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Taking stock


12/12/2016 by Sarah Powers

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As another year comes to a close, we take stock of the achievements, new starters and those we have said farewell to. It has been an incredibly busy and positive year for Poole Waterfield and we have delivered some great results for our clients. It is also really encouraging how much new business we have won and the number of quality clients we have welcomed this year. Long may it continue!

This year has not been without its surprises and challenges. Political events both at home and abroad have created a level of uncertainty we haven’t seen since the days of the banking crisis. But our role is to stay positive and help our clients overcome challenges and, if possible, turn them into opportunities.

2016 has given Poole Waterfield an opportunity to build on our team, introduce new talent into our business and deliver more and better services.

Here are some recent highlights:

Awards

Poole Waterfield  was again shortlisted for the British Accountancy Awards Independent firm of the year  for our region. This was the second year running that we have been recognised in this way.

The British Accountancy Awards are regarded as the industry's most prestigious accolades. They pinpoint professional development and highlight those that have demonstrated excellence in their profession during the last 12 months.

Welcoming Sam and Kirsty

We're pleased to have welcomed Sam Scrivens to the team, who has joined us on our apprenticeship scheme; Sam is working within an administration capacity for the business. Sam's skills are already proving to be a great asset to the team as we continue to grow and meet the demands of busy periods. Sam is great at baking too, which is a real bonus! Poole Waterfield has always seen apprenticeship schemes as integral to our business model and vital to support young professionals at the start of their working life.
 
We also welcome Kirsty Dixon as one of our newest accountants following the departure of Karl Price, who left after ten years with us.  Kirsty, like a number of our team, is training towards ACCA qualification.

Stephanie Churchill   

2016 saw Stephanie join us as a tax consultant. We have known Stephanie for many years and are really excited that she is now part of the team. Stephanie is a hugely experienced, talented and highly qualified tax advisor who has already added to the support we can provide to clients with tax planning advice.  

Thrill Seeking

The world of accountancy is not always as dull and lacking in excitement as some might believe – at least not as far as Katie Brookes is concerned! Katie is one of our audit managers and in November she literally took the plunge and sped down a zipwire in Snowdon at 119mph. Click here to view Katie’s exploits.

Further afield
As we all know, we end the year with a new Prime Minister and Chancellor. Our first real glimpse of Philip Hammond in his new role during was the Autumn Statement in November. We have a summary of this below. Although Mr Hammond’s assessment of the UK’s economic outlook was far from upbeat we still believe that there is much to be positive about for business in 2017. 

David Gibbens added: "At Poole Waterfield we  appreciate  the demands of running a business and how these  day-to-day pressures can detract from business planning and getting the strategy right – stemming business growth. Whether its acquisitions, investment, efficiencies or just finding the right direction; we're helping our clients to plan and make 2017 a success."

Poole Waterfield offers clients help with strategic  business planning in addition to accountancy and tax advice – please feel free to call David Gibbens or a member of the team on 01384 455505 for more information.

 
Autumn Statement 2016 summary
 
 
 
November 2016

GETTING THE UK “MATCH FIT” FOR BREXIT 

The Chancellor Philip Hammond announced that his first Autumn Statement will also be his last. In future, the main Budget announcements will be made in the autumn rather than the spring. We were not expecting that many tax announcements and many that were made we already knew about. He could not afford too many giveaways expects the economy to have a bumpy ride during the BREXIT transition.
 
There will still be a Budget next March but thereafter the annual Budget will be in the Autumn to allow longer consideration of the announcements and draft legislation before enactment the following summer.

KEY TAX ANNOUNCEMENTS:
  • Personal allowance to increase to £11,500 in 2017/18, rising to £12,500 by 2020/21
  • Higher rate tax threshold to increase to £45,000 in 2017/18, rising to £50,000 by 2020/21
  • National Insurance threshold to be raised to £157 a week for employees and employers
  • Corporation tax rate to reduce to 17% in 2020
  • Business tax “roadmap” to continue, in particular new rules for company losses
  • Insurance premium tax to increase from10% to 12% from 1 June 2017
  • More anti-avoidance measures, in particular, a new VAT flat rate percentage for “limited cost traders”
 
HELP FOR THOSE JUST ABOUT MANAGING (JAM)
 
The Chancellor made a number of announcements that were intended to help those families that a just about managing, given the acronym - JAM. Raising the personal allowance to £11,500 and higher rate threshold to £45,000 will mean they pay less income tax and keep more of what they earn.
 
This group will also benefit from the increase in the National Living Wage to £7.50 an hour and the changes to Universal Credit.
 
The Universal Credit taper rate will be cut from 65% to 63% from April  2017 which will mean that fewer benefits will be clawed back as claimants’ income increases. The planned reductions in the overall benefits caps will however go ahead.
 
CORPORATE AND BUSINESS TAX CHANGES
 
Many of the corporate tax changes had already been announced and are set out in the business tax "roadmap" which details the government tax strategy for the life of this Parliament and beyond.
 
The currently 20% corporation tax rate is planned to fall to 19% from 1 April 2017 and then to 17% on 1 April 2020. The government is committed to keeping the UK corporate tax rate the lowest in the G20 and there is talk of a rate as low as 15% in the future.
 
The Chancellor raised concerns that there continues to be a rise in tax-driven incorporations as there are still tax savings compared to unincorporated businesses operating at a similar level of profit. That may suggest that the government is still considering the introduction of a new “look through entity” suggested by the Office of Tax Simplification so that the tax treatment will be the same, thereby creating a level playing field.
 
The new flexible corporate tax loss rules announced in the spring budget have been subject to consultation and will go ahead from

1 April 2017

CAPITAL ALLOWANCES

From 23 November 2016 to 31 March/ 5 April 2019, businesses will be entitled to a 100% First Year Allowance (FYA) for the cost of installing electric charge-point equipment for electric vehicles. This measure is intended to complement the 100% FYA available for low CO2 emission vehicles and to encourage their uptake.
 
HIGHER RATE TAX RELIEF FOR PENSIONS CONTINUES
 
There has been much speculation that the government would further limit tax relief for pension contributions by removing higher rate tax relief. That measure would save the country £34 billion in tax but the only change announced concerns a new lower limit on amounts that can be saved in a pension when individuals have started drawing down from their private pension.

Currently the net effect of pension tax relief for a higher rate taxpayer is that saving £10,000 in a pension costs £6,000. The taxpayer pays £8,000 into their pension and the government tops this up by £2,000 with a further £2,000 deducted from the individual’s income tax liability, reducing the net cost to £6,000. For additional rate taxpayers the net cost would be just £5,500.
 
Remember that there is currently an annual pension input limit of £40,000 which caps the combined contributions by an individual and his or her employer. For those with high income this is tapered and can be as low as £10,000.
 
One new pension restriction that was announced was a measure to limit pension “recycling”. Those individuals who have started drawing down their personal pension will in future only be able to reinvest up to £4,000 in their pension.  Please contact us if you want to discuss pension planning further.
 
SALARY SACRIFICE RULES TO BE TIGHTENED UP
 
Many employers now provide flexible remuneration packages that allow employees to give up some of their contractual salary in exchange for benefits in kind. This can have the effect of saving tax and national Insurance contributions for both the employee and employer, particularly where the benefit provided is exempt from tax.
 
These tax and NIC advantages are to be withdrawn from 6 April 2017. Arrangements involving pensions, childcare, Cycle to Work and ultra-low emission cars will be excluded; existing arrangements will be protected for a transitional period until April 2018, and existing arrangements for cars, accommodation and school fees will be protected until April 2021.
 
The Chancellor has announced a wider review of the taxation of benefits, with the intention of making this area ‘fairer and more coherent’. This appears likely to have a significant effect on any employee who is in receipt of benefits from their employer.
 
OTHER EMPLOYEE BENEFIT CHANGES

MAKING GOOD

An employee who repays to their employer, or ‘makes good’, the cost of a benefit, avoids a tax charge. As previously announced, from April 2017 such making good will have to take place by 6 July in the following tax year if it is to be effective.
 
CHANGES TO TERMINATION PAYMENTS TO GO AHEAD
 
As announced in March, from April 2018 termination payments over £30,000, which are subject to Income Tax, will also be subject to employer’s NIC. Tax will only be applied to the equivalent of an employee’s basic pay if their notice is not worked. The first £30,000 of a genuine termination payment will remain exempt from tax and NIC.
 
“ABUSE” OF THE VAT FLAT RATE SCHEME
 
The VAT flat rate scheme is a simple scheme that enables small businesses to calculate and pay their VAT based on a flat rate percentage of total takings rather than deducting input tax on purchases and expenses and deducting that from total output tax on sales in the period. HMRC believe that the scheme is being abused by certain traders who have minimal costs who charge 20% VAT to their customers and then pay a lower percentage over to HMRC.
 
The flat rate percentage varies depending on the nature of the trade, ranging from 4% for food retailers up to 14.5% for IT consultants and labour only construction workers. A new 16.5% rate will apply from 1 April 2017 for businesses spending less than 2% of their turnover or less than £1,000 per year on goods, excluding capital goods, food, vehicles and fuel. Any business affected will almost certainly be better off returning to the normal VAT system with effect from that date. If you are currently using the flat rate scheme please contact us to check whether this change is likely to affect your business.


 
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Category: Latest News Author: Sarah Powers

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