Monday, 10 September 2012

New CIS guidance issued

HM Revenue & Customs (HMRC) has issued updated guidance for subcontractors operating as limited companies on reclaiming any deductions taken from their payments under the Construction Industry Scheme.

Firms ‘at risk on insurance cover’

New research has shown that more than a third of UK small or medium enterprises (SMEs) could be putting their business at risk by failing to insure their key staff.

The latest RSM Tenon Business Barometer, a quarterly survey carried out by YouGov amongst senior management in SMEs, found that 42 per cent had failed to insure key staff.

Retailers hit by £205m e-crime bill

A pioneering study of e-crime has revealed that e-crime cost UK retailers at least £205.4 million in 2011-2012.

The first e-crime study from the British Retail Consortium, published on 22 August, found that the bill included £77.3 million in losses from frauds themselves as well as prevention costs and legitimate business lost as a result of those measures.

Keep HMRC informed, warns business group

An organisation representing small businesses has warned entrepreneurs to fully update HM Revenue & Customs (HMRC) about any changes to their operations, following a report that one firm is facing a £10,000 fine for not telling HMRC it had changed its name.

The Forum of Private Business revealed on 9 August that the firm, which did not want to be identified but which has always made VAT payments and submitted tax returns on time, was originally hit with a fine of more than £30,000 under VAT notification liabilities contained in the Finance Act 1985 and the VAT Act 1994.

The fine was imposed after the business changed from a partnership to a limited company – adding a ‘ltd' to its name – without informing HMRC, even though it retained its old VAT number and HMRC received all the tax due.

The fine has been reduced to just over £10,000 after intervention by accountants and the forum’s tax adviser Andrew Needham, with work continuing to further reduce the penalty.
Mr Needham said: “I am concerned that this is a change in HMRC's long-standing policy of waiving its technical ability to impose this penalty fine in such circumstances.

"If this is carried through and sets a precedent it could result in huge fines being imposed on small businesses which, in reality, have done very little wrong.

"It is important that all small businesses are aware they could face steep fines unless HMRC is kept fully updated – but this heavy-handed approach is the very opposite of the support that is 
desperately needed at this difficult time."

Mr Needham highlighted a House of Commons debate in July 1986 on the legal clause to protect small traders making innocent mistakes from recently introduced fixed VAT penalties, a clause which was subsequently included in the legislation.

The forum is urging all small business owners to contact its Public Affairs team about their experiences of HMRC – including if they have received fines they feel are unfair or disproportionate. They can contact the forum at 01565 626016 or email

If you want more information then please contact accountants in Lichfield.

Contractors ‘could cut SME tax bills by £2bn’

Businesses could slash their tax bills by up to £2 billion by using self-employed contractors, according to professional advice website

1 in 3 businesses not aware of RTI, research finds

One-third of small businesses are not aware of Real Time Information (RTI) and how it will affect their PAYE systems, according to new research.

Business software specialist Sage surveyed 1,100 UK SMEs and found that 64 per cent were aware of the changes that will come into effect in April 2013. However, only one in ten questioned thought that RTI would be good for their business.

Taxpayers count £1,200 cost of failing to file returns

Around half a million people who have not yet submitted 2010/11 tax returns to HM Revenue & Customs (HMRC) are now receiving additional penalty letters.

The number of outstanding returns almost halved in 2012, falling to 5.9 per cent of those due compared to 10.7 per cent in 2011. As a result, 518,000 fewer penalties are being issued.

Tuesday, 10 July 2012

‘Good compliance’ the priority on cookies law, says regulator

Businesses and other organisations operating websites have been told that regulators want “good compliance, not rushed compliance” with a law requiring them to gain visitors’ consent before logging information about them. 

Last year, the government revised the Privacy and Electronic Communications Regulations to address new EU requirements, and these came into force on 26 May 2011. The UK’s Information Commissioner’s Office (ICO) allowed businesses and other organisations a year-long period to work towards compliance with changes, which ended on 26 May.

UK to get world-class creative tax breaks

The UK’s creative industries are set to benefit from tax reliefs that are among the most generous in the world, according to the government.

It has published a consultation on measures announced in the 2012 Budget, introducing tax reliefs targeted at animation, high-end TV and video games production.

Rules on large redundancies set for shake-up

Proposals that could cut the length of time employers have to consult with their employees on large scale redundancies by up to a third have been published by the government.

The new measures, outlined in a consultation launched by Employment Relations Minister Norman Lamb on 21 June, are designed to improve the ability of companies to respond to changing economic conditions and the quality of the collective redundancies process.

Anti-abuse tax rules set to include IHT

Inheritance tax (IHT) is set to be included in new anti-abuse rules designed to tackle tax avoidance schemes.

The government launched a consultation on the proposed General Anti-Avoidance Rule (GAAR) on 12 June, which would apply to the main direct taxes and national insurance. It also proposes an extension of the rule to inheritance tax.

Tuesday, 12 June 2012

UK firms must prepare for eurozone crisis, say accountants

A leading accountancy organisation has warned that the majority of UK businesses have no contingency plans in place in response to the economic turmoil in the eurozone.

Monday, 11 June 2012

New IR35 guidance comes under fire

New HM Revenue & Customs (HMRC) guidance to clarify the risk of contractors being caught by the IR35 intermediaries legislation has been attacked as a missed opportunity. 

Justice reforms good for business, says minister

Justice Minister Jonathan Djanogly has highlighted how the government is helping businesses to “get on with the job” by reforming the justice system.

Monday, 14 May 2012

Apps aid record-keeping on the go

HM Revenue & Customs (HMRC) has highlighted the availability of mobile apps that can help small businesses with record keeping on the go.

Commercial software businesses, following consultation with HMRC, have developed the apps for businesses below the VAT threshold.

HMRC said: “These applications may help with maintaining good records and include links to HMRC guidance related to record keeping. The majority of these applications are free.”

It has now published a list of companies providing apps for record keeping that meet HMRC specifications, although it stressed it had not tested any of the apps or carried out any security testing on these.

HMRC added: “This list is not exhaustive and it is probable that other software houses associated with mobile application development will also be developing applications.

The list, published on 16 April, will be updated as necessary on a regular basis.

If you want more information then please contact accountants in Lichfield.

Link: HMRC  companies providing record-keeping apps

Businesses urged to step up IT security

A new survey says that IT security breaches are costing the UK economy billions of pounds a year.

A total of 447 businesses were quizzed for the 2012 Information Security Breaches Survey (ISBS), carried out by PwC in conjunction with Infosecurity Europe and supported by the Department for Business, Innovation and Skills. Key findings of the survey, released on 24 April, included:
  • 93 per centof large organisations and 76 per centof small businesses had suffered a security breach in the last year
  • one in seven large organisations had been hacked in the last year, the highest level recorded since the survey began in the early 1990s
  • on average, each large organisation suffered 54 significant attacks over the year. Small businesses experienced an average of one attack a month
  • the average cost of a large organisation’s worst security breach of the year was £110,000-£250,000 and £15,000-£30,0000 for a small business.
  • on average, organisations spend eight per cent of their IT budget on information security but 20 per cent spend less than one per cent.
Chris Potter, PwC information security partner, said: “The cost to UK plc of security breaches is running into billions every year. Large organisations are more visible to attackers, which increases the likelihood of an attack. However, it is also true that small businesses tend to have less mature controls, and so may not detect the more sophisticated attacks.”

Universities and Science Minister David Willetts, whose responsibilities include cyber security issues, said the government was investing £650 million to improve cyber security. He added: "The UK is a world leader in doing business online. This survey is a timely reminder for UK businesses to make sure their information systems are protected.”

Meanwhile, the Information Commissioner’s Office (ICO) has published new guidance on securely deleting information from old computer storage devices. 

At the ICO’s request, computer forensics company NCC Group sourced around 200 hard drives, 20 memory sticks and 10 mobile phones, buying them mainly online from internet auction sites and some from computer trade fairs. 

When searched, a total of 34,000 files containing personal or corporate information were recovered. At least two hard drives contained enough information to enable someone to steal the former owner’s identity and four others contained information about the employees and clients of four organisations, including health and financial details. 

Information Commissioner Christopher Graham said: “People are in danger of becoming a soft touch for online fraudsters simply because organisations and individuals are failing to ensure the secure deletion of the data held on their old storage devices.”

The ICO guidance, published on 25 April, is designed to help individuals securely delete information. It will publish more detailed guidance for organisations shortly. 

If you want more information then please contact accountants in Lichfield.

Mental ill health ‘costs 91m lost work days’

Employment relations specialist Acas has launched a new guide to tackle what it describes as the last taboo in business - mental illness at work.

According to the Centre for Mental Health charity, a total of 91 million work days are lost to mental ill health every year although the lost days account for only half the £30 billion annual cost of reduced productivity. The remainder are due to employees coming to work when unwell and not performing at their best.

Acas chief executive John Taylor said: “Many employers and managers shy away from dealing with mental illness at work because it can be hard to pin down and it is a very sensitive matter to deal with.

"But we all need to develop a new way of looking at mental health and break down the taboo. There needs to be a willingness to discuss mental health and a culture where employers understand it and try to help their employees recover from mental illness.

"Our mental well-being is as much a part of health as our physical health. And we need to take into consideration that one in four of us will suffer a mental health problem at some point in our lives."
Advice for employers in managers in the Acas guide includes how to:
  • spot early the signs of mental ill health
  • raise awareness of mental health issues among managers and staff
  • approach an employee who may have a mental health condition
  • try to help them cope with it or overcome it so they can work effectively again.
Mr Taylor said employers and managers could help by identifying aspects of working life they can assist with, such as workloads, communication, bullying and strategies for the employee to cope at work.

He added: "There can be circumstances outside an employer's control, such as childhood experiences, family relationships, addiction problems and bereavement. However, an employer, by creating a supportive environment at work where people feel able to disclose their problems, can help them address their issues and remain productive at work.

"Also, there may be times when an employer will need to refer an employee to outside, specialist sources for help and advice."
Acas has compiled the guide with NHS agency Workways, which specialises in advising on dealing with mental ill-health at work.

If you want more information then please contact accountants in Lichfield.

£40m boost for hi-tech businesses

UK hi-tech small and medium-sized enterprises with high growth potential are set to benefit from at least £40 million of investment from a new Enterprise Capital Fund. 

Notion Capital, which is backed by private investors, the government and the European Investment Fund, will target businesses delivering internet-based services, including  cloud computing and software as a service (SaaS) companies. 

Launching the fund on 17 April, Business and Enterprise Minister Mark Prisk said: “It is absolutely vital that ambitious small firms can access the finance they need to expand and grow, and this new Enterprise Capital Fund will provide at least £40 million of funding to viable UK high-tech businesses.”

Enterprise Capital Funds use government funding alongside private sector investment to address the equity gap that arises where businesses with viable investment propositions cannot attract investment from informal investors or venture capitalists. 

Notion Capital, which has a pan-European focus, will invest at least £40 million in the UK. The government has committed a total of £200 million to the Enterprise Capital Fund programme in the four years up until 2014/15.

If you want more information then please contact accountants in Lichfield.

E-traders urged to set tax records straight

People trading on the internet who haven’t paid all the tax they owe are being invited to come forward and pay up under a new HM Revenue & Customs (HMRC) campaign.

The e-Markets Disclosure Facility will allow online marketplace traders to pay the tax they owe and benefit from lower penalties, rather than waiting for HMRC to catch up with them. 

Online marketplace traders have until 14 June to tell HMRC that they want to make a voluntary tax disclosure. They then have until 14 September to tell HMRC about tax due and make arrangements to pay any tax interest and penalties they owe.

If they make a full disclosure of what they owe before 14 September, some e-traders will receive no penalty at all. Most will receive a penalty of no more than ten per cent of the tax owed.

After that date, using information collated from different data sources, HMRC will investigate those who have failed to respond. Those who are found to have unpaid tax liabilities will face higher penalties of up to 100 per cent of the tax unpaid or, potentially, criminal prosecution.

Marian Wilson, head of HMRC Campaigns, said the initiative people using online marketplaces to buy and sell goods as a trade or business and who fail to pay the tax owed.

She added: “Those who only sell a few items and who are not traders are unlikely to be liable to pay tax on what they sell and will not be targeted by this campaign.

“Our aim is to make it easy for online traders to contact us and make a full disclosure of income, thereby putting their affairs in order.”
More than £500 million has been raised by HMRC from voluntary disclosures, and a further £105 million from follow-up activity. Previous campaigns have targeted offshore investments, medical professionals, plumbers and VAT defaulters.

A YouTube video is available giving guidance to people wondering whether their buying and selling on an e-marketplace website can be seen as trading can be viewed at:

If you want more information then please contact accountants in Lichfield.

Panel targets ‘daft’ health and safety decisions

Office workers being banned from putting up Christmas decorations and trapeze artists being told to wear hard hats are among a top ten of myths published as part of the launch of a new service to help curb the worst examples of health and safety misuse. 

The Health and Safety Executive (HSE) will run the Myth Busters Challenge Panel, which will provide quick advice to businesses and individuals querying the validity of health and safety decisions. 

The panel, which was launched on 11 April, will separate decisions that genuinely protect people from real risks from those not required in health and safety law. The panel will be supported by a pool of independent members representing a wide range of interests, including those of small businesses. 

Minister for Employment Chris Grayling said: “All too often, jobsworths are the real reason for daft health and safety decisions. 
“Common sense is the key to successful health and safety. The Myth Busters Challenge Panel will advise people where they think local authorities, insurance companies or schools have got it wrong.

Judith Hackitt, chair of the HSE and the new panel, said: “Over the years we’ve seen health and safety invoked – wrongly – in defence of some pretty absurd decisions.”

She said that such decisions undermined confidence in the real task of health and safety, which is to manage serious risks to life and limb in Britain’s workplaces. 

The HSE’s top ten health and safety myths are listed below.
  1. Children cannot play conkers unless they wear goggles.
  2. Office workers banned from putting up Christmas decorations.
  3. Trapeze artists told to wear hard hats.
  4. Pin the tail on the donkey games deemed a health and safety risk.
  5. Candy floss on a stick banned in case people trip and impale themselves.
  6. Hanging baskets banned in case people bump their heads on them.
  7. Schoolchildren ordered to wear clip on ties in case they are choked by traditional neckwear.
  8. Park benches must be replaced because they are three inches too low.
  9. Flip flops banned from the workplace.
  10. Graduates ordered not to throw their mortar boards in the air.
If you want more information then please contact accountants in Lichfield.

First-time employers get online help

A new online toolkit has been launched to give first-time employers a step-by-step guide to their obligations when taking on a member of staff. 

Taking on an Employee, which is available on the Business Link website, takes employers through the process of hiring their first member of staff and explains their legal responsibilities on issues including pay, tax and checking a new employee’s right to work in the UK in doing so.

Launching the toolkit on 25 April, Employment Relations Minister Norman Lamb said:  “For many one-person businesses there is a belief that the process for taking on their first member of staff can be a daunting and overly complicated process.  The Taking on an Employee toolkit aims to tackle this problem and will help empower our sole traders, our one-person businesses, to take that next step.

“If we can provide the advice and information in a simple format, showing first-time employers that taking on staff can be a simple process, this will ultimately help in our efforts in creating jobs and encouraging growth.”

John Walker, chairman of the Federation of Small Businesses (FSB), said:  “Taking on an employee can be a daunting, expensive and risky process and 13 per cent of FSB members have said one-to-one support would help them take on staff. Having a one-stop-shop to get quick access to all the information needed to recruit will help firms that want to grow.”

A myth busters document has been published alongside the online toolkit that aims to address some common misconceptions about hiring a member of staff. It includes helpful advice on registering with HM Revenue & Customs, anti-discrimination laws, dismissal rules, setting up payrolls and probation periods. 

Also available from the site will be information about Government support, financial and otherwise, to encourage employers to take on their first employee.

If you want more information then please contact accountants in Lichfield.

Forced retirement appeal fails

A Supreme Court ruling in a key direct age discrimination case is a reminder to employers that a worker’s age should not be “shorthand” on which to base their ability to do their job, says the Equality and Human Rights Commission (EHRC).

In the ruling, delivered on 25 April, the court dismissed an appeal by solicitor Leslie Seldon, a partner in the Kent law firm of Clarkson, Wright and Jakes, who was forced to retire when he reached the age of 65 in 2006. 

At the time, the default retirement age (DRA) of 65 still existed – it was scrapped in October 2011 – but as a partner rather than an employee, this did not apply to Mr Seldon. However, 65 had been agreed in the firm’s partnership agreement as the mandatory retirement age. 

Mr Seldon – now 71 and still working as a notary – took his case to an Employment Tribunal, the Employment Appeal Tribunal and the Court of Appeal and, after losing in all three, to the Supreme Court.

The Supreme Court ruled that the retiring of partners enabled the firm to retain younger solicitors who might otherwise go elsewhere by opening up partnership opportunities and was a “legitimate” aim of the partnership.

However, the court sent the case back to the Employment Tribunal “to consider whether the choice of a mandatory age of 65 was a proportionate means of achieving the legitimate aims of the partnership”. 

John Wadham from the EHRC, which is funding and running Mr Seldon’s case, said it was a reminder to employers “that a worker’s age is not shorthand for their competence and should never be used in that way”.

He added: “Every employer must think carefully about whether it really needs to have a policy that directly or indirectly discriminates against people based on their age. The court has made it clear that such policies must be justified on a case by case basis.”

Barrister Caspar Glyn QC commented: “Any employer which still has a policy of compulsory retirement would be well advised to review this in the light of the court’s remarks.”

Employers may still be able to retire employees lawfully at a set age provided that the retirement age can be objectively justified “as a proportionate response to a legitimate aim”.

According to guidance from employment relations specialist Acas, employers would need to justify such a policy by ensuring that the retirement age meets the legitimate aim test, for instance in workforce planning (the need for business to recruit, retain and provide promotion opportunities and effectively manage succession) or the health and safety of individual employees, their colleagues and the general public.

If you want more information then please contact accountants in Lichfield.

Wednesday, 4 April 2012

Stamp price rises to soar

Royal Mail has announced steep rises in the prices of stamps from 30 April 2012.

The price of a first class stamp for a standard letter will rise from 46p to 60p and the cost of a second class stamp for a standard letter will rise from 36p to 50p.

The announcement, on 27 March, followed a decision by Ofcom on a new regulatory framework for Royal Mail after Ofcom said Royal Mail’s financial position put the viability of its universal service – its obligation to deliver mail to every UK address every working day – at risk.

Royal Mail said the price increases were needed to put the universal service on a sound, sustainable and secure basis.

Moya Greene, Royal Mail chief executive officer, said: “We know how hard it is for households and businesses when our economy is as tough as it is now. No-one likes to raise prices in the current economic climate but, regretfully, we have no option.”

Royal Mail said that UK businesses that use meters benefited from discounts of up to 38 per cent on stamp prices and that even after the increases, first class prices for letters sent in this way would be around four per cent lower in real terms than in the early 1980s and second class prices around 13 per cent lower in real terms.

But Forum of Private Business chief executive Phil Orford said:  “This will merely prove to be yet another increase in the cost of doing business for SMEs.

"We will certainly be looking over the shoulder of Royal Mail to ensure they don't punish the wealth-creating businesses by above-inflation increases. The quickest way for the Royal Mail to decline further is by pricing businesses out of their service.

For low income households, Royal Mail will keep stamps for letters for Christmas 2012 at the same price as in 2011. Households on pension credit and employment and support allowance (or incapacity benefit) will be able to buy up to three books of 12 stamps – 36 stamps in total – from any Post Office branch from 6 November until the last posting dates before Christmas.

If you want more information then please contact accountants in Lichfield.   

Link: Royal Mail announcement

Self-employed plumber jailed for tax evasion

A man has been jailed for 12 months for evading £91,000 of income tax and national insurance during ten years of trading as a self-employed plumber.

David Williams, 53, was sentenced on 27 March at Wolverhampton Crown Court. Mr Williams, of Rowley Regis, Sandwell, admitted charges of evasion of income tax, contrary to the Taxes Management Act 1970. He had been arrested in September last year after an HM Revenue & Customs (HMRC) investigation found thousands of pounds in cash at his home.

HMRC targeted plumbers in a special campaign in 2011. Nine more plumbers have been arrested and investigations are ongoing.

Other such disclosure campaigns have focused on offshore investments, medical professionals, private tutors and coaches, companies not paying VAT, electricians and online marketplace traders.

More than £500 million has been raised from these campaigns and more than £110 million from follow-up activity by HMRC.

Adrian Farley, assistant director of criminal investigation for HMRC, said: “We will not hesitate to investigate those we suspect of evading tax. I would ask anyone with information about people who may be involved in tax evasion to contact the Tax Evasion Hotline on 0800 788 887.”

Anyone wishing to make a voluntary disclosure of unpaid tax under one of the HMRC’s current campaigns can do so via

If you want more information then please contact accountants in Lichfield.   

Be prepared for Diamond Jubilee, employers told

Employers are being urged to plan ahead for the Queen's Diamond Jubilee holiday in June.

To mark the occasion, the last bank holiday in May has been moved to Monday, 4 June 2012 and there will be an extra bank holiday on Tuesday, 5 June.

Now Acas has reminded employers to plan ahead to avoid last minute leave request clashes or short-term absences.

Acas national helpline manager Stewart Gee said: "With two bank holidays at the beginning of June, employers may receive more requests for time off.

“We're already getting calls to the Acas helpline from employers seeking advice. It's important to be as fair and consistent as possible by having a policy on how to manage time off and leave requests so employees can join in the celebrations and employers can maintain morale at work." Acas says employers need to bear in mind the following points:
  • there is no statutory right to bank/public holidays, so the announcement of an extra bank holiday does not increase any entitlement to holiday under the Working Time Regulations.

  • whether an employee will benefit from the additional bank holiday will depend on the wording of their contract. For example, a contract that entitles a worker to, 20 days annual leave in addition to all statutory, bank and public holidays, would potentially give the worker an extra day's paid holiday. But if public holidays are listed by name, in a contract, a worker may not be automatically entitled to the extra public holiday.

  • there is no legal right to be paid any extra for working a bank holiday. This will depend on the terms of the employment contract.
If you want more information then please contact accountants in Lichfield.  

Link: Diamond Jubilee guidance for businesses

Auto-enrolment threshold to be aligned with tax

The government has announced that automatic pension enrolment rates are to be aligned with tax and national insurance thresholds, to streamline administration for businesses.

In October, the largest employers will be the first to start automatically enrolling employees into qualifying workplace pension schemes and making contributions to the schemes, to which employees who opt to stay in will also contribute. The roll-out programme will continue until 2018, by which time all new employers will be coming on stream automatically.

Announcing the measure on 26 March, Minister for Pensions Steve Webb said there had been an “overwhelming response” to the government’s consultation on the issue to align the automatic enrolment trigger with existing payroll thresholds.

He said: “This will help firms make a success of these reforms, as they will be able to better understand who is eligible to be enrolled.

"These changes strike the right balance between getting as many people into workplace pension saving as possible and ensuring that we do not enrol some people who would not financially benefit from saving.

“People who are excluded from automatic enrolment will still be able to opt themselves in, benefiting from a contribution from their employer.

Employers will therefore pay contributions on employees' earnings between £5,564 and £42,475 at 2012-13 rates. A worker will be automatically enrolled into a workplace pension scheme if they earn more than £8,105 per year, the same threshold above which they pay income tax.

The rates will be reviewed by the government each tax year.

If you want more information then please contact accountants in Lichfield. 

Link: Automatic enrolment guidance

HSE delays move to reclaim costs

The Health and Safety Executive (HSE) has delayed the introduction of a scheme under which it would recover its costs from businesses that break health and safety laws.

The HSE said on 15 March that the Fee for Intervention (FFI) cost recovery scheme would not now start in April 2012, as originally planned. It said it would be introduced at “the next available opportunity”, likely to be October 2012.

The scheme sets out to recover costs from those who break health and safety laws for the time and effort HSE spends on investigating and taking enforcement action. Businesses that comply with the law will not face any charge.

Gordon MacDonald, HSE's programme director, said: "The government has agreed that it is right that those who break the law should pay their fair share of the costs to put things right - and not the public purse.

"Discussions are still taking place on the technical details of the scheme, which we expect to conclude soon. Therefore, FFI will not be introduced in April but at the next available opportunity, which is likely to be October 2012."

HSE said it would be using the extra time to work further with businesses to improve their understanding of the scheme and how it will affect them. It is also trialling the new processes and procedures involved in operating the scheme.

Detailed guidance for employers and organisations will be available on HSE's website ahead of implementation.

If you want more information then please contact accountants in Lichfield.

Link: Background information on cost recovery scheme

R&D tax credit consultation launched

The government has launched a consultation on the new above the line (ATL) research and development (R&D) tax credit for larger companies, to help shape the way it should work when it is introduced in April 2013.

The new credit was originally announced by the government in the autumn of 2011 and flagged up by Chancellor George Osborne in his 21 March Budget.

Launching the consultation on 27 March, David Gauke, Exchequer Secretary to the Treasury, said:  “The ATL credit for R&D will encourage large company research and development, and ensure that the UK continues to be one of the most attractive places in the world to undertake R&D.”

The new ATL credit will be recorded in companies’ accounts as a reduction in the cost of R&D – i.e. as an ‘above’ the tax line – which will bring UK support for R&D into line with countries including France, Canada, Ireland.

It will be calculated as a percentage of the company’s R&D spend and Budget 2012 announced that the minimum rate would be 9.1 per cent before tax.

Loss-making companies will also be able to claim a payable credit. With the existing R&D tax credit, businesses must wait until they enter profit before they benefit from government support.

The small company R&D tax credit rate will rise from 200 per cent to 225 per cent from April 2012.

Existing R&D tax credit schemes provide around £1 billion a year support to around 9,000 companies carrying out over £10 billion of R&D expenditure.

If you want more information then please contact accountants in Lichfield.

Link: Consultation details

Thursday, 2 February 2012

Mediation pilot aims to resolve workplace disputes

A new government pilot scheme could pave the way to earlier and more cost-effective resolution of workplace disputes.

The Department for Business, Innovation and Skills is to fund mediation training for employees from a group of 24 small and medium-sized enterprises (SMEs) in each of two pilot areas, centred on Cambridge and Manchester, later this year. Trained mediators will be available to provide mediation to other organisations in their respective regional network, with the aim of the pilot to resolve workplace disputes, at the earliest possible opportunity, before they reach the employment tribunal stage. The pilots will run for 12 months and, if successful, the government will consider introducing them into other areas of England, Scotland and Wales.

Business Minister Edward Davey said: “We have always said that employment tribunals should be a last resort for resolving workplace disputes. “Mediation offers an informal method of dispute resolution and can be used at the point when problems first arise in the workplace. For both employers and employees, it can mean avoiding the need for formal discipline and grievance procedures. And it can also mean avoiding the time-consuming, complex and often stressful employment tribunal process.

“We want to help employers and employees to help themselves. In particular our consultations showed SMEs are often not aware of the benefits that mediation can bring for both parties. This pilot will directly target this group, help to raise awareness of the benefits and reduce the burden on the tribunal system.”There were 218,000 tribunal claims in 2010-11, a rise of 44 per cent since 2008-09, with each business spending an average of nearly £4,000 per claim defending itself.

If you want more information then please contact accountants in Lichfield.

Link: Acas information on mediation

Move set to boost co-ops

New legislation will be introduced by 2015 that will help to make it as easy to set up a co-operative as any other form of business, the Prime Minister has announced.

David Cameron said on 19 January that more than a dozen outdated pieces of legislation would be streamlined into the Co-operatives Bill, adding that the move was designed to remove barriers to “encouraging choice (and) opening up new forms of enterprise.”
Ed Mayo, Secretary General of Co-operatives UK, said: “The new act is intended to make it as easy and natural to form a co-operative as any other form of business.
“We are delighted to see the coalition taking action to put co-operative businesses on an equal footing and create a diverse economy.

 “Co-operatives, as well as being widely recognised for their ethical business practices, are a vital part of the British economy, employing more than 235,000 people, turning over more than £33 billion each year and generating a significant amount of wealth for the country.”

If you want more information then please contact accountants in Lichfield.

Link: Co-operatives UK

New tax dispute scheme put to test

A pilot scheme has been launched for a new way to resolve disputes between SMEs and HM Revenue & Customs (HMRC).

The Alternative Dispute Resolution (ADR) uses independent HMRC facilitators to resolve disputes between HMRC and small and medium-sized enterprises during a compliance check but before a decision or assessment has been made. The pilot, which will run in North Wales and the North West, follows a successful trial in which 60 per cent of disputes were either fully or partially resolved.

HMRC’s Jim Stevenson, assistant director, local compliance, said: “ADR will help SMEs resolve disputes without having to go to a tribunal – saving them both time and money. The facilitators are HMRC members of staff who have been trained in ADR techniques and have not been involved in the dispute.

“We have found that often there are communication problems. So the HMRC facilitator will help all parties reach a shared and full understanding of the disputed facts and arguments. The aim is to resolve the dispute or, if not, as many issues as possible.”ADR does not affect existing processes or review and appeal rights, and covers both VAT and direct taxes.

If you want more information then please contact accountants in Lichfield.

Link: HMRC and ADR

SME manufacturers offered new support

A new national programme has been launched to help small and medium manufacturing businesses to grow.

The new Manufacturing Advisory Service (MAS) became available to all manufacturing businesses across England from 3 January.It will be delivered by the Manufacturing Advisory Consortium (MAC) and it has been estimated that it will help to generate £1.5 billion in economic growth, 23,000 jobs and safeguard 50,000 jobs.

Launching MAS, Business Minister Mark Prisk said: “Manufacturing contributes half of Britain’s exports and has much higher productivity than the rest of the economy so it is essential to our plans for growth. That is why we are taking steps to ensure our industrial base is thriving as part of a strong and balanced UK economy. “The new Manufacturing Advisory Service will play a key role, providing tailored advice to businesses helping them to grow and thrive, with a specific focus on helping SMEs improve competitiveness and unlock their growth potential.”

Small manufacturing businesses will also have access to a new initiative recently announced by the government to improve the global competitiveness of UK advanced manufacturing supply chains. A fund of up to £125 million will help to support the UK supply chain, encourage new suppliers to invest in the UK and support economic growth.

If you want more information then please contact accountants in Lichfield.

Link: MAS website

‘Online only’ VAT returns weeks away

HMRC has issued a reminder to VAT-registered businesses that all VAT returns must be submitted online from April.

Currently, only newly-registered businesses and those with turnovers of more than £100,000 have to submit VAT online, as well as paying electronically. Anyone else can send HM Revenue & Customs (HMRC) a paper VAT return, if they wish. From April, all 1.9 million VAT-registered businesses in the UK will have to submit their VAT returns online, and pay electronically, for accounting periods beginning on or after 1 April 2012.

Every VAT-registered trader not already required to submit online will receive a letter from HMRC in February, advising them of the change, and what steps they need to take. HMRC says the move to online filing and payment will bring benefits including:
  • an automatic acknowledgement that a return has been received
  • an email alert to remind you when your next online return is due - after April HMRC will stop sending out paper returns to customers who are now required to submit online).
Businesses that have not submitted VAT online previously need to visit and click “Register” under the “New user” section, then follow the instructions.  

If you want more information then please contact accountants in Lichfield.

Link: HMRC guidance

PM backs small businesses in new campaign

Empty and under-used government offices may become home to start-up and growing small businesses, under plans forming part of a new initiative announced by Prime Minister David Cameron.

The Business in You campaign, launched by Mr Cameron on 23 January, is designed to inspire people to launch or expand their own businesses and help entrepreneurs and small business-owners understand the range of information and help available from the government and the private sector.The campaign, running nationwide throughout 2012, will draw on the real life experiences of small business-owners to encourage new entrepreneurs and features a Business in You web portal, bringing together a range of useful resources.

Some of the organisations involved in the campaign will also offer free services, including workshops, web-based seminars and video tutorials on issues like finance as well as providing mentoring and access to face-to-face consultancy sessions.  Each month, the campaign will also focus on a different theme relating to start-ups and growth, including exporting and employment.

Mr Cameron said: "Small businesses and entrepreneurs are the lifeblood of the British economy and I am determined that we, working with the private sector, do everything we can to help them to start up and to grow in 2012.

“I want to encourage people to go for it and make this the year of enterprise – whether that is fulfilling their dream of starting a new business or taking the leap to grow their business, to employ more staff, or to start exporting." Partners in the campaign include StartUp Britain, the Confederation of British Industry, the British Chamber of Commerce, the Institute of Directors, the Federation of Small Businesses and the Forum of Private Business..
If you want more information then please contact accountants in Lichfield.

Link: Business in You web portal

Company law in red tape spotlight

Companies are being asked for their views on how to tackle unnecessary bureaucracy in company and commercial law in the latest phase of the government’s Red Tape Challenge to scrap unnecessary regulations.

For three weeks from 26 January, the Red Tape Challenge will focus on more than 120 company law regulations, guidance and enforcement processes that businesses deal with on a daily basis. It asks for a variety of suggestions about how regulations can be improved, simplified or abolished, while maintaining a company law framework that gives companies the flexibility to compete and develop effectively. Issues open for comment include:
  • the internal workings of companies and partnerships – including rules on shares and share capital, requirement to hold information at business premises and rules on meetings and resolutions.
  • accounts and returns – including the content, form and auditing requirements of financial accounts and other reports.
  • the rules covering business names
  • disclosure of company information - the regulations covering the information companies must supply to the official register.
Business Minister Edward Davey said: “We want to have a flexible regulatory framework within company law to allow firms to compete and grow successfully. The Red Tape Challenge is a great way for the public and firms to tell us what is a nuisance or gets in the way of doing business effectively.

“The feedback we receive will allow us to build on the Companies Act 2006 to look at areas such as the audit regime to assist small and medium-sized companies as well as the approach to filing documents at Companies House. “I am open to new ideas to simplify, merge or discard additional rules that will enable firms to do business with more confidence.”

If you want more information then please contact accountants in Lichfield.

Link: Red Tape Challenge website