Patrick Murphy, chartered financial planner at the company says, ‘We find a lot of small business owners are relying on the release of capital from their business to fund their retirement. ‘Unfortunately, this is pure fantasy for most small business owners as they do not have a plan in place, and expect the sale to ‘just happen’. This ‘ostrich approach’ is a risky tactic.’
Murphy adds that small business owners have a lot on their plate, particularly in the current economic environment, and all too often succession planning slips down the to-do list.

‘However, it’s never too early to plan an exit strategy from your business. This means the business will be best-placed for a smooth transition, will achieve its value potential and will allow the current owners to leave the business on their own terms and with financial security,’ he adds.

Succession planning can form part of a start-up’s business plan, encouraging entrepreneurs to crystallise their objectives and consider what factors would future-proof the business for sale or transfer. Typical reasons for business sales or transfers not succeeding include the business owner ‘being’ the business and it not being able to function without them, the business being reliant on a few large clients with an undiversified revenue stream, and there being a non-transferable lease on business properties.

For family-run businesses, which account for 66 per cent of UK small businesses, there can be additional pressures and emotional factors at play, making it all the more important to draw up a formal, strategic planOnly 5-15 per cent of family businesses reach the third generation.

Murphy continues, ‘By creating a realistic exit strategy, operational improvements can be identified, potential weaknesses addressed, personnel improvements made and business valuations are more easily ascertained. ‘By ensuring the business is robust and doesn’t fall foul of any of the usual snagging problems, and by achieving the best valuation possible the business owners are in a better position to effectively plan their retirement income stream.’

If you need assistance contact us. You may also like to join us at our forthcoming event at Chewton Glen, Hampshire on the 9th July where we will discuss how to go about this in more detail.  Further information can be found here at Eventbrite.

Article courtesy of www.smallbusiness.co.uk

The high volume of calls – around 300 per day – clearly demonstrates increasing  public awareness following Parliaments concerns and the resulting media coverage on the subject. However the number of calls does not necessarily lead to increased yields.

In many cases, the calls can lead to unnecessary investigations. A case in point is 2006/07, when HMRC recouped just £2.6m from calls made to the hotline, rather than the £32.5m originally hoped for. Either way this

Article courtesy of Accountancy Age

The clerk was transferring 64.20 euros when he dozed off with his finger on the keyboard, resulting in a transfer of 222,222,222.22 euros. His supervisor was fired for allegedly failing to check the transaction. But judges in the state of Hesse said she should have only been reprimanded.

His 48-year-old supervisor, an employee at the bank since 1986, told the court she had not noticed the error and approved the transaction.

Another colleague spotted the mistake later and corrected it. The bank accused the supervisor of not even verifying the clerk’s work.

But the court heard that on the day of the erroneous transaction, she had checked 812 documents for mistakes, with most taking just over a second of scrutiny.

The judges ruled that there had been no malicious intent on her behalf, and that she should have received a warning. As a result, they ordered the bank to reinstate the supervisor, saying her work contract could not be terminated.

Bizarrely there is no comment as to whether the clerk was fired or not, presumably the words “your fired” did rein down.

RTI came into effect in April this year and larger employers in the UK have been asked to switch to the scheme that is designed to be much more flexible and efficient than the older system. With RTI in operation, HRMC can keep a closer track on how much tax staff should be paying and see any changes to employees’ circumstances at an earlier point, in theory making end of year tax processes more accurate.

However, in order for it to work, employers need to be onboard and the exact number of non-compliant payroll schemes will be only be revealed by the Revenue at the end of this month.

The rollout of RTI is being staggered in order to make the transition as smooth as possible and while some of the businesses that have not yet adopted it are not required to do so before October, HRMC believes that many of the non-compliment firms are understood to be businesses that were required to make the switch over from the beginning of this current tax year.

The authority also states that pilot employers that did not submit a return by May 19th could be subject to a PAYE end of year penalty. If you require assistance in this matter please do get in touch, with us.

Guest Speaker – James Grazebrook OBE.
James set up Halyard (M&I) Ltd in 1979 with two backers and £6,000 he saved working in the Middle East, he sold the company in 2011 for a seven figure sum. James ensured Halyard is uniquely placed in marine engineering by maximising opportunities in the reduction of engine noise and vibration. Halyard’s innovation in The Science of Silence is recognised by two Queen’s Awards for Innovation and a self supporting business model that no longer relies on James’ direct entrepreneurial input. James’ personal contribution to the UK’s marine industry was acknowledged with an OBE in 2012.

Nicky Matthews ACIM – owner of Media Box, the new agency with big ideas. Passionate about small business, Nicky offers a refreshing look at opportunities from a marketing point of view. With 25 years of experience across multiple sectors Nicky gives practical, proactive advice and highlights common marketing pitfalls, encouraging businesses to take stock. Nicky has also led a national award winning children’s charity. www.mediaboxmarketing.co.uk

Kevin Kennard Dip PFS – owner and manager of Clinton Kennard Chartered Financial Planners with business partner Mark Clinton. Winning national awards for excellence and high standards in professionalism the Clinton Kennard team provide a transparent approach to financial advice. Kevin believes the key to sound financial planning lies in translating complex investment, pension and trust planning ideas into straightforward solutions. www.clintonkennard.co.uk

Sophie White CTA – owner and manager of Total Tax Limited: a firm of Chartered Tax Advisers and Accountants with 8 specialist staff, now in its 10th year of business. Sophie started her career in tax at HMRC but jumped the fence early on, quickly progressing to Tax Partner of an award winning top 50 London firm at the tender age of just 27. Sophie has honed her commercial acumen by advising business owners in all areas of taxation for over 20 years and professionally there is nothing she hasn’t seen! www.totaltaxlimited.co.uk

Why attend?
The event will provide Business Intelligence direct from experts in marketing, finance, taxation, engineering and manufacturing. Their own “stories from the sharp end” of business will show you how to get it right first time. You will come away with practical advice on how to handle many tough business decisions.

Who should attend?
Aimed at business owners striving for excellence in business whether starting up, established or seeking an exit.
When, and where?
Date: Tuesday 9 July 2013
Time: 5.00 pm—7:30 pm (drinks and canapés)
Cost: £15.00
Venue: Chewton Glen Hotel New Milton Hampshire BH25 6QS  www.chewton glen.com

Agenda:
5:00 pm: Registration and networking opportunity
5:30 pm: Speakers present
7:00 pm: Breakout; discuss key topics
7.30 pm: Round up and finish

However HMRC is rapidly recruiting in their affluent compliance team unit which deals with the personal tax affairs of the UK’s richest people (typically those with assets of between £2.5m and £20m).

One of the key characteristics that will be targeted by the affluent compliance team is “wealthy people who fail to file their self assessment return on time”.

Behind all of this enforcement and compliance activity, is HMRC’s Connect computer system.  Despite costing HMRC £45m, Connect delivered £1.4bn of additional revenue by 2011. It uses a mathematical technique to search previously unrelated information and detect otherwise invisible ‘relationship’ networks. Using Connect, HMRC sifts through information on property transactions at the Land Registry, company ownerships, loans, bank accounts, employment history, voting and local authority rates registers and compares with self-assessment records to spot taxpayers who might be under-declaring or not declaring income.

Last year Connect made links between tax records and third party data from hospitals, pharmaceutical companies, insurers and even gas SAFE registrations. DVLA records and the shipping and Civil Aviation Authority registers help identify owners of cars and planes who declare income that the computer suggests cannot support such purchases.

Several individuals were caught out after appearing on the Channel 4 television programme ‘My Big Fat Gypsy Wedding’ having spent thousands of pounds on lavish family weddings. HMRC queried how could they afford it and of course they could not.

As a result of its analysis work HMRC’s also recently announced that it had identified more than 200 UK accountants, lawyers and other professional advisers who advise on tax avoidance structures. These individuals will come under intense scrutiny.

Exactly how are those accountants are going to be dealt with has yet to be emerge. Will it be just the accountants, or will other clients of those accountants who are not part of the tax scheme also be scrutinised?

Whatever happens, HMRC’s current ‘dash for cash’ is likely to bring unwelcome attention to a much broader groups of taxpayers and advisers. We have been warned.

This article is an edited version from Accounting WEB which you can follow in full through the link.

 Karren Brady (Vice Chair of West Ham United FC) a woman in business.

I heard Karren speak at the Salisbury Big Business event in April. I attended the event just to hear her speak and I was very glad I did.  She’s an eloquent and motivational speaker, has a clear business vision, obviously works hard and is very determined. She is also distinctly feminine in a male dominated profession. 

I was left feeling a little queasy though with the number of anecdotes in her speech that relied on a “man bashing” punch line.  Usually the man in question was too dumb, or too unsophisticated, perhaps too Neanderthal to combat Karren’s sharp put downs. Although the jokes were funny, and had the mixed gender audience laughing in the aisles, I wondered how many of the men felt annoyed at the cheap laughs at their expense.

You know where this is leading but I’ll make the point anyway – if a bloke had stood up and littered a speech on his business acumen with similarly dismissive comments of the girls in his organisation, he’d have been booed off the stage. Or at the very least been subject to pointedly disapproving looks during the obligatory after speech networking – this is middle class England after all.

Actually, Karren Brady was later subject to a put down from a man, although completely unintended as I later found out.  Salisbury’s Mayor, Councillor John Collier, took the podium after Karren to thank her for her tour de force. In so doing he managed to mangle his words and infer that she had not told us anything new but he hoped the audience had appreciated her enthusiasm. On leaving the event I shook his hand and asked “I hope you don’t regret saying Karren had nothing new to tell us?”, he had the good grace to flush and say ” I didn’t mean it like that…you know  what I meant!”

Certainly the Mayor’s slip went unnoticed by the audience as there where many there who were clearly huge Karren Brady fans. During the Q&A session she was asked to comment on a range of issues facing women in business, here are some I can remember:

Did she think the government had gone far enough in the recent childcare tax relief announcement?  Answer – In short, no there is still a long way to go, but each step helps.

How does she manage her work/life balance? Answer – she splits her week between London and home, from Thursday through the weekend she is at home for her family

How many women does she employ? Answer – Obviously it’s an all guy team! But Karren said 60% of the off pitch staff are female.  (I have checked this in so far as I can and of the 6 directors of W H Holdings Ltd which owns the Club Karren is the only female and the Club’s website show only 3 females make up the of 14 “executive” positions.)

How does she encourage women to enjoy football? Answer – she ensures the whole family can experience a day at the game, through family friendly price tickets to education programmes in local schools.

What does she do for “me time”? Answer – She reads. Voraciously. Usually articles on business.

For me, I was less interested in her femaleness, much more interested in her business experience. It seems to me, having watched her career and now heard her speak, that Karren’s success is built on foundations of hard work, clear vision and pure determination. These are attributes common to both men and women, they are not gender specific; they are the building blocks for any “person in business”.

If you would like to join the debate please follow it on linkedin here.

The Smiths decided to launch the petition after seeing MPs including Hodge, chair of the public accounts committee, attack Amazon, Google and Starbucks over their tax affairs. The MPs claimed that Amazon was avoiding UK taxes by reporting its European sales through a Luxembourg-based unit, and Hodge said that “people want to know why companies which benefit from an infrastructure paid for by them and who are paying people low wages who receive taxpayer-funded tax credits from the exchequer are not paying their fair share”.

“Times are tough and getting tougher,” the Smiths write in their petition. “We face unrelenting pressure from huge online retailers undercutting prices, in particular Amazon, and it’s pushing businesses like ours to the brink. But what’s even worse is that Amazon, despite making sales of £3.3 BILLION in the UK last year, does not pay any UK corporation tax on the profits from those sales. In my book, that is not a level playing field and leaves independent retailers like us struggling to compete just because we do the right thing.”

Back in December, “we would have been glad with a few thousand signatures”, said Frances Smith, “so to get almost 160,000 is just amazing. It just shows you how much people care.”

Together with Hodge and the Smiths’ local MP Chris White, the couple, who run the Kenilworth and Warwick bookshops, handed their petition in to Downing Street  ”At least it’s showing them how strongly people feel about it – that they have to act. [And] it’s making people aware of the fact that if they don’t use their high street, it will be a sad day when there’s nothing left,” said Frances Smith.

This article on corporation tax comes courtesy of the guardian

Nice to know that even here at TTL we are not exempt from HMRC taxation rebate phishing scams as our Director’s husband receives a supposed rebate (see image attached). Please be aware these are doing the rounds, today several are again in the press, as the taxman warns people not to fall victim supported by the evidence that almost 80,000 tax rebate phishing emails were reported last year. These scams promise refunds in return for credit card and bank account details.

Those who respond to such emails risk having their bank accounts emptied and credit card balances increased as details are passed around organised crime gangs.

beware of fraudulent tax rebate

HMRC closed a staggering 522 illegal sites in 2012 that originated from countries including the United States, Russia and Japan.

Gareth Lloyd, head of digital ­security for HMRC, said: “HMRC does not email customers about tax refunds – we only ever contact customers who are genuinely due tax back in writing, by post.”

If you receive an email offering a tax rebate and claiming to be from HMRC, forward it to phishing@hmrc.gsi.gov.uk, then delete it from your system. Legitimate tax rebate forms (P800s) will come from HMRC with a payment order and these will never ask for credit or debit card details.

Make sure that you do not click on links in emails or open any files attached to the email; indeed members of our team at Total Tax have received these emails direct to our office email account so please be ultra aware and pass this information on to others who may be a little less vigilant.