Construction Industry Scheme (CIS)
You should register for CIS if you work for a contractor and you are either self-employed, the owner of a limited company or a partner in a partnership or trust
Under CIS, as a contractor you must deduct 20% from your subcontractors invoice payments and pay this directly to HMRC, As a subcontractor, these deductions count as advance payments towards your tax and National Insurance liability.
If you are not registered for the scheme, then contractors must deduct 30% from the payments instead. It is possible for subcontractors to apply for Gross Payment Status, which means that no deductions are made in advance.
Contractors are required to give all subcontractors a summary in the form of a monthly statement showing what they have paid and the deductions. It is important to keep these records as part of your own tax computation.
One of our specialisms is the construction industry and we are often answering questions around CIS. If you would like support with your CIS arrangements, then please contact us.
2 Step Authentication
More and more software providers are recommending 2 step authentication to allow you to log into their software. It is not always compulsory, but the extra verification is strongly recommended as a security layer to help combat cyber security.
For example, one of the cloud accounting software providers that we support, Xero, encourage you to switch on 2 step authentication. You still log in initially using your email and password, but then are asked to generate and enter a six-digit code provided by a separate app on your smartphone, ‘Google or Windows Authenticator’.
Keep your data safe, switch on 2 step authentication.
Capital Gains Tax (CGT)
CGT is a tax on the profit when you sell (or 'dispose of') something (an 'asset') that's increased in value. It's the gain you make that's taxed, not the amount of money you receive.
CGT is payable by UK resident individuals and trustees (incl. personal representatives). It is also payable by non-residents on disposal of UK residential property. Partnership gains are apportioned to the partners. Limited companies pay corporation tax, albeit computed on CGT rules (including Indexation allowance, which is not available to individuals).
CGT can be a complex tax and often confused with income. If you would like to know how you gains are computed, losses utilised and the rate payable, then please contact us.
How do I identify a good Bookkeeper?
If you are looking to employ a bookkeeper or use an outsourced bookkeeping service, such as that offered by ourselves at HCA, then here are our tips to help you find the right support:
- Do you feel you can work with them?
- Do they understand your business and your processes that impact your financial systems?
- Are they qualified to undertake the task you desire?
- Do they have the level of experience and knowledge to support your business? If required, are they more than just a number cruncher?
- Do they have experience in your industry or similar? A specialism in your sector can help to work efficiently and effectively.
- More than just a bookkeeper. Someone who can help you set up or develop your bookkeeping system and processes.
- Are they able to communicate and explain the financial terminology in your language?
- Do they invest in their knowledge and personal development to keep abreast of change that will impact you and your business, which of course they will then share?
- Are they able to demonstrate their expertise with the software package you use or recommend which is best for your business?
- If outsourced, do they have a clear charging policy, so that you are not charged for every request or contact you make.
- If outsourced, are they insured and correctly regulated as per the guidance of HMRC?
If our friendly and professional team at HCA can support you in any way, then please do not hesitate to contact us.
Do your research
Whether you are starting your business or developing your offering with a new product or service, then it is recommended to give yourself the best chance of success with effective research.
Here are a couple of tools to support your strategic considerations and assist with your market research:
SWOT analysis – this tool helps you to explore and delve into your Strengths, Weaknesses, Opportunities and Threats. You can also use the tool to reflect on your competitors position. Once identified, you can build on your Strengths and Opportunities, develop your Weaknesses and avoid the Threats.
PESTLE analysis – this tool helps you to step back from your immediate thoughts and consider the impact on your business of areas including Political, Economic, Social, Technological, Legal and Environomental. Often these considerations lead to an appreciation of the many external factors that you should consider and look to manage where possible.
Would you survive an IT failure?
How would you cope without your PC, laptop or internet access for just a few hours? Stressful? Everyone is now more reliant than ever on our devices, the cloud and a fast internet connection.
Based on our experience, here are a couple of reasons why you may find yourself without your device for a period of time, either for a few hours or a few days at best:
- You have not managed the security of your device or its underlying system (eg network). A security attack, virus or similar has restricted your access.
- You have not managed the health of your device or network. How often do you clean up your PC, laptop or device? Do you invest in your IT maintenance? Failures of equipment can be frustrating and avoided if the warning signs are managed.
We recommend completing an impact analysis and ask ‘What if?’, whilst considering how it would impact your working processes and how you could mitigate the risks.
At the same time, reviewing your security, maintenance, back-up procedure, password security and accessibility, staff awareness and software versions.
If you would like to discuss how our IT-tech team can help you avoid down time and mitigate a failure, then please call Chris on 01635 48200