ADVISORY FUEL RATES

The advisory fuel rates should only be used in the following circumstances:

• to reimburse employees for business travel in their company cars
• to require employees to repay the cost of fuel for private travel

Advisory fuel rates (per mile) from the 1 December 2014 are:

These are not to be confused with the mileage payments for business travel.

The current rate per business mile for a car is as follows:

• For Tax purposes – 45pence for the first 10,000 business miles in a tax year, then 25 pence for each subsequent mile.
• For National Insurance Contribution (NIC’s) purposes – 45 pence for all business miles.

The current rate per business mile for a motorcycle is 24 pence for both tax and NIC’s purposes and for all business miles.

If you travel ?as a result of running your business (other than home to work) and:

• Are unsure on what you can claim
• Are considering your options regarding the company purchasing a vehicle
• Want to understand the rules around company car benefits in kind
• Are unsure whether to lease or buy a vehicle
• Or anything else associated with business travel.

Please contact business works so that we can ensure the advice you are given is specific to your circumstances.

Call us on 0113 2864486

You can only charge VAT if your business is VAT registered.

It can be charged on the following:

• Business Sales- when you sell goods and services
• Hiring or loaning goods someone
• Selling business items
• Commission
• Items sold to staff for example canteen meals
• Business goods used for personal reasons
• Non sales including part exchanges or gifts

VAT registered businesses must charge VAT on all of the goods or services that they sell. They may reclaim any VAT they’ve paid on business related goods or services. They must also file a VAT return which is usually due every 3 months. This details the amount of VAT you’ve charged and the amount of VAT you’ve paid. If the amount of VAT you have charged exceeds the amount of VAT you’ve paid, you have to pay the difference to HMRC. If you’ve paid more VAT than you have charged, you can reclaim the difference from HMRC.

You must charge the correct rate of VAT which is usually 20% though some items have a discounted VAT rate. You can find out more about this by following this link: https://www.gov.uk/vat-rates . To work out a price including the standard rate of VAT multiply the excluding price by 1.2. To work out a price excluding the standard rate of VAT divide the price including VAT by 1.2.

For prices which are discounted VAT ought to be charged on the discounted price rather than the full price. Prices that include money off vouchers no VAT is due if given away for free at the time of purchase, if they were not free VAT is due on the price charged.

Goods and services VAT exempt must not have VAT charged on them or be included in your VAT records. If you buy or sell an exempt item you should still record the transaction in your general business accounts. Examples of exempt items include- insurance, postage stamps or services, health services provided by doctors.

Businesses that sell only VAT exempt goods and services don’t have to be VAT registered. If you start selling items that aren’t exempt you must register for VAT within 30 days, otherwise you could face penalties.

For more information on VAT please follow this guide:

https://www.gov.uk/vat-businesses/how-vat-works

When you are employing new people it is important that you follow the rules and regulations. According to the government, there are six key things you ought to know when employing staff for the first time.

1.  When deciding on how much to pay someone you must ensure that the rate is at least the minimum wage. The current hourly rates as of October 2014 are

• Aged 21 and above £6.50
• Aged 18-20 £5.13
• Under 18 year old employees are entitled to £3.79
• Apprentices are entitled to £2.73.

If you are unsure you can use the Wage calculator: https://www.gov.uk/am-i-getting-minimum-wage .

2.  You must check that the candidate for the job is eligible to work in the UK. https://www.gov.uk/legal-right-work-uk
3.  If you work in a field that requires a DBS check you must ensure that you apply for them for every employee. Formerly known as a CRB check, a DBS check is a ‘Disclosure barring service check’. Fields that require these checks include working in security, with vulnerable people, working with children or healthcare etc. To get a DBS check the employer must:

• Get an application form
• Fill in and return form along with documents providing their identity
• If the application is successful the DBS will send the applicant a certificate.

To find out more information follow this link: https://www.gov.uk/disclosure-barring-service-check

4.  You will need employer’s liability insurance as soon as you start employing people. Employer’s liability insurance will help you pay compensation if an employee is injured or becomes ill because of the work they do for you. You could face fines of £2500 everyday you are not properly insured. You can also be fined £1000 if you do not display your Employers Liability Certificate or refuse to make it available to inspectors.
5.  If you are employing someone for more than 1 month you must send details of the job including Terms and Conditions in writing to your employee. This must include the business name, employees name, job title, description of work and start date, how much and how often they will be paid, hours of work, holiday entitlement, the location of work etc. For more advice on employee contracts follow this link: https://www.gov.uk/employment-contracts-and-conditions/written-statement-of-employment-particulars
6.  You must inform HMRC by registering as an employer. You can do this up to 4 weeks before you pay your new staff.  https://www.gov.uk/register-employer

The previously successful but short lived ‘Green Deal Home Improvement Fund’ reopened on the 10^th of December with an initial £30 million available for more home improvements. The government have pledged that a further £70 million will be released for the fund in February. The fund allows householders to apply for free cash to pay for home improvements in the hope of making them more energy efficient.

You can get up to £1000 towards the cost of installing any 2 of the following:

• A condensing gas boiler
• Double or triple glazing in replacement for single glazing windows
• Energy efficient external doors
• Cavity wall insulation
• Floor or flat roof insulation
• A replacement warm air unit
• Fan assisted storage heaters
• A waste water recovery system

You can get up to £500 more if you apply within 12 months of buying a home.

To be eligible

• you’re improving a domestic property in England or Wales that you own or live in
• you have either a Green Deal advice report or an Energy Performance Certificate (EPC) that’s less than 2 years old
• the improvements you’re applying for are covered by the scheme and recommended in your EPC or Green Deal advice report
• you use a Green Deal provider or installer registered with the GDHIF

How to Claim

• Get a Green Deal assessment or an EPC for your property.
• Get and agree a quote from a Green Deal installation company that’s registered with the Home Improvement Fund.
• Apply for a Home Improvement Fund voucher before you start the work.
• Complete the work.
• Ask your Green Deal provider or installer to fill in the rest of the voucher.
• Follow the instructions on the voucher to make your claim. You must do this before the expiration date on the voucher.

Energy and Climate Change Secretary Ed Davey says: “The best way people can cut their energy bills, this winter and every winter, is to improve their homes so that they leak less heat and use less energy. That’s why we’ve increased the funding available for the Green Deal to help even more people start saving money sooner.”

For more information on how you could start reducing your energy bills follow this link:

https://www.gov.uk/green-deal-energy-saving-measures/overview

The Employment Appeal Tribunal ruled that employees must take overtime into account when calculating holiday pay.  This could potentially benefit up to five million employees.

Workers who regularly participate in overtime are likely to see an increase in their holiday pay, as non-guaranteed overtime they would otherwise have worked must now be included up to the first four weeks of holiday taken.

Businesses are likely to take steps to minimise the financial impact for themselves. They may alter contacts to include ‘voluntary’ overtime as opposed to ‘non-guaranteed’ or businesses may consider using part-time agency staff to cover overtime. This may have a negative impact in the long run for workers, despite their increased holiday pay.

Six years ago HMRC took steps to cut some of this red tape on travel expenses. Since then employers can now pay tax and NI free meal allowances, so called benchmark subsistence payments to employees, and these can be completely ignored for P11D and self-assessment purposes.

The benchmark rates include:

• £5 for breakfast if the business journey starts before 6am
• £5 if the employee spends more than five hours away and buys one meal
• £10 if they’re out for more than ten hours and they buy two meals
• £15 if they are out beyond 8pm and buy an evening meal

Despite inflation running at around 3% per year the rates haven’t increased since they were introduced. The maximum payment per day remains at £25. Paying HMRC’s benchmark subsistence rates reduces your tax admin. Up to £25 per day can paid irrespective of whether the employee spends this on food or not. Whatever they keep is tax and NI free, meaning that it’s a cheap way for you to increase their pay.

The government is encouraging businesses to employ apprentices as they play an important part in its employment policy. As an incentive to employers the government pays cash incentives and provides free advice for employers who take on trainees. Also from the 6^th April 2015 if you employ someone of the age of 20 years or younger you will not have to pay employers National Insurance Contributions on their wages.

This also includes exemptions for Scholarship Income, further legislation links the exemption to payments for trainee workers as well. Employers can pay an employee up to £15,480 tax and NI free for periods where they are undergoing training at an educational establishment for their job. Including colleges, universities and educational institutes which are open to the public.

To qualify for this tax break the training must last for at least one year and the worker must attend for at least 20 weeks. If you decrease their pay for working time and increase it for periods of training you can cut the cost of employing them by up to 10%.

Currently when a business issues an invoice showing VAT calculated on a discounted amount but the discount isn’t taken up by the customer you don’t need to change the VAT amount.

For most customers that are VAT registered it is merely cash flow that is affected, as they can reclaim VAT paid on purchases anyway therefore it doesn’t matter to them how much VAT they are charged. However, for unregistered customers or those who are VAT exempt or partially exempt there’s a significant saving. Therefore those types of customers are likely to buy from a seller who offers artificially large prompt payment discount.

However changes are being made which will alter VAT calculations on discounted amounts. For supplies made after the 1^st of April 2015 you can choose to issue an invoice showing the VAT on either the full or discounted amount. If the customers qualifies for the discount and you have charged the full VAT you must issue a credit note. But if you have charged VAT on the discounted amount and they don’t qualify for the discount you will have to issue another invoice for the extra VAT only.

Think you are safe from an HMRC enquiry?… Think again

How does HMRC select investigations?

Click here to download the document to find out more.

The risk of an HMRC enquiry is a reality.

Individuals and businesses can be selected for investigation because they fall within a campaign category, a geographical task force area or because their income or net profit ratio appears too low.

Our tax investigations package offers businesses and individuals protection to ensure that in the event of an HMRC enquiry all your professional fees are provided for.

Our fee protection package offers:
• Up to £75,000 of accountancy fees
• Full representation to HMRC on your behalf including handling all correspondence and interaction, including attending any 1-1 meetings
• Comfort and peace of mind that we will fiercely defend any enquiry into you or your business

Business Works UK Ltd are delighted to have won two awards:

Manufacturing Accountancy Team of the Year – UK

Business Advisory of the Year – West Yorkshire

The awards are handed out solely on merit and are awarded to only the most deserving businesses who have been nominated by their clients, peers and industry experts, for their outstanding work over the past 12 months.

Jo Tomlinson, MD of Business Works said “I am delighted that our team has been recognised for their hard work, and am honoured that Business Works has received these awards.  We work very hard to provide clients with a service better than they expect, always striving to exceed expectations.  We do much more than just the numbers, we are here to hold our clients hand in all areas of their business growth and development.”

Speaking about the awards, coordinator, Siobhan Hanley said: “Finance is without a doubt one of the biggest and most widespread sectors we cover at Acquisition International, making competition for these awards particularly strong.

“Not just any business can be nominated for one of these awards and only the most forward- thinking, committed and results-driven firms, who have consistently produced standout work will walk away with one of our prestigious trophies.”

Thank you to everyone who took their time to vote for us – we really do appreciate it.