The Book-keepers Network The BKN Blog

When is Lunch Tax Deductible?

BKN — Thu, 17 May 2012 20:04:05 GMT

Free or subsidised meals provided to staff in a works canteen are tax and NI free as long as the meals are available to all staff. The company does not necessarily have to have its own canteen, but the food must normally be provided on the business premises. The local pub cannot be designated as a staff canteen just for Friday lunchtime. If some company sites have a canteen but others do not, the subsidised food will still be tax-free as long as any employee can eat in the canteen if they happen to be on site.

Sandwiches, drinks and tea and coffee are all covered by this tax exemption if the refreshments provided are on a reasonable scale. For instance free fruit and snacks would be reasonable, but free champagne would not.

Working lunches for staff or directors are not a taxable benefit as long as the employees who are not involved also have the right to free food generally. It does not matter that the directors' food is not exactly the same as the staff canteen grub, as long as it is comparable. The Taxman would take a dim view of directors sitting down to a three-course meal with wine and cigars while the staff have tinned soup and rolls.

Example

All professional staff are required to attend monthly lunch-time training sessions where free sandwiches are provided. The company's support staff do not attend the training meetings. If the company provides free sandwiches for all the staff including the support workers, the free food is not a taxable benefit. If the professional staff eat all the sandwiches and leave nothing for the admin department a tax charge will arise.

In addition, when your employees are temporarily away from their normal base the employer can reimburse the cost of a reasonable meal without incurring further tax or NI liabilities.

Where food is provided to staff in any of the above circumstances the cost is tax deductible for the employer and any VAT charged on prepared food, such as sandwiches can be reclaimed. What you must avoid is any element of entertaining being wrapped up with the provision of the food. Meals provided to customers or potential customers will almost always be classed as entertaining, so the cost cannot be deducted for tax purposes, and the VAT cannot be recovered.

Is it worth your clients topping up their NI contributions?

BKN — Thu, 17 May 2012 19:54:26 GMT

Paying National Insurance contributions (NICs) builds up your clients’ entitlement to the state retirement pension, and to certain social security benefits, such as the jobseekers allowance, if they lose their job. However to receive most benefits your client must have a complete NI record covering at least two tax years, and to get a full state retirement pension they must pay NICs (or been credited with them) for up to 40 years.

If your client doesn’t pay NICs for a significant period, because they are studying, travelling, bringing up children, or caring for relatives, your clients NI record will have gaps. However some state benefits such as the carers allowance or child benefit, should plug these gaps with NI credits, but that credit system does not always work perfectly.

The Taxman's computer system should automatically send your client a letter if they have a gap in their NI contributions. The letter recommends that your client pays some voluntary NI contributions to complete their NI record for a certain tax year. Even if your client does have a gap in their NI record they may be better off contributing extra funds into an independent pension scheme, rather than paying more for their state pension. It all depends on your clients personal circumstances and their retirement plans.

Transfer ownership of a defined share in a property

BKN — Thu, 17 May 2012 19:57:37 GMT

Book-keeper Question: Before my client married they lived in a small flat, which is now let. My client would like his wife to receive the income from this flat to use up her personal tax allowances, as she is no longer working. How can my client arrange this?

BKN Answer: To share the income from the flat the property must be held in your clients joint names. Your client should ask a solicitor to transfer ownership of a defined share in the property to your clients wife. There will be legal charges and possibly Stamp Duty Land Tax to pay if the property is subject to a mortgage.

Life in the cloud (Part Two) - Fear & loathing with a little RTI

BKN — Fri, 11 May 2012 01:06:18 GMT

Last time I introduced the concept of SOAP (Sage Online Accounting Programme) to you all and now I want to educate and enlighten what it means to be part of the cloud and deal with the fear. Fear of the unknown, questions on data, low costs and how to evolve your business.

So, I’ve still not seen Arnie running after Linda Hamilton, and I'm also yet to bump into The Dr whilst in the cloud, but that's not to say that I won't eventually. Being part of the Sage team here in the cloud enables me to witness the evolution of a practice, which is both thrilling and scary all at the same time. When first introducing the idea of cloud to both bookkeepers and accountants, I often get the same tentative questions:

"if there were a nuclear war, how safe would the data be?"

This is often met with an unavoidable grin, as honestly? If you're still worried about data post nuclear war whilst I'm worrying about whether that tin of corned beef will be edible, then fair play!

"where exactly is this cloud of yours?"

Erm, is here, there and everywhere, although I felt maybe that they mean who provides the service. This would be Rackspace, and awesome provider of cloud solutions with credentials "up the ying yang" to quote a certain head of online, who will remain nameless, Nick Goode. Read his blog here: http://www.book-keepers.net/BKN-Interview-with-Sage

Although to trained ears, these questions may seem a little naive or flippant, they highlight that a number of bookkeepers and accountants are wary about this new way of working, which isn't always bad thing, when you drill down, as it is just born out of human nature.

If Edward Jenner had not given his own children the small pox vaccine, countless lives would've been lost, but it takes that leap to inspire others before you begin to feel trusted.

So, what would I say to the sceptics? Cloud is very safe. Sage One backs up every second, it comes with 24/7 phone support which is UK based, it isn't scary, in fact it is so simple to use, we don't offer training on it. (That said, I will happily demo the solution for you and your clients, just drop me a line via the forum or on twitter).

Any computer connected to the Internet is at risk, but I know that we have a lot more security measures in place on our servers in Rack Space that i do on my computer at home or the ones in any small business.

The government is also pushing cloud, probably without realising it! The Real Time (or RTI as you may Have heard it) Information act for payroll simply means you have to submit online as of next year every time you pay someone. Who knows what other things we will all have to comply with in the future.

With online products like SageOne Payroll, all the updates you need are simply delivered in the product that you can access from anywhere. No more being stuck in the office at payroll year end! As one customer told me the other day, he’s going to do his payroll runs from an iPad in Cyprus!

To summarise, you cannot leave cloud technology lying on a train seat, you cannot accidentally shred your accounts, and you cannot lose it like a USB stick. You can’t be behind on a version because you always have the latest one.

Sage one is safe, simple and will solve the headaches of manual bookkeeping, so why not try it out? I bet you will be pleasantly surprised, and if you're not, well there is just no pleasing some folks, I'll be back.

For more information on SageOne take a look at www.sage.co.uk/sage-one-accountant-edition

Alternatively, you call me free on 0800 092 8091, email me at francesca.holmes@sage.com and contact me on Twitter @franholmessage. I would be happy to create a Sage One account with you on the phone, demo the product, or just talk it through if you have any questions. You can be up and running with Sage One in under 10 minutes.

Tax Credits Claim

BKN — Thu, 10 May 2012 21:52:47 GMT

Book-keepers Question: Last month the Tax Office wrote to one of my clients saying that they would no longer receive tax credits, but they did nothing about it and have just handed me the letter. Now their wife is expecting another baby and has reduced her working hours. How can I assist my client and get their tax credits paid back?

BKN Answer: They will need to make a new tax credits claim as soon as possible, don't wait until the new baby arrives. Their reduced family income may mean that they qualify for working and child tax credits already, and if they don't, they will at least have submitted a protective claim for 2012/13. Under the new rules, from 6 April 2012 couples with children must work at least 24 hours per week between them, and one member of the couple must work at least 16 hours per week. There are exceptions if one person is disabled, incapacitated or a carer.

New Tax Dashboard

BKN — Fri, 04 May 2012 11:13:55 GMT

If you have recently logged-on to the HMRC online service for PAYE for employers, or corporation tax, you will have seen a request to sign-up for the tax dashboard. This is a new facility that will provide a single view of all your business tax liabilities arising from corporation tax or income tax (for company or individual), VAT and PAYE.

The tax dashboard will show the following for each tax:

- Amount owed
- Repayments due from HMRC
- Payments already made
- Interest due on any late payments
- Penalties incurred, and
- Direct debit payment plans

You will not be able to reallocate payments between taxes, or even between periods for the same tax. The dashboard is merely a viewing facility.

Before you can use the tax dashboard you must be registered with the HMRC online service for corporation tax or self-assessment. You may already be registered and have separate online logins for the PAYE, VAT and corporation tax or self-assessment online services. If this is the case you need to move all online services to one login, in order to see all taxes on your tax dashboard. There are instructions on the HMRC page for the tax dashboard on how to move online services to one login.

Tax agents cannot use the tax dashboard to view their clients' tax liabilities, which would be really useful. This facility may be provided in the future, but we are not holding our breath!

Employer or Personal Pension Funding?

BKN — Fri, 04 May 2012 11:14:56 GMT

Who should pay contributions into your pension fund: you or your employer? If you control the company you work for, the most tax efficient solution is almost certainly for the company to pay as your employer.

The company can set a reasonable level of pension contributions against its profits subject to corporation tax (at 20%, 24% or 25%), and it pays no employers' NI charges on those pension contributions. A 'reasonable level' is where the salary plus benefits, including pension contributions, form a commercially reasonable remuneration package for the work done. As long as the total package is set at a commercial level or below, the company can receive tax relief for the remuneration payments.

If you pay pension contributions as an employee, you need to extract the funds from your company. If you do this by a salary, this creates an income tax charge in your hands. The company receives tax relief on salary payments but it must pay employers' NICs at 13.8%, with no upper limit. You are also subject to NICs on your salary at 12%, which then reduces to 2% on salary over £42,475 per year. So unlike pension contributions paid directly by the company, salary payments carry NICs of up to 25.8%.

If you take dividends from the company to pay your pension contributions, there are no NICs payable by you or the company. But the company does not receive tax relief on the payment of dividends. So the only tax relief due on the pension contributions is due at your marginal tax rate, on up to 100% of your earned income, capped by your annual allowance (see below). Dividends are not earned income, so if you only take dividends and no salary or other employment benefits from your company, the tax relief on your pension contributions is limited to £3,600 per year, which is the maximum for a person with no earned income.

Your annual allowance caps the amount of your pension contributions which attract tax relief. If this allowance is exceeded by pension contributions paid by you or your employer, you will pay a tax charge at your marginal rate. The annual allowance is now £50,000 per year, but this is extended by unused allowances brought forward from the previous three tax years. Thus the exact amount of annual allowance will be different for each individual, depending on his or her pattern of pension contributions.

NIC holiday

BKN — Fri, 04 May 2012 11:17:23 GMT

Question: My client is thinking of starting a new company. Will it qualify for the NIC exemption?

BKN Answer: It depends where your clients business is based. Businesses in the east and south-east of England, or London, don't qualify for the so-called NIC holiday. The south-east region stretches all the way up to the Northamptonshire border, so your client needs to be quite clear where their principal place of business is. Secondly it must be a new business, not an existing business that has been transferred to a new company. There are also some excluded sectors such as road freight, coal and export businesses. You will need to review the detailed rules before your client applies for the NIC holiday.

'Sage Record Keeper' Mobile App - Now Live

BKN — Fri, 27 Apr 2012 00:25:52 GMT

Sage have released a new App for self employed individuals who need access to their records whilst their working or on the go.

The iphone app is free and easy to use and will allow your clients to provide their information to you even if they do not enjoy book-keeping.

The main functions of the Sage Record Keeper App are:

Record Cash In & Out
Take Photos of your receipts so that you do not need to worry about losing them
Check your current balances and your CIS deductions
Estimate the current year's tax and also have access to previous data

If you would like more information about the new Sage Mobile App, please use the link below:

http://www.sage.co.uk/product-information/finance-record-keeper-mobile-app.html

Filing Online Difficulties

BKN — Fri, 27 Apr 2012 00:06:06 GMT

Most tax and VAT returns now have to be submitted electronically, so if the return is late, even by a minute, the computer spits out a fine. This also applies to filing accounts and annual returns for companies or LLPs at Companies House.

Filing a tax return or submitting accounts online can be quicker, as there is no delay caused by sending a paper document in the post. Your client may also be given a longer period to file online, - an extra 7 days for VAT returns and an extra 3 months for personal tax returns. However, you will need software to file online, and this may not be freely available or the free version may not work for your particular circumstances.

Partnerships

For example, partnerships must submit a partnership tax return in addition to the personal tax returns for each partner. The partners' tax returns can be submitted online using the HMRC free software, but the partnership tax return cannot.

If your client is a member of a partnership (or LLP) you will need to either submit the partnership return in paper form by 31 October, or acquire some commercial software to use to submit the return online for your client.

Companies House Accounts

Private company accounts must be submitted to Companies House within 9 months of the company's year end. Say the company's year runs to 30 September 2011, the accounts must reach Companies House by midnight on 30 June 2012, even though this is a Sunday.

Companies House provides free software to submit company accounts online through its website, but this does not always work. If you leave filing your clients accounts to the last day, and the software, or your internet connection fails, your client will get a fine of £150.

VAT

All VAT returns for periods starting on or after 1 April 2012 must be filed online, and any VAT due must be paid electronically, not by a cheque.

Are you and your clients ready for this change?

How Gift Aid Works

BKN — Thu, 26 Apr 2012 23:58:48 GMT

There has been a lot of coverage in the press recently about tax relief for charitable donations.

When your clients make a donation to a charity or to a community amateur sports club they can make a declaration that their donation is made under Gift Aid. This declaration can be made in writing, online or over the phone, but in all cases it should include your clients name and address details, the name of the recipient charity, and a statement that they have paid sufficient UK tax to cover the 20% tax the charity will reclaim from the Tax Office.

For example, if your client makes a donation of £1,000 to a charity, and makes a Gift Aid declaration for that gift. This results in a gift of £1,250 in the charity's hands as they can reclaim basis rate tax (20%) on the gross equivalent of the gift. In this example, 20/80 x £1,000 = £250.

Your client will have to declare with their gift aid declaration that they have paid at least £250 in UK income tax or capital gains tax in the tax year in which they make the gift.

If they pay tax at 40% or 50%, the thresholds at which those higher rates are imposed are extended by the gross value of their gift, which gives your clients additional tax relief for their gift. For example, the 40% threshold is currently £34,370, so if they make donations under gift aid that total £1,000, these are treated as gross gifts of £1,250. Therefore, the 40% threshold is extended to £35,620, saving your client 20% tax on £1,250 = £250. So overall it would have cost your client £750 for the charity to receive £1,250.

It is not possible for your clients to completely eliminate their tax bill by making donations under gift aid. Such gifts would only reduce their tax bill to 20%.

Payroll Year End made easy

BKN — Thu, 19 Apr 2012 19:39:53 GMT

Almost all UK businesses that have processed pay for one or more employees during the tax year are required by law to submit their end of year returns to HMRC. This process must take place at the end of every tax year, which runs from 6th April to 5th April and these submissions must be made online. Only those who have an exemption from HMRC can submit their tax returns by paper.

HMRC require these returns so that they can monitor the PAYE and National Insurance deducted from your employees’ wages but to also ensure that all calculations have been made according to the legislation for the specific tax year.

Payroll Year End can be a frustrating and busy time for any business, so we’ve highlighted some points below which might just make the process a little easier:

Make sure you give yourself enough time to complete the year end:

The time it takes will depend on the number of employees you need to produce P60s for. Remember that if you find errors when to produce your P60s and P11s, it’s going to take time to resolve.

Submission deadlines to make a note of:

The old tax year ends on April 5^th 2012 and the new tax year begins on April 6^th 2012. Year End return must be submitted by the 19^th May 2012.

In addition to this you must provide a P60 certificate to each of your employees by the 31^st May 2012.

Remember, you might incur a fine for late or incorrect submissions.

Ensure you’ve got your Tax/District Reference and contact details for HMRC.

All submissions must contain the correct PAYE information. As it’s such a busy time of year it helps to know the right contact details if any issues arise. You can find the information you need at- www.hmrc.gov.uk

Are you prepared for the legislation changes?

Every year, legislation changes, and every year you must make sure you are compliant with these changes. Remember if your submissions aren’t accurate and up to date, you risk receiving a fine from HMRC.

Are you setup to make your submission online?

As stated, all UK businesses must submit their Year End returns online. You’ll have to register with HMRC before you can do this, so it’s a good idea to do this nice and early.

Thankfully, Sage One customers who employ staff won’t have to worry much as Sage One Payroll makes it really easy to process Payroll Year End.

It’s is a simple, online payroll solution for small businesses based in the UK, and is fully compliant with payroll legislation.

Every change in legislation with each tax year is automatically applied in Sage One Payroll so you don’t have to worry about downloading or installing anything.

You can submit your Year End returns in Sage One Payroll, online, direct to HMRC, safe in the knowledge that they’re accurate – all stress free! We’ve even developed the Year End feature to guide you through each step of the way, making the whole process as simple as possible.

Client Meetings

BKN — Thu, 19 Apr 2012 19:59:31 GMT

Book-keeper’s Question: If my client and his business partner meet at a local hotel to discuss future business plans, having a meal whilst there, will the cost of this be tax deductible?

BKN Answer: Providing your client definitely holds a meeting and could produce minutes to prove this, it is not for HMRC to challenge the scale of your clients "meetings" budget. For the avoidance of doubt add to those minutes that your client has chosen to eat in the restaurant to avoid the cost of hiring a room or to enable them to meet in the evening and so not waste the working day. Of course if your client meets in a hotel and refreshments are part of the package involving room hire, then the total cost plus travel costs would be allowable.

Leaving it to Charity

BKN — Thu, 19 Apr 2012 19:53:48 GMT

If you haven't made a Will, you should do so without delay. If you don't have any relatives you want to leave your estate to, consider making a Will that leaves most of your assets to specified charities. This avoids the potential problem of intestacy (dying without a Will), and saves tax as gifts to charities are free of inheritance tax. However, there are two traps to avoid:

Identifying the charity

Many charities have merged or changed their names in the recent past, so when it comes to distributing the estate according to the Will, it may be difficult to work out exactly which charity you intended the funds to go to. To avoid this problem make sure your Will states the charity's registered office and charity number. You can also include a clause in your Will specifying that the gift should be directed to any organisation that amalgamates with the original charity.

Residue of the estate

The second problem can occur where the charity has been left an undefined amount in your Will, such as the residue of your estate. This can lead the charity's officers hassling the executors, querying deductions such as legal fees and in extreme cases challenging the distribution of your estate in Court. To avoid this problem leave specified amounts of cash or assets to your chosen charities rather than the amount left over after other gifts have been made and any tax paid.

Life in the Cloud with Fran Holmes - SageOne

BKN — Fri, 13 Apr 2012 01:07:47 GMT

So, my name is Fran Holmes and I am the Business consultant for SageOne. My head is always in the clouds and I live for online, as I believe that it is the future, although I do catch myself feeling like I am in the film "Terminator" and at any moment will see Arnie running after Linda Hamilton in the background!

It has been three months since I started this role as the dedicated person for SageOne in the accountants’ and bookkeepers’ community and it has been fantastic. I have learnt so much about both the product and also about how accountants like to work. SageOne has been on a journey from conception to reality, and has evolved to become a very popular application. We have hundreds of practices ranging from sole traders to mult-officeall winning new business for accounts and payroll. I aim to act like cupid and match up our wonderful end user customers with the accountant and bookkeeper community as well as to promote the service through accountants who are rather vanilla with the idea of cloud. Trust me, it’s not scary!

The great thing about SageOne is that it is so simple. I mean that quite literally, we have listened to customers from the world of the sole trader and small ltd company and delivered a product that eases the pain of bookkeeping. In my experience, they would rather concentrate on running their businesses than running their books.

So what do they typically do at year end? Bring a box full of receipts to their accountants, usually on the very last day that they can, after all, that’s what accountants are for right? So if I were an accountant, what would I rather do? Sift through a pile of paperwork, sorting into date order, type, expense etc. Enter all that data manually into some form of accounts, and then do it all over again with another 12 customers? No thanks, I’d rather use my awesome accountancy powers to figure out how much tax to save someone, and be branded a hero, and go home feeling like I could conquer the world, and not that the world could conquer me.

So, what’s the answer I hear you cry? SageOne, it’s the cure for the common business accounts and payroll, it will save you so much time, add protection from HMRC and let you do those things that you studied so hard for, like provide comprehensive business analysis, spot errors early, help your clients stay compliant and most importantly of all, turn your practice into a paper-free haven, where all records are safe, on time and legit! But let’s see what one of my recent customers had to say about SageOne, so that it’s not just my word you hear:

"I must say that I have been pleasantly surprised with the system, particularly its simplicity, which is important for the target clients that I have in mind for this"

That was from Alan Newland of Newland & Co [ www.alannewland.co.uk ], who was rather sceptical on the first conversation, but had that to say once he became part of the new Sage Online Accounting Programme (SOAP), and is now a full SageOne convert. Other things customers love are the 24/7 telephone support in the UK, not to mention the frequent product updates for RTI, payroll year end, online VAT…. No installing, it just comes to you via SageOne.

Finally, it’s all here through the BKN network, all the answers to all the questions except the meaning of life, apparently that’s 42 although I cannot remember where I heard that? So talk to BKN, talk to me, if its cloud you want, we can deliver the goods, and I look forward to seeing you up there.

You can call me free on 0800 092 8091, email me at francesca.holmes@sage.com and contact me on Twitter @franholmessage. I would be happy to create a Sage One account with you on the phone, demo the product, or just talk it through if you have any questions. You can be up and running with Sage One in under 10 minutes.

ISA Rules for Clients Emigrating from the UK

BKN — Fri, 13 Apr 2012 00:35:16 GMT

Book-keepers Question: I have a client who is about to move abroad, for what they intend will be a permanent relocation. Can they continue to contribute to tax-free ISAs in the UK?

BKN Answer: To open an ISA your client must be resident and ordinarily resident in the UK for tax purposes. This broadly means that they normally live in the UK. There are exceptions for members of the military and government employees who are sent to work abroad. Once they have emigrated, they will not be permitted to open a new ISA, or contribute to ISAs already held. Also the interest paid on the ISAs they already hold may be taxable in the country they will be living in.

Untaxed Rental Income

BKN — Fri, 13 Apr 2012 00:28:07 GMT

Book-keepers Question: One of my clients bought an investment property around 6 years ago and after expenses they have a surplus of about £250 per month. They have never declared this income or paid tax on it. How do I go about helping my client put this right?

BKN Answer: The Taxman is running a series of campaigns to encourage people to come clean about unpaid tax, the latest of which is aimed at people who sell through online markets. Although this is not your clients situation, they can make a disclosure of their rental profits. They will have to work out how much tax they owe and the interest due on that late paid tax. There will also be a penalty to pay, but as they are volunteering the information without being asked, the penalty should be minimal. The penalty could possibly be about 10% of the tax due.

Have you heard about PAYE Real Time Information (RTI)

BKN — Fri, 13 Apr 2012 00:22:24 GMT

On 11th April 2012, HM Revenue and Customs announced that Real Time Information (RTI) was moving a step closer as their pilot scheme was launched, with the first of 10 volunteer employers submitting their RTI return.

RTI is being introduced to assist employers, pension providers and HM Revenue & Customs (HMRC) to administer their PAYE. Under RTI, employers and pension providers will inform HMRC about their PAYE payments due at the time they are made – as opposed to only at the end of the year, when they submit their P35 and assoicated year end PAYE returns.

Most employers will join RTI from April 2013 and all employers will be using the RTI service by October 2013.

For more information about RTI, please use our links below:

Sage view: http://www.sage.co.uk/why-sage/paye-real-time-information.html?gclid=CKXTkpCDsK8CFY8PfAodHFW_GQ

HMRC view: http://nds.coi.gov.uk/clientmicrosite/Content/Detail.aspx?ClientId=257&NewsAreaId=2&ReleaseID=424066&SubjectId=36

VAT Changes

BKN — Thu, 05 Apr 2012 19:28:41 GMT

The Government has decided to tidy up some of the areas of VAT law where a different rate of VAT may be charged on very similar goods or services.

Food & drink

All food eaten on the supplier's premises; 'eat-in' purchases, are subject to standard rate VAT (20%). However, the consumption area for the food may be a communal area shared with other retailers, or tables and chairs on the pavement, neither of which are technically on the retailer's premises. In these cases the rules are to be redefined so that such areas adjacent to the retailer's premises will count as 'eat-in' areas, and the food sold to be eaten there will be standard rated.

Take-away food is subject to zero-rate VAT, unless it is hot food designed to be eaten straight away such as fish and chips. Some retailers argue that the food is only hot because is has been freshly baked, so charge zero-rate VAT. The law is to be clarified so that all hot food to take-away, other than freshly baked bread, will be subject to standard rate VAT.

Soft drinks designed to rehydrate, slake thirst or give enjoyment, are subject to standard rate VAT. However, some sports drinks are claimed to have nutritional values (e.g. protein enhancers), rather than the usual thirst-quenching properties of a soft drink. Hence the manufacturers have zero-rated those drinks. The law will be changed to ensure that all sports drinks are standard rated just like other soft drinks.

Land and buildings

The letting of a discrete area of land can be exempt from VAT, if the owner has opted to exempt the land or building. Self-storage lock-ups can fall into this exemption. However, other storage facilities where the customer does not have right of entry to a discrete area cannot be exempt from VAT. The law is to be changed to ensure that self-storage facilities are subject to standard rate VAT, whether or not the owner of the facilities has opted to exempt the whole building from VAT.

Miscellaneous items

Rental of hairdressers' chairs have previously been exempt from VAT in certain cases, but will now always be subject to standard rate VAT.

Sales of caravans will be subject to standard rate VAT, but residential caravans designed and constructed for year-round living will be zero-rated for VAT.

Approved changes to listed buildings are zero-rated for VAT, but repairs to those buildings are standard rated. This encourages the building owners to alter their protected buildings rather than repair them. The law will be changed so all building materials and building services supplied for alterations of listed buildings will be standard rated.

These changes will generally take effect from 1 October 2012, but where the contract for work on a listed building had been signed by 21 March 2012, the zero rate will continue to apply.

Stamping out unnecessary expenses with Sage One Accounts

BKN — Fri, 06 Apr 2012 12:17:59 GMT

Spend your money wisely and stamp out any unnecessary expenses!

Why waste money on buying stamps to post sales invoices, credit notes and statements to your customers when you could email them using Sage One Accounts?

As of the 30th April the price of a first-class stamp will increase to 60p, while a second-class stamp will cost you 50p - a sharp rise from 36p. Although this might seem like a small change, if you send 25 invoices a week this equates to around £780 a year alone on first-class stamps. Add on the cost of posting out customer statements and any credit notes you send and this quickly becomes a staggering £1000+…… just on stamps!

What if you could send all of these documents to your customers for free? You could save a nice little sum of money right!

With Sage One Accounts you can email sales invoices direct to your customers. You can also email credit notes and statements direct. This isn’t just quicker and easier but it’s also more eco-friendly.

But that’s not all Sage One can help you with!

From the 1st April 2012, HMRC are now requiring virtually all UK VAT registered businesses to submit their VAT returns online.

As an online accounting service, Sage One Accounts will calculate your VAT return based on the information you enter. It then enables you to submit your returns online, direct to HMRC.

Using Sage One Accounts to meet HMRC’s requirements means you can avoid any possible complications by submitting your returns using the right process.

It also helps you to ensure the returns you submit are accurate and in the right format.

And of course the money you’ve saved on stamps could come in handy in making any payments for your VAT liability…..