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Getting the Most Out of Your Work Experience

During  the summer we had a couple of students, who got in contact with us looking the opportunity to gain some work experience. We were very keen to give them the opportunity to gain an insight in to the world of accountancy, however, whilst our offices are currently being completed we decided to take on just one and settled on Kirsten, who we found to be incredibly enthusiastic. I then had this idea to write an article on gaining the most out of your work experience. I tried (desperately) to recall my days spent in work experience and realised all to quickly how much time had passed by!! I then decided to ask Kirsten if she would like to contribute to this instead. I want to share with you all her thoughts, because, to be totally honest she has summed it up better than I could……..

 

Getting the Most Out of Your Work Experience

By Kirsten Doran

“Like the average seventeen year-old, work experience was a concept I avoided, worried that I would be set menial tasks such as photocopying and making coffee. However, my time spent at JSR Chartered Accountants proved this was not always the case. If you’re really lucky (like me!) you might even enjoy it and be sad to leave! In order to get the most out of your work experience I’m going to give you a few tips.

Tip 1: Build a relationship with your mentors

A chat over cup of coffee and biscuits helps to break the awkwardness when you’re in an unfamiliar environment. Don’t be afraid to ask questions! Being able to talk comfortably with Jonathan and Stacie enabled me to find out the pros and cons of the job I was interested in, from those who know best. I honestly felt as if I was wanted in their office as they made me feel so welcome. It also helped me to work at ease and enjoy every second of it!

Tip 2: Be prepared to learn

Your short time at work experience flies by, especially if you’re having fun, so cherish every minute you get. It’s a good idea to bring a notebook with you to jot down the things you’ve learnt for future reference, such as during a university interview. I genuinely feel as if I learnt a huge amount at JSR Chartered Accountants and went from knowing little or nothing about the profession to gaining a great insight. At the end of it I felt like a real accountant!

Tip 3: Reflection

At the end of the day, it’s important to ask yourself “Is this the job you want to commit to?” And even if the answer is no, at least you know! In my case, I was previously uncertain if this was the job for me because its extremely hard to tell on paper. However, once I was thrown into the working environment I was pleasantly surprised and since then, I’ve firmly decided that accountancy is the career path I wish to take.

My time at JSR Chartered Accountants was so valuable and I’d like to thank Jonathan and Stacie Ross for inviting me into their business and giving me much needed experience.”

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BUDGET 2014 THE KEY POINTS

 

PERSONAL TAX

  • The Personal Allowance will increase from £9,440 to £10,000 from April 2014 and to £10,500 from April 2015
  • Threshold for 40p income tax is to rise from £41,150 to £41,865 next month and by a further 1% to £42,285 next year.
  • Inheritance Tax waived for members of emergency services who give their lives in the job
  • 10p rate for savers is abolished

 

NATIONAL INSURANCE

  • The primary threshold for employees will increase from £7,755 to £7,956
  • Upper Earnings Limit will rise from £41,150 to £41,865
  • New NIC employment allowance of £2,000 begins in April 2014
  • Under 21’s taken out of employers’ national insurance contributions

 

CORPORATE TAX

  • Currently at 23%
  • Will be cut to 21% in April 2014
  • Will be cut again to 20% April 2015

 

PROPERTY AND INFRASTRUCTURE

  • Help to buy equity loan scheme extended to March 2020
  • From midnight tonight properties bought for more than £500,000 through “corporate envelopes” will be liable for 15% Stamp duty.
  • Government to create £500m builders finance fund which will provide loans to developers to unlock housing units stalled due to difficulty accessing finance

 

 

BUSINESSES

  • Annual investment aallowance to be doubled to £500,000 until the end of 2015
  • First enterprise zone in Northern Ireland to be established in Coleraine, which the government will support by offering enhanced capital allowances to investors within that zone.

 

DUTIES

  • Fuel duty rise as planned for Sept 2014 has been cancelled
  • Beer duty will be cut by 1 penny from 24 March 2014
  • Duty on spirits will be frozen for 2014-15
  • Machine games duty (MGD) the government will create a new higher rate of machine games duty at 25% for B2 machines
  • Bingo duty will be reduced from 20% to 10%
  • Tobacco duty will increase by 2% above the rate if inflation from 6pm on 19 March 2014. Annual duty increases of 2% above the rate of inflation will continue until the end of next parliament.

 

SAVINGS

  • A new single ISA will be introduced with equal limits for cash and stocks and shares. The annual investment limit will be increased to £15,000 per year
  • The cap on investments in premium bonds will be lifted from £30,000 to £40,000 from 1 June 2014, to be lifted again to £50,000 in 2015-16

 

PENSIONS

  • All tax restrictions on pensioners’ access to their pension pots to be removed. The taxable part of pension pot taken as cash on retirement to be charged at normal income tax rate, typically 20% down from 50%
  • There will be an increase in total pension savings people can take as a lump sum to £30,000
  • The total amount you can contribute to your pension scheme with tax relief each year is being cut from £50,000 to £40,000
  • The tax free lifetime allowance for the value of your pension pot is being cut from £1.5m to £1.25m

 

CHILDCARE

The Tax free childcare costs cap, against which parents can claim 20% support, will be increased to £10,000 per year for each child. This will mean that eligible parents can now benefit from greater support, worth up to £2,000 per child per year from autumn 2015. Tax free childcare will be rolled out to eligible families with children under 12 within the first year of the schemes operation.

 

The new 12 sided £1 coin to be introduced in 2017

£1 coin

 

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Gift Aid for charities and community amateur sports clubs

 

In recent months we have been asked about Gift Aid, both by Charities and also by those who donate to Charities; so we thought it might be a good time to pull together a quick summary to help explain the position.

In this article we will look quickly at Gift Aid from the perspective of the charity.

 

What is Gift Aid?

Gift Aid is a method of allowing Charities to increase the value of gifts of money they receive from UK Taxpayers.  Gift Aid can increase the value of a donation from £1.00 to £1.25.

 

How does it work?

In order to make a Gift Aid claim a charity or CASC (community amateur sports club) must be RECOGNISED by HMRC as a charity for tax purposes.  A Gift Aid application can be made by any UK based charity.

Gift Aid claims can be applied to monetary gifts from UK tax payers.  The donation must have been received from a UK taxpayer who must also provide the charity with a signed Gift Aid declaration.  This declaration can be applied to a “one-off” donation, or the donor can elect to have the declaration applied to all donation made by them to the Charity from a particular point in time.  This declaration can be back dated.

 

How to make a claim for Gift Aid?

Once your charity is recognised by HMRC you can then consider how and when to make an application to claim the Gift Aid on any applicable donations.

 

What counts as a donation for Gift Aid purposes?

Gift Aid can only be claimed on gifts of money from individuals, sole traders and partnerships.  The donation must have been made in one of the following forms:

Cash

Cheque

DD (Direct Debit)

Credit/ debit card

Postal Order

Standing Order or telegraphic transfer

 

What does not count as a donation for Gift Aid purposes?

Donations from a limited company

Donations in the form of a loan waiver or debt conversion

Gifts made on behalf of someone else

Gifts with a condition about repayment

Gifts with a condition that the charity buys product or services from the donor

Payments received in return for goods or services

Where the donation is a “minimum donation” i.e. where the donor does not have any choice in the minimum value they can donate

Gifts made using Charity Vouchers or Charity Cheques

Donations received before HMRC recognises your organisation as a Charity for tax purposes

 

“Small” value donations don’t qualify for Gift Aid, do they?

This can depend on when the donation was made.  Small donations, less than £20.00, made after 6 April 2013 can qualify for Gift Aid.

HMRC recently released a new scheme, The Gift Aid Small Donations Scheme, which… “allows eligible charities and CASC’s to claim top-up payments from HMRC on small cash donations that they receive.”  For more information on this scheme see http://www.hmrc.gov.uk/charities/gasds/

In order for a Charity to apply a donation to this scheme it must meet the following criteria:

The donation should be less than £20.00 in value.

The donation can only be made by cash (cheques, DD’s, Standing Orders do not qualify)

The maximum amount of “small donations” that Gift Aid can be applied to in any one tax year is £5,000.

PLEASE NOTE – Any small donations received before 6 April 2013 however do not qualify.

 

How much is Gift Aid worth?

According to the Institute of Fundraising website they estimate that… “charities are currently missing out on approximately £740 million each year in Gift Aid income” (http://www.institute-of-fundraising.org.uk/guidance/tax-effective-giving/).

 

What next?

If you would like to find out more about Gift Aid please feel free to contact us.  We will be issuing some further quick articles on Gift Aid within the next few days.

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Bookkeeping software – The mind boggles!

So you are at the point now where your business needs a computerised bookkeepping package, but where to start and what to choose?

 

We are increasingly finding that our clients are needing this more than ever now, and its all good! Although it seems like just another time consuming hassle, it means their business is growing!

 

However, when it comes to chosing the right software, where would you even start?

 

It is important you chose the right software for your buisness, which may not be the same as what your neighbour or friend is using! Every business has it’s own unique set of requirements.

The wrong software will leave you frustrated and feeling bombarded because it will either be too simple and not provide the exact information that you and your business needs, or be too complicated and not only cost a lot but will leave you feeling extremely overwhelmed!

We can help!

 

We have been able to advise numerous businesses on their software needs, simply because we understand their business and know what they need to expect out of their software.

 

A few helpful points we have come across are as follows:

 

1. Only  a Few Transactions a Month?

 

If your business only has a few transactions a month, then you may not need bookkeeping software at all.

  • You will be able to get by using Excel, or even a paper filing system, and simply hand over the papers to your accountant when he needs them.
  • Make sure you have a separate bank account. These are generally the first thing we ask for and it helps if your business account is seperate from your personal account. This saves alot of time and makes the process of bookkeeping simpler.

 

2. Requiring regular Management Accounts?

 

If you require a regular set of Management Accounts then you will most certainly need bookkeeping software.

You should be looking at bookkeeping software that has purchase ledgers, sales ledgers, bank reconcilliation functions and is able to pull out reports such as Creditors and Debtors reports and provide  you with an easily understandable Profit and Loss Account and balance sheet.

 

3. Only Statutory Requriements

 

If you just want to fulfil your obligations to file returns  and produce annual accounts then keep it simple.

There are many packages out there that can be user friendly and help you submmit these necessary returns. They can also be easily adapted to pull out more reports if you decide you do need them.

 

4. Another alternative is to let us do it for you.

 

  • We have a broad range of skills and are well experienced in doing this
  •  We already have the software thus saving you that hassle and cost
  • We are used to the routine of bookkeeping saving you the hassle of finding the time to actually sit down and do it, letting you concentrate on your customers and your business
  • With  internet and email, information can pass efficiently and timely

 

Whatever your bookkeeping requirements why not contact us to discuss what is best suited to you and your business.

 

email us at info@jsrcharteredaccountants.co.uk

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Single Use Carrier Bag charge – VAT implications (Part 2 )

What happens if a retailer charges the customer more than the minimum 5 pence for a single use carried bag?

 

If we look an example where a retailer charges 12 pence for a single use carrier bag.

The full amount of the 12 pence is subject to VAT.  The “net sale” would amount to 10 pence and the VAT on the sale would amount to 2 pence.  The retailer, assuming he/ she is VAT registered, MUST charge VAT  on the full amount charged to the customer (provided the charge is greater than 5 pence per bag).

The amount payable to The Department of the Environment is still 5 pence.

In this instance the “sale” is deemed to be “within the scope of VAT”.

The retailer MUST charge VAT on the full amount of the proceeds of each bag sold.

 

The Net Sales entry on their VAT return (Vat Return Box 6).  The retailer needs to include the net proceeds generated from sale of bags in their routine VAT returns.  In the above example that would equate to 10 pence for each bag sold during the VAT return period.

 

The VAT due in this Period (Vat Return box 1).  The retailer needs to include the VAT liability arising on the sale of the bags in their routine VAT returns.  In the above example that would equate to 2 pence for each bag sold during the VAT return period.

 

The retailer can reclaim an input VAT incurred on the purchase of the carrier bags as normal.

 

Single Use Carrier Bag quarterly returns – please see our first article in this series where we discussed the information to be included in the quarterly returns to The Department of Environment. https://jsrcharteredaccountants.com/single-use-carrier-bag-charge

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Single Use Carrier Bag Charge – VAT implications

Vat implications of Northern Ireland’s Single Use Carrier Bags Levy

 

On Monday 8th April 2013 the Single Use Carrier Bag Levy came into force.

 

The VAT treatment of the Single Use Carrier Bag Levy in Northern Ireland differs from how it is currently treated in Wales.

 

Practical Implications for a VAT Registered retailer operating in Northern Ireland:

If a retailer charges the minimum allowable charge of 5 pence per single use carrier bag, then the sale is classified as being … “Outside of the scope of VAT”, and as such:

  • The retailer doesn’t charge the customer any VAT on the 5 pence charge for each bag.
  • The retailer does not include the 5 pence proceeds generated from each carrier bag in the Net Sales entry on their VAT return (Vat Return Box 6)
  • The retailer does not include any VAT liability on the 5 pence proceeds generated from carrier bags within VAT due in this Period (Vat Return box 1).
  • The retailer may reclaim any input vat incurred on the initial purchase of these carrier bags.

 

In our next article we’ll take a quick look at the VAT implications of charging more than the minimum 5 pence per bag.

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Single Use Carrier Bag Charge

 

Northern Ireland’s Single Use Carrier Bags Levy

 

 

As from Monday 8th April 2013 the Single Use Carrier Bag Levy came into force.

 

This piece of legislation is aimed at reducing the amount of plastic bags that are dumped into landfill each year in Northern Ireland.

 

From this date “all sellers of goods in Northern Ireland must charge their customers at least 5 pence for each single use carrier bag supplied new”.  The retailer must collect this money from the customer, and then forward this money on to The Department of Environment on a quarterly basis.

 

The retailer will also be required to complete and submit a quarterly return online detailing:

  • No of new single use carrier bags issued from each location
  • Proceeds received from single use carrier bags supplied to customers
  • The amount of VAT chargeable
  • The net proceeds of the charge
  • The retailer has an obligation to keep records in support of the above noted points for 6 years.

 

In our next article we’ll take a quick look at some of the VAT implications on the carrier bag levy.

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RTI for PAYE – What is it all about?

 

HMRC’s new system of reporting PAYE and what it means for you and your business.

 

From 6 April 2013 you will have to start reporting PAYE information in real time. You may see this referred to as Real Time Information – or RTI. HMRC have introduced this new system for reporting PAYE for large and small business including Limited Companies with the main objective to enable more accurate PAYE reporting. The more accurate the information the better the chance that employees will be on the correct tax code and thus ideally, less mistakes from HMRC will be made.

What this really means is that HMRC will receive information on employers PAYE per pay period, rather than receiving it all at once at the end of the tax year. By receiving Pay As You Earn information in real time, HMRC have the opportunity to pick up on and amend any errors as they occur, rather than trying to reconcile a backlog of errors and inconsistencies at the end of the tax year. This decreases the likelihood of you being lumped with an unexpected penalty.

RTI is only relevant to employers, so if you operate as a sole trader, with no employee’s, the changes do not apply to you. As the director of a Limited Company however, you do have to report your PAYE salary, if you take one, when it is paid to you as an employee of your Company.

What do you have to do?

 

As an employer, each time you pay an employee, you already keep payroll information. After 6 April 2013 you will still operate PAYE in the same way but you must submit the payroll information you already keep to HMRC on or before the day you pay your employees. Your payroll software will generate the new reports you need and submit payroll information online, (please check with your current payroll software provider now to ensure all is in order). These will include details of:

  • the amount you paid your employee(s)
  • deductions, such as Income Tax and National Insurance contributions (NICs)
  • starter and leaver dates if applicable

You need to include the details of all employees you pay, including those who earn below the NICs Lower Earnings Limit (LEL), for example students.

 

You no longer submit end-of-year forms P35 and P14 and the starter and leaver process is simplified. You continue to give your employee a form P45 (employee parts) when they leave but you no longer send forms P45 (part 1) or P46 to HMRC. Instead you must report all starter and leaver information via your payroll software each time you pay someone. When you run payroll, your software gathers the PAYE information you send to HMRC, based on the payroll entries you make.

You can use any RTI-enabled commercial payroll software (there are some free packages available) or HMRC’s Basic PAYE Tools package which is designed for employers with nine employees or fewer. You submit your PAYE information online to HMRC using commercial payroll software or HMRC’s Basic PAYE Tools, if it’s suitable for you. You do this via the Government Gateway, the online entry point to government services. You cannot use HMRC’s PAYE Online Returns and Forms direct from the HMRC website to send this PAYE information.

 

It’s very important you use accurate employee details, such as full name, home address, date of birth, National Insurance number and gender before the new PAYE real time is introduced within your business. By doing this you will:

  •  ensure employees pay the correct Income Tax and NICs
  • make it easier to match the information you send with HMRC’s record of your employee
  • reduce the number of employee queries you receive from HMRC

 

The best way to check these details are correct is to verify them against a birth certificate, passport, driving licence or official document from HMRC or the Department for Work and Pensions.

 

 

RTI will be beneficial for you because your remittance advice will be accurate and the information held by HMRC will all be correct meaning no nasty surprises, no confusion and hopefully faster processing from the HMRC.

 

For further information on RTI payroll please feel free to contact us on info@jsrcharteredaccountants.co.uk,

See also http://www.hmrc.gov.uk/payerti/getting-started/index.htm

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2012 Autumn Statement

 

George Osborne delivered his 2012 Autumn Statement yesterday and we have summarised the key points below:

INDIVIDUALS

  • The Personal Allowance is to increase from £8,105 to £9,440 from April 2013 for those aged under 65. This is part of a plan to ultimately increase the Personal Allowance to £10,000.
  • The band of income tax rate at 20% is being reduced from £34,370 to £32,010 from April 2013
  • The threshold for 40% income tax is to decrease from £42,475 to £41,450 in 2013/14 but will increase by 1% in 2014/15 and 2015/16 to £41,865 and £42,285
  • The 50% band currently applies where taxable income exceeds £150,000 but the rate will fall to 45% next year.
  • New universal credit for Income Tax is coming into effect next year as previously announces
  • The Capital Gains Tax annual exemption is to increase by 1% to £11,100
  • The Inheritance Tax exemption is to increase in 2015/16 from £325K to £329K
  • No new tax was implemented on property
  •  From 2014/15, pensions lifetime allowance is to reduce from £1.5m to £1.25m and annual allowance from £50K to £40K. This restriction of pensions tax relief is a £1bn tax rise for high earners
  • The ISA limit extended from April 2013 to £11,520
  • The Basic State pension is to increase by 2.5% next year which is a rise to £110.15 per week
  • Tougher measures on welfare fraud are announced. Changes to welfare benefits will save £3.7bn in 2015/16
  • Child benefit is to increase by 1% for 2 years with effect from April 2014

BUSINESSES

  • Main rate of Corporation Tax cut by 1% to 21% in April 2014 (was set to be 22%), currently set at 23% for April 2013
  • Increase in Annual Investment Allowance for capital allowances from £25K to £250K from 1 January 2013 for 2 years. This is a huge boost for expanding businesses
  • A number of tax avoidance loopholes are to be closed immediately, and anti avoidance will be further tackled by an increase of 2,500 in the number of tax inspectors
  • New general Anti Avoidance Rule still be introduced in April 2013
  • £5bn to be received over 6 years from undisclosed Swiss bank accounts of UK residents
  • Temporary doubling of small business rate relief was to end 2011 – already extended to April 2013; now extended further to April 2014
  • Tax relief for employee shareholder scheme to be introduced
  • Consultation on new tax incentives for shale gas

OTHER ISSUES

  • The planned 3p rise in fuel duty from January 2013 is now cancelled.
  • Extra £5bn capital investment to be made in infrastructure – Northern Ireland will get its share
  • Broad band investment in various areas across UK
  • Extra £600m for scientific restructure in UK
  • £270m to be made available for improvements in further education in UK
  • £1bm to be made available to expand schools and build 100 new free schools and academies in UK
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Thinking of working from home?

The idea of working from home always sounds very idyllic especially to those who have never done it, however some businesses actually struggle to separate work from home life. In many cases, they actually work longer hours and enjoy less quality time with their families.It simply doesn’t work for some businesses, either. Nothing says unprofessional quite like a sink full of plates or the sounds of arguing children. The question is Can you really hold successful client meetings when your office is also your home?

Not to completely shatter the illusion, the home can be a great place to start a business and many of the UK’s finest companies started on the kitchen table. Start-up businesses, no matter where they originate, are not great for escaping stress and freeing up your time.

When the line between home and work gets blurred (which at times it inevitably will), things can get a little complicated. We all know that there are several situations that make working from home more difficult than we originally thought it was going to be. It actually requires a lot of discipline to make sure you’re staying at the top of your game when you’re not in an office environment.

Can you work from home?

If you can work well on your own without the necessity of others to hold you accountable or without that professional interaction you get from working with others then you are probably a good candidate for working at home. However, if you already have problems ‘switching off’ when you come home from work then you could have a problem.

 

How to put this into practice

To work from home you will most certainly need  to be self-motivated and not require others present to ‘push you on’.

You know yourself best — do the hard self-evaluation before you commit to the idea of an office at home.

Make sure you set up a separate workspace. If possible set aside an office space. Locating a corner in the kitchen or living room is not ideal it will not give you the separation that you need and can walk away from and will not make it easy to ‘go home’ at the end of the day. Naturally you need to make sure you have good lighting, ventilation etc.

Be sure to ‘Organise’ Your day

Get up as normal and do all the things you would normally do if you were heading out to work. Go to your office and end your day exactly how you would normally have. Create a proper structure and stick to it

Separating work and personal life

We touched on this in a previous article. Try not to get distracted by your personal to do list or grocery lists etc, try and ignore the personal element during your working day (as far as is possible).

On the other hand do not over work yourself, try not to talk about work when work is over or outside the ‘work room’ and try not to let your hours creep. Although we all do this just make sure there are clear boundaries.

Successfully working from home with kids can be difficult but it is not impossible. Set clear boundaries, let the kids know that the work room is not a room for the kids, help them to understand this and suggest they knock the door etc if they need in and explain to them that this is incase you are on the phone. Keep it clear of toys and other personal items.

It can be easy to feel isolated without the interaction with people during the day, stay in touch with people, clients, friends, colleagues. Where necessary meet clients, over lunch for example to help maintain that adult interaction.

In Conclusion

A few points in conclusion.

Stay productive –  its harder to charge by the hour when you work from home, consider charging for the end result.

Stay driven – but do not become a hermit or loose sight of who you are in the process.

Stay alert – don’t miss the opportunity to grow your business – just because you are based at home does not leave your service or product any lesser than any other.

Stay competitive – but do not undersell yourself just because you work from home.

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