreover, the businesses are more inclined to provide on their own for the consumers. For example: Providing Aggregation Leveraging Aggregation Providing Aggregation: To keep the attention and engagement of the customers intact, providing accounts is the easy yet simple way. If we refer to the above-mentioned example of salary account, investment account and mortgage account. In case bank 2 with an investment account allows the details of all other accounts as well, the customer will be more inclined towards bank 2. Leveraging Aggregation: There are multiple businesses that get the benefits from the factor of increased transparency with the finances of the customers. Here we will take the example of the leading companies who will be able to make more from the accurate management once they have the increased transparency of the customer’s finances. Moreover, there are multiple other ways that will help once you have a complete understanding of an individual’s financial picture. Some of them include the following: Better experience in digital channels Time-saving Increased efficiency Final Thoughts Now that you have developed a better understanding of what is account aggregate, we can sum up the discussion by saying that it is an easy and simple way to seamless working on finances. Once you are able to gather all the financial dealings in one place, this will save you from the hassle of logging into multiple apps to keep a track of your finances. This will eventually make you more focused on business growth and add to your valuation. Coffee, cookies and taxes. What a perfect match. Get in the car, and reach our office today. Call us or email us to book your initial free one-hour basic consultation to discuss your requirements. We’ll make sure that we get all your documents are submitted on time. Talk to our guys today! Disclaimer: The information about

Accounting Issues, Sole Trader, Tax Issues

What is Payment on Account? A Simple Guide

George / 10/01/2022

As a UK taxpayer, if you’ve submitted your tax return, you can check out your self-assessment tax bill to know: what you owe to the HMRC? How you will pay that amount to HMRC? When you will pay it? To find out, you need to understand ‘Payment on Account’. If you have paid below 80% of your tax at source (like via PAYE) and your tax bill is over £1,000, HMRC may ask you for payment on accounts. Let’s learn: What is POA? How to calculate POA? What if your income is smaller or higher next year? How to check the amount you owe? Is POA optional? If you want a professional accountant and bookkeeper for your company, we can help you. Our bookkeepers and accountants at CruseBurke are qualified and cost-effective. We save your time, money, and stress by handling all your finances and business problems in no time. Contact us now! Understanding Payment on Accounts If you pay the tax bill via self-assessment, you may be required to make tax payments twice a year (two instalments) to spread the cost of the next year’s income tax, this system is known as payment on accounts. It is calculated based on your previous year’s tax bill and settles the tax you owed from the tax return. The amount you pay for each POA will be half of your previous year’s tax bill. POA means you pay tax in two instalments: In January (deadline to pay tax bill) And in July In case, if you have already paid over 80% of your tax bill in January, you don’t need to worry about POA as you will not be charged again in July. How to Calculate Payment on Accounts? POA is calculated based on the previous year’s tax bill about your future income. It will then be paid in equal instalments, so it means that the half payment will be made in January and half in July. Suppose if you have a £2,000 tax bill for this year, you’ll be paying POA in two instalments totalling £2,000 for the upcoming year’s tax bill. It assumes that you will make roughly the same income or more that you did last year. If you make the income more and your tax liability increase, in such case you just pay off the balancing amount on 31 January. What if Your Income is Smaller or Higher Next Year? If your income is smaller next year, you may contact HMRC to bring down your payment. You can do it through: HMRC online account and click on “Reduce Payments on Account” print and post the SA303 form to your HMRC However, it is recommended to pay the POA as it is. If HMRC found that your profits are down, the difference would be refunded by HMRC. In contrast, if your income is higher, you need to make a balancing payment by 31st January next year to update your account. We can register you as self-employed to HMRC on your behalf. Fill out this form and let us handle everything. Call us on 020 8686 8876 or email us today! How to Check what you Owe? To check it, you first need to sign in to your online account. Then, you need to click the view statement. There you will find: the payment you made before your next paments Is Payment on Account Compulsory for Self Assessment? POA is not optional rather it is mandatory, once you are done submitting your Self Assessment tax return, you’ll be automatically enrolled in it. You may not be enrolled if: you’ve already paid 80% over of the total tax amount you owe (like via PAYE) your tax bill from Self Assessment was under £1,000. Quick Sum Up We hope that after giving it a read, you have now got a basic understanding of what is payment on accounts, how to calculate it, what if your income is smaller or higher next year, how to check what you owe, is POA optional. Payment on account is the system to pay the tax bill in two instalments, first in January and second in July. Generally, self-employed make this payment as an additional self-assessment tax payment. Turn to us if you need any help with accounting, tax payroll, and other finance-related problems! We will solve you are all your business issues in no time and at an affordable price! So, contact us now! Get an instant quote from our accountants for the services you’re looking for! Disclaimer: This blog contains general information on POA.

Accounting, Accounting Issues, Business Growth Ideas

What is Bookkeeping and How it is Important for your Business?

George / 07/01/2022

You most probably have heard the term bookkeeping, but do you know what exactly it is. Even in the world of business, you might not be fully aware of what is bookkeeping, how does it work and why does it matter? Bookkeeping helps you with budgeting, preparing tax returns and keeping your business organised. It also affects your cash flow and overall finances. So, bookkeeping is essential for your business to keep track of your finances, otherwise, things may get tricky to handle. Therefore, you need to understand: What is bookkeeping? Why does it matter? How it is important for your business? What are good bookkeeping practices? If you want a professional accountant and bookkeeper for your company, we can help you. Our bookkeepers and accountants at CruseBurke are qualified and cost-effective. We save your time, money, and stress by handling all your finances and business problems in no time. Contact us now! What is Bookkeeping? Simply put, bookkeeping is the process of recording the financial transactions of the business on a regular basis. Transactions include sales or purchases, receipts or payments. It helps you to easily understand and track what money is coming into your business as earnings and what is going out as spending. Typically, it involves: Recording financial transactions Preparation of financial statements Bank reconciliation Posting debits and credits Producing invoices Handling payroll Maintaining and balancing historical accounts, general ledgers, and subsidiaries Why Does it Matter? Balancing your books or bookkeeping is essential to make key operating, and financing decisions. Without bookkeeping, a business would not know its current financial status as well as the transactions that occur. It is also important for external users like investors, financial bodies or government agencies. With bookkeeping, they can get access to reliable information to make investment or lending decisions. Once bookkeeping is completed, the records are passed on to the accountants to prepare financial accounts and file financial reports to HMRC and other agencies for tax returns and VAT. The basic way to record financial transactions is known as single-entry bookkeeping, while double-entry bookkeeping is more complex and sophisticated. Both bookkeepers and accountants use the financial records to prepare profit and loss statements to manage cash flow and to ascertain whether the company is making a profit. How Bookkeeping is Important for your Business? Bookkeeping is essential to carry out your financial tasks in an effective way. Whether you need to prepare your tax returns, want to keep your business organised or want to manage your cash flow, bookkeeping is crucial. You might fall into trouble if you don’t keep track of your finances. Here are the main benefits for which you need to do bookkeeping: Maintain organised reports Keep you prepared for taxes Help you to budget accurately Business analysis and decisions making Get you ready for the future Provide peace of mind Track business’s performance Help with financial management Improve cash flow Track profit and growth Provide a snapshot of your business Ensure regulatory compliance Stuck with your accounts and looking for a helping hand? How about you get our guys on a quick call. We love talking about books, accounts, taxes and payroll. Call us on 020 8686 8876 or email us today. What are the Good Bookkeeping Practices? Here are the good bookkeeping practices you need to consider: Keep all your receipts and invoices Start your bookkeeping early Keep business accounts separate from your personal ones Use debit or credit card to keep records Use digital bookkeeping software Keep your records updated Get Help From Our Bookkeepers! Now that you know what is bookkeeping and why does it matter. Remember that not everyone is an expert to manage the books of a business. A tiny mistake can cost you a hefty sum. To avoid these mistakes, allow us to do the books of your business accurately, get in touch with our bookkeepers and save your time, money and stress involved in recording and managing books. If you’re looking for someone who can provide your bookkeeping services in Croydon, to help your business succeed and attain a competitive edge, get in touch with us today to see how we can help! Get an instant quote from our accountants for the services you’re looking for! Disclaimer: This blog provides general guidance on what is bookkeeping.

Accounting, Accounting Issues, Limited Company, Sole Proprietorship

Self Employed or Limited Company: What’s the Difference?

George / 30/12/2021

While setting up your business, one of the most crucial decisions to make is to choose a business structure. There are a lot of business structures to choose from. Limited liability partnership is the less popular business structure used by professionals. The majority of the business structures in the UK are either self employed or limited company. According to the latest reports of Statista, there are around 4.3 million self-employed workers in the UK. On the other hand, there are over 4 million limited companies registered in the UK. Let’s dig deep into both to know what are they, are taxed the same, and what cost and administration is involved. Let’s kick off with what is self-employed and what is a limited company? We save your time, money, and stress by handling all your finances and business problems in no time! Call us on 020 8686 8876 or email us today. Self Employed or Limited Company: Differences Let’s have a quick glimpse at self-employed and limited companies. What is a Self Employment? Self-employed persons work for themselves as sole traders. There are no shareholders or officers and the self-employed person has total control over his business and is liable for all the profits and losses personally. The losses made by a sole trader directly impact the personal finances of a sole trader. Income tax is payable on the profit earned and needs to pay Class 2 and 4 National Insurance as a self-employed individual. What is a Limited Company? A limited company is a separate entity with its own identity and it is separate from shareholders and directors. The personal finances of directors of the limited company are kept separate from the company until there’s fraudulence or any breach. A limited company has to pay corporation tax on the taxable profit and they need to deduct income tax and NI from the employees’ salary through PAYE. Tax Implications Let’s see how self-employed persons and limited companies are taxed. Self Employed Tax Self-employed persons need to pay income tax through Self-Assessment. They need to register for VAT if reached the threshold of £85,000 (2021/22). Here are the tax rates and threshold that a self-employed person should know: Band Taxable income Tax rate Personal Allowance Up to £12,570 0% Basic rate £12,571 to £50,270 20% Higher rate £50,271 to £150,000 40% Additional rate over £150,000 45% The deadline for online tax return is Midnight 31 January 2022. Moreover, self-employed persons need to pay Class 2 National insurance if the profits are £6,515 or more a year and Class 4 NI on profits over £9,569. Here is the rate of NI rate you need to remember: Class Rate for tax year 2021 to 2022 Class 2 £3.05 a week Class 4 9% on profits between £9,569 and £50,270 2% on profits over £50,270 We can register you as self-employed to HMRC on your behalf! Fill out this form and let us handle everything! Limited Company Tax Instead of income tax, limited companies need to pay 19% Corporation tax on the annual profits. Company directors are levied tax based on the salary they earn from a limited company. Dividend tax is paid on dividends received from a company. In addition, income tax and Class 1 NI is payable on any salaries paid by the company. And companies need to pay Class 1 Employers’ NICs on salaries paid to employees. Want to incorporate a company? Get in touch with one of our professionals. Check out our company formation package! Administration and Costs A limited company needs more administration and management tasks compared to self-employed. Limited Company Administration All the limited companies of the UK need to register with Companies House. It must make sure to inform the registrar of companies informed of any changes made, need to file confirmation statement and PSC each year along with the company accounts. The cost of forming a limited company is affordable and the accountants are responsible to manage the accounting tasks along with dealing with HMRC and Companies House. Self Employed Requirements There are fewer legal responsibilities and administrative tasks in forming a limited company. You just need to register for self-assessment and pay the due tax and NI on time. Quick Sum Up So after giving this blog a read, you have now understood which business structure to choose: self employed or limited company. As a self-employed, you are your own boss and liable to pay tax and NI 2 & 4 on your earnings. Whereas, limited companies need to pay corporation tax and Class 1 NI on salaries paid to employees. Bear in mind that there is less hassle to work as a self-employed, but with limited companies, you have to meet administrative and legal responsibilities. Turn to us if you need any help with accounting, tax payroll, and other finance-related problems. We will solve your tax issues in no time and at an affordable price! So, contact us now! Disclaimer: This blog contains general information about the topic.

Accountants, Accounting, Accounting Issues, Startup accountants

How Much Does an Accountant Cost?

George / 15/11/2021

Wondering how much does an accountant cost in the UK? There is no fixed cost, it depends on a lot of factors. A fee of an accountant can differ based on the business’s nature, size, and turnover. It also varies as per the service and its scale. In addition, the charges of an accountant may be different as per the location, experience, and expertise of your accountant. After knowing these things, you can gauge the fee of your accountant easily. Let’s find out the average fees of an accountant as per the services! Talk to one of our chartered accountants in Croydon to know what they charge! Feel free to contact us! What Accounting Services Do Small Businesses Need? If you are a sole trader, contractor or a limited company with up to 50 employees or below, these are the typical accounting services that you might need: Bookkeeping Annual accounts Tax returns VAT returns Company Formation Preparing Financial Statements Preparing and Filing Business taxes Monthly & annual payroll returns Advice on tax avoidance legislation (IR35) Day-to-day advice from your accountant What services you are looking for? Let us know! We have a special offer for you. Get in touch now! Price Guide for Accountants Cost Here are the average fees of an accountant. However, these may vary based on multiple factors like your business size, the complexity of your finances, etc. The cost of an accountant as per the industry for the following services is: Individual tax return –£75 to £400+vat a year Self-employed tax return and accounts – £250 to £1,000+vat a year Limited company – £40 to £250+vat per month for accounts, tax returns and payroll How Much Does an Accountant Cost for Small Businesses? The services of an accountant vary based on the below-mentioned factors: The country you are based in Services you need Size and nature of your business For a small business (below 50 employees) looking for services like tax advice, bookkeeping, monthly and annual payroll, the average fee of an accountant can be anywhere between £60 to £250. Most self-employed people need an accountant for one-time service, like to do tax returns. There would be a one-off fee for it that will be around £150 to £400. Bear in mind that this is the average fee. This may vary as per your circumstances, complications and other factors. For additional services, the self-employed person needs to pay more. Self-employed people can save a lot of tax by hiring an accountant. So even after paying the fee of an accountant, you can save money. For VAT returns, this fee can be between £100-£250, and business accounts can range from £150-£700, as per the turnover of the business. Do Accountants Charge on an Hourly Basis? Some accountants charge on an hourly basis. An accountant who is offering basic accounting services will cost you around £25 and £35 per hour. If you need complex services like tax planning and business advice, the charges can go up to £125 to £150 per hour. Accounting Fees Per Service Some businesses pay accountants based on the services they want. It may include year-end accounts, VAT returns or payroll etc. Here is the one-time fee for the following services: Doing accounts of a business with a turnover of £20,000 to £30,000, the cost will be around £150 (businesses with high turnover need to pay more) The typical fee for payroll services with 50 employees can be £200 (per month) A business, having a £100,000 turnover, looking for VAT returns will pay, typically, around £100 (the fee will be higher as per the turnover) Quick Sum Up So you have now got a fair idea of how much does an accountant costs in the UK. Bear in mind that the accountant’s fee varies based on multiple factors. But as a general rule of thumb, the higher your turnover or income, the greater your accounting fee is likely to be. Remember that the charges mentioned in this blog are just for your general guidance. You may talk to our accountants to discuss the fee, they charge. Moreover, you can minimise your accounting fee by maintaining your records and by using accounting software. At CruseBurke, we have a team of skilled accountants who provide solutions to all your business problems! Reach out to us today! Get an instant quote from our accountants for the services you’re looking for! Disclaimer: This blog provides general guidance on the cost of hiring an accountant.

Accounting Issues

What is Bank Reconciliation and How to Do it?

George / 07/06/2021

In this digital banking system, many people overlook the importance of bank reconciliation. However, you need to remember that banks can also make mistakes. To find those mistakes, bank reconciliation is needed. So let’s explore what is bank reconciliation and how to do it? Bank reconciliation means matching the balances of your bank statement to your accounting records. This process helps us to correct errors, identify fraudulence, and locate missing funds. Though connecting an accounting software with the bank is a great option to boost the reconciliation process. However, this process is not parallel to do bank reconciliation each month. In this blog, we’ll explain what is bank reconciliation, why it is important, and what are the steps to do it. What is Bank Reconciliation? It is the process of comparing your bank statement and your general ledger account in balance. You need to know that the transition of cash and bank accounts in your general ledger should show the same activity that is in the bank statement. In case if they are not matched, you need to find out the missing entries from the balances of the bank statement and general ledger. Then, reconcile them both. So now that you know what is bank reconciliation. Let’s see how to do it. Need an efficient bookkeeper to record and manage your business transactions. Get in touch with us for the best bookkeeping services you are looking for! Step by Step Bank Reconciliation Process It is done for verifying the accounting records of the bank and the business. You can follow these steps for bank reconciliation: 1) Get Bank and Business Records You need to have a detailed list of transaction made by the bank through a bank statement, you can get it online or by your accounting software. Besides, you need to get your ledger account of your business outgoings and incomings. You can also get it from a spreadsheet, a logbook or accounting software. 2) Find a Point to Start Find and compare the last time balance of your business books with the balance of your bank account. And begin reconciliation. 3) Go through your Bank Deposits and Withdrawal Make sure all of your banking transactions are accurately recorded in your bank statement. Add the missing entries and categorize them into interest, sale, refund etc. 4) Go through the Expenses and Income on your Books Check and match the entries of your books with the bank statement. If something is missing find it out. It can be something that you forget to account on your book or it can be a payment that is yet to be cleared. 5) Check the Bank Statement Sometimes, bank statement doesn’t show the accurate records as per the business’s transactions. You might face troubles with bank errors or deposit, outstanding checks. So, you should do the changes to the bank statement. 6) Check the Cash Balance You need to check and correct your business records accurately to match with the bank statement. You need to ensure that you have recorded all charges and deposits are in the cash account of the business. 7) Match the End Balances After comparing and adjusting the entries, you need to make sure that your bank balance is matching your business accounts. If they are equal, it means the reconciliation process has completed. if not, you need to record the process again. If you’re busy with your business, save your time and energy by letting us know. Feel free to contact us! Why Bank Reconciliation Is Important It is used for multiple purposes. Here are some of the important advantages of bank reconciliation. It is used: To accurately record the transactions To detect fraud To prevent administrative errors To find out the delayed payments To know the actual position of the bank balance Quick Sum Up: To sum up, we have discussed what is bank reconciliation, how to do it and why it is important. It used to be tough a decade ago but nowadays you can easily do bank reconciliation using accounting software that makes it faster and error-free. You can automatically import the bank transactions and can match and categorize transactions with a click of a button. However, if you are totally new to it or you are running a large business, it might be complex for you. Don’t worry, just contact us for affordable bookkeeping services. We have a team of expert bookkeepers and accountants for your help. Feel free to reach out and get an instant quote right away. Disclaimer: This blog is intended for general information on bank reconciliation.

Accounting Issues, tax

Things you Need to Know about Research and Development Tax Relief

George / 22/03/2021

Research and Development (R&D) Tax Relief is initiated by various governments (including the UK) to encourage and support companies to develop and research for long-term economic growth. Along with the public sector, the private sector is also receiving benefits from this relief. Let’s explore, how it can be beneficial for your business. We’ll be discussing the following points in this blog: What is research and development tax relief? Who qualifies for R&D tax relief? Advancements Proof of uncertainties and unsuccessful advances Type of R&D You can avail of tax relief against the cost of R&D stated in Part 13 of the Corporation Tax Act 2009 which provides a range of tax deductions and credits for qualifying costs. You may reach out to us to discuss whether you qualify for this relief or not! What is Research and Development Tax Relief? Research and development tax reliefs ensure to aid businesses who are working on innovative projects in science and technology. Companies that are struggling to research and develop an advance in their field are encouraged to apply for this relief. Even, companies that are unsuccessful in their technological endeavours can also apply for this allowance. Companies can claim Corporation tax relief if a project fulfils the requirement of R&D as per HMRC. Who Qualifies for R&D Tax Relief? To be qualified for R&D, a project should be aimed to achieve advancement in science and technology. The research and advancement in social sciences (Like economics, or pure maths) do not qualify for R&D tax relief. Additionally, the project in which you are making an advancement must be related to your existing business or the one you are willing to start after getting the data from R&D. To qualify for R&D relief, you must make sure to explain how your project: shows the advancement in science and technology. had to control the uncertainties have worked to get over those uncertainties was unable to be carried out by professionals The research project should be aimed at enhancing a new process, service, or item or can improve something that already existed. Advancements: The project you are claiming for R&D relief must be beneficial for the overall field, not just for your own business. This implies that any technology used in your sector for the first time cannot be called an advance for R&D. If an advance by another company in a service, product, or process that is not publicly acknowledged or available, is also accepted for this relief. Proof of Uncertainties and Unsuccessful Advances: A scientific uncertainty means a field professional claims that something is not possible technologically. It also refers to the question of possibility even after getting the required evidence. It means that experts in your field are unaware of advancement or its procedure. Your company should show that a project has been accomplished after overcoming uncertainties through analysis, research, and testing. As evidence, you can show the project details depicting failures and successes during the project. Types of R & D: R & D relief has two types. These types differ based on the size of a company and whether the project is outsourced to you or not. R&D Relief for Small and Medium-sized Enterprises (SME): This relief is for you if: You are running a small or medium-scale business with fewer than 500 employees. Your turnover is less than €100m and your total balance sheet is below €86m. You may be required to mention linked companies and partnerships if you’re an SME. This relief provides companies to: Claim tax credit of 14.5% in case of surrenderable loss. Research and Development Expenditure Credit (RDEC): Large companies can request RDEC for the cost occurring in R&D projects. The works subcontracted by SMEs or RDECs from large companies can also claim this credit. It is a tax credit that has been increased to 20% on 1 April 2024 and onward. Quick Wrap-up: So, if your company is investing in R&D, it is worth spending. There are a lot of incentives and support given by the UK government for companies who want to accelerate in the field of research and development. Ultimately, this relief can help to transform your business. If you’re looking for further support regarding R&D tax claims, we’d love to know more about your business to provide the right solution. You may contact us now! Disclaimer: The information about the R&D tax relief provided in this blog includes text and graphics of general nature. It does not intend to disregard any of the professional advice.

Accountants, Accounting Issues, Business Growth Ideas

Find Out How Does Tax Affect a Business?

George / 11/03/2021

How Does Tax Affect a Business? Taxes may affect your business on a sectoral basis and government legislation. Whichever sector you are working in, you should make sure to know about your tax obligations. There are various ways to reduce tax costs. In this blog, we are going to discuss how does tax affect a business? If you are an employee, your taxes are automatically deducted from your gross salary. However, if you’re a business owner, it is imperative to pay taxes levied on you by the state. Key Business Taxes to Pay: Environmental taxes affect almost all businesses but have a major impact on those businesses which are directly involved with them. These include power companies, airlines, quarries, landfill operators, and aggregate importers. The businesses dealing with alcohol, tobacco, oils, and gambling have to pay excise duty. Likewise, those businesses who are related to import and export may also be affected by excise duty or customs duty. Similarly, financial taxes affect banks and financial institutions. The taxes may vary in accordance with their responsibility and size. In addition, insurers and insurance companies have to register and pay insurance premium tax. Do Businesses pay Tax? If your company is making a profit, a corporate tax or business tax is levied on it. It works the same as income tax, but it is only for businesses who start making profits and they have to pay a business tax at a certain rate. Business tax affects your business cost. If your corporation tax is rising, it means that your total cost is increasing simultaneously. It can cause price hikes within the business. Does Interest Rate Affect Business? In the UK, the Monetary Policy Committee works under government supervision to determine the level of interest rates. The rise in interest rate could increase the cost of businesses’ borrowed money. Consequently, the buying power of consumers declines which lead to a fall in business sales. The government’s spending priorities also affect businesses. So, if a government spends money on schools, the subsidiary industries related to schools will start growing and earning. In addition, the government also provides subsidies for companies. For instance, the government provides employment subsidies to reduce unemployment. These subsidies encourage businesses to grow. Understanding Taxes in your Sector: For a general understanding, if you’re a UK citizen you can visit the HMRC website or your respective government’s site to know the tax implications related to your sector. However, your accountant would be the best source for understanding taxes in your sector. As accountants, working on taxation, are well-versed with sectoral tax issues and other legal obligations related to it. There are other sources too, as local business support organizations and trade associations, though they are not as expert as accountants. Conclusion: We do hope that you have understood how does tax affect a business? If you are looking for the professional services of an accountant to solve your taxation issues, Cruseburke is here for your help. We’re an accountancy firm in London working for the financial growth of individuals, contractors, businesses, and landowners. You can leave your query here!

Accounting Issues, Tax Issues

The Role of the Adjudicator’s Office

George / 02/03/2021

The Adjudicator’s Office (AO) was established in 1993 to provide independent oversight of complaints about HMRC and the Valuation Office Agency (VOA). Since December 2019, its remit has extended to reviewing decisions under the Home Office’s Windrush Compensation Scheme. AO’s Purpose and Limitations The AO does not overturn departmental decisions. Instead, it assesses whether HMRC, VOA, or the Home Office: Handled complaints appropriately and in line with policy Acted with fairness, consistency, and transparency It can only investigate complaints received within six months of the department’s final response. Types of Complaints Covered The AO investigates the following issues: Mistakes or errors Unreasonable delays Misleading or poor advice Inappropriate staff behavior Inconsistent use of discretion Before an AO review, a complaint must go through two internal stages of review by the relevant department. Latest Performance Data (2023–24) According to the AO’s 2023–24 Annual Report: Total complaints received about HMRC rose to 1,046 (from 950 in 2022–23). Complaints about the VOA stayed steady at around 58. HMRC complaint cases closed increased by 34%, totaling 843. Complaints fully or partially upheld were 41%, a slight drop from 47% in 2022–23. Case resolution times: 82% closed within 4 months in 2023–24 Dropped to 76% in 2024–25 with 1,667 of 2,181 cases resolved on time. Compensation Awarded The AO continues to recommend compensation for: Financial loss Anxiety or distress However, payouts remain modest. Specific figures have not been disclosed in the 2023–24 report. As of 2019–20, the highest awarded was around £13,896, which illustrates the typically limited financial remedies. AO’s Emerging Insight and Feedback Service delays remain a significant concern in the 2023–24 cycle, particularly with HMRC’s phone and post service performance. The AO published a Level‑3 insight report (“Applying Customer Circumstances to Decision Making”) aimed at improving how HMRC considers vulnerable individuals in its processes. An ongoing Complaints Insight Board helps to identify strategic improvements across departments.

Accounting Issues, Tax Issues

Why is record keeping important?

George / 16/02/2021

Why is record keeping important? Imagine that one day you decide to file your taxes, and don’t find anything in your records. That’s the worst thing anyone can think of. What if you lose your tax records, and what help can you expect from HMRC in this regard. HMRC may check all the details to make sure you’re paying the right amount of tax. Let’s dig up more scenarios that deal with record keeping, and answer your question ‘why is record keeping important’ in the best possible way. What Happens if your Returns Get Late? What to do if your returns are late? If you’re sending your returns 4 years after the deadline, you need to keep your records for 15 months after you’ve sent in your return. What Action Will HMRC Take if your Records are Stolen or Destroyed If it’s not possible for you to replace your records, you must do every effort to provide relevant figures. Make sure you’re telling HMRC that you file your tax return if you’re using: You give your best guess to HMRC. What are your temporary estimated figures when you’re waiting for the exact ones? If there are any chances that you might get your records back, you need to mention the probability. In case, you don’t find your records, your best guess will do the job. Let’s Dig Into Record Keeping So one question everyone asks is what records do you need to keep? These records include: All income coming in from your sales. The expenses incurred in your business. VAT records if you’ve registered for VAT. PAYE records if you’re employing people. Further details of your personal income. The grant you’ve already claimed through the self-employed income support scheme. We hope we’re pretty clear about what happens when you’re losing your tax records, what happens if your returns get late and why is record keeping important? Disclaimer: The information about why record keeping is important provided in this blog includes text and graphics of general nature. It does not intend to disregard any of the professional advice.