Business Advice

Are You Aware of the Changes to Companies Law
Are you aware of the changes to Companies Law? 758 513 Stepping Stones Accountancy

Are you aware of the changes to Companies Law?

Companies Law applies to any business that is registered in the UK and sets out a business’s legal obligations, which they must comply to. There are a set number of requirements which need to be adhered to and if business fail to do so then punishments can be severe. This can include financial risks or penalties, personal liabilities for debts and potential removal of directors. To find out more about the full details of Companies Law please follow this link – https://www.legislation.gov.uk/ukpga/2006/46/contents.

Recently the Government has advised that some changes are being made to Companies Law. These will impact any limited companies that are registered with Companies House. The key reason for the update is to give businesses greater transparency and to allow Companies House to have clearer recognition that the standards and requirements they set for each and every business, are being adhered to.

As with any communication released by the Government, they never seem to be able to express exact requirements in a simple and easy to understand method. So, we thought it would be beneficial to offer our own translation. All the changes are being introduced this month (March 2024):

  • Companies House will be able to query more businesses, for example if they feel certain elements are incorrect or they perceive some inconsistences then it will be much easier for them to seek further guidance with less ambiguity.
  • When registering company names a more stringent approach will be taken to ensure the business name is unique and does not include any connotations of other businesses who are already registered.
  • A business‘ registered office must be a fixed and official location; it can no longer be registered using a PO Box.
  • For registration a company must include an office e-mail address
  • Companies will have to declare that the business is being established to undertake activities which comply with UK law (nothing can be unlawful). Also, a declaration confirming the same is then required thereafter for every year the business is running.
  • Finally, the register for all UK businesses will be cleansed to ensure any data flagged as misleading or not accurate will be removed. Notes will be added for potential issues which Companies House can then act on. All up to date data will be accessible by other government agencies and law enforcement authorities.

So, to conclude these changes are being introduced to help eliminate fraudulent information being used by companies, business owners and directors. It is also expected that more changes will follow in the coming months.

Overall, the changes will simply be to allow limited companies to ensure that all their registered data is accurate.

If you have any questions or queries, then the Stepping Stones Accountancy team can offer both help and support. Please call us on 01173 700 079 or e-mail hello@steppingstonesaccountancy.co.uk.

You can also book a free 20-minute call with Yarka – https://calendly.com/yarka-ssa/20min

Why use cloud accounting software
Why use cloud accounting software? 758 513 Stepping Stones Accountancy

Why use cloud accounting software?

Changes to the operational structure of a business can be challenging. Quite often a business owner will find success in doing something a specific way and in turn will be very reluctant to change. Let’s explore this more in the context of accountancy and why switching to cloud accounting software is so beneficial.

Historically a business would have several spreadsheets and lever arch files containing records of receipts and other important documents. They would be reluctant to change because they feel comfortable with the systems in place and all the team know what is expected of them. However, the biggest fear factor is the thought that moving everything on to a cloud accounting system would cause extra work and require lots of in-depth training.

The simple answer to any resistance is that using spreadsheets can be a slow and manual process, human inputting errors can be hard to identify, and you don’t have immediate access to important financial data which is important for any growing business. Persevering with old accounting methods can give competitors, who use a cloud accounting system, a far superior edge thanks to immediate access to financial data and greater insights into business performance.

Another key consideration is, what happens when things for wrong? For example, if something happens to manual files, how easily can they be recovered? A cloud accounting system can offer secure access from any type of device which is connected to the internet.

Here are some of the top reasons why a business should use cloud accounting software for their business:

  • Everything is secure as it is stored in the cloud. Data can be accessed 24/7, from any location if the user is connected to the internet.
  • No software needs to be installed on any machine and there is no ongoing maintenance required.
  • Upgrades to the system are handled automatically meaning that the user benefits from any new features that are introduced.
  • There are no specific hardware requirements just an annual license to the system so the costs for using the system are very low.
  • There is no need to use the services of an IT specialist to help with the set-up.

The advances in cloud accounting systems over the past 4 to 5 years have been incredibly comprehensive. The number 1 benefit is that the system continues to evolve and develop based on the specific needs of the users. This means the software provider will ensure the system continues to offer more and more advantages to all those businesses that are using it. It is scalable, offers lots of flexibility and gives a business accurate, real-time data.

The simple takeaway for anybody not using a cloud accounting system is that you should make the switch today. The solution will grow and change in line with the exact growth and changes that are happening within your business.

Once the decision has been made to start to use a cloud accounting system the next step is to clarify your specific requirements and make sure that you get the best option. These simple questions should help:

  • What are the day-to-day accounting activities that need to be completed?
  • What access levels and what number of users are required?
  • Which team members should be consulted when choosing a new system?
  • What is the best system based on our specific business needs (ask to see client case studies to demonstrate how the solution is being used by others)?

In conclusion, there are no negatives to stop a business from using a cloud accounting system.

Should you have any questions in regard to any aspects of cloud accountancy then the Stepping Stones Accountancy team can offer both help and support. Please call us on 01173 700 079 or e-mail hello@steppingstonesaccountancy.co.uk.

You can also book a free 20-minute call with Yarka – https://calendly.com/yarka-ssa/20min

Don't Fall For The Fake Tax Refund Messages
Don’t fall for the fake tax refund messages 758 513 Stepping Stones Accountancy

Don’t fall for the fake tax refund messages

The HMRC (HM Revenue and Customs) are taking a very proactive approach in highlighting a spam campaign currently on the rise which relates to false tax refund claims. Although it has been around for a number of years, it has again started to build moment with estimated figures rising by over 15% in the last 12 months.

So, what is the scam?

An email is sent which has been branded to look as though it has been issued by the HMRC, it can be very deceptive, recipients will need to carefully check the actual e-mail address used by the sender. The content of the message will be something like the following:

HM Revenue and Customs (HMRC) has sent you this notification as your eligibility has been checked. We owe you 843.78 GBP.

GOV.UK HM Revenue and Customs Gateway Claims (this will show in blue as a hyperlink)

Your reference is GHS-W3K5-OB8.

By clicking on the links in the e-mail and entering details the scammers can capture vital information when asking for bank details which they will then use for fraudulent purposes.

Why is there such a high interest now?

This time of year, is when the scam hits its peaks as more and more people are filing their self-assessment tax returns. Whilst the example above relates to an e-mail, scammers are also using both phone calls and text messages to offer fake tax refunds.

What are HMRC saying?

The warnings from HMRC are very simple, they will NOT issue any form of communication (e-mail, text or telephone) to let a taxpayer know that they are due a refund. They are also very clear that at no stage will individuals be encouraged to request a refund. If a person is entitled to money back, then this will be clearly shown on their HMRC account and payment can be made directly in to the bank account held on file. At no stage will HMRC issue a communication asking for bank details.

The HMRC are requesting that if any suspicious communications are received then they should be forwarded on e-mail to phishing@hmrc.gov.uk or if text messages received, they should be forwarded to 60599.

Should you have any questions or concerns then the Stepping Stones Accountancy team can offer both help and support. Please call us on 01173 700 079 or e-mail hello@steppingstonesaccountancy.co.uk.

You can also book a free 20-minute call with Yarka – https://calendly.com/yarka-ssa/20min

Are You Aware Of What Form 17 Is?
Are you aware of what Form 17 is? 758 513 Stepping Stones Accountancy

Are you aware of what Form 17 is?

Form 17 is an official HMRC document used to declare what the income split will be on a property, which is jointly owned, so that the correct tax payments can be calculated.

This applies to couples who are married or in a civil partnership and both own a share in land or property. However, it is only required if a split is different to the normal 50/50 percentages.

Typically, a property which is jointly owned is split evenly, however if circumstances change or for some reason this does not work for a couple then HMRC must be notified through the completion of the Form 17. This form will outline the agreed structure and will be used to take in to account the tax liabilities required by each person. It is important to note that a Form 17 is required if both parties are UK residents or if the owners are living overseas and renting the property to tenants.

Many homeowners are confused as to what is exactly needed by HMRC, so let’s provide an example. If a property is jointly owned, e.g. the deeds of ownership are in the name of 2 individuals, but the ownership is 70:30 then a declaration is needed to ensure tax liabilities are evenly accounted for. The completion of a Form 17 will officially announce to the HMRC of the property split and the tax required to be paid by each of the homeowners.

If 2 people own a property but the shares are uneven then you must complete a Landlord Form 17. 

How do I complete a Form 17?

A Form 17 is available via this link – https://www.gov.uk/government/publications/income-tax-declaration-of-beneficial-interests-in-joint-property-and-income-17. The form will need to be completed online and then printed. The printed copy will need to be submitted directly to the HMRC, so we recommend you also print a second copy for your files. When completing the form you will be asked:

  • Details on both property owners to include full name, address, national insurance and tax reference numbers
  • Full address of the property which this form relates to
  • The beneficial interest applicable to both property owners
  • A final declaration signed by both parties

Once a declaration is made to the HMRC the Form 17 needs to be submitted within 60 days, if it is not received within this period then HMRC will consider it as invalid.

If you have any questions regarding the completion of Form 17 or need some help with any aspect of business accountancy our team would be happy to help. Please call us on 01173 700 079 or e-mail hello@steppingstonesaccountancy.co.uk. You can also book a free 20-minute call with Yarka – https://calendly.com/yarka-ssa/20min

Why change something if it is not broke
Why change something if it is not broke? 758 513 Stepping Stones Accountancy

Why change something if it is not broke?

With the changes to self assessment thresholds bought in to simplify the submittal processes, has it really had the positive impact the government were hoping? Let’s explore this in more detail.

When the autumn statement was released there was a very small area included which relates to employees on PAYE who no longer have to file tax returns from 2024/25, regardless of the amount that they earn. This was a follow up on the changes introduced in 23/24 where employees who solely had income from PAYE only had to worry about self assessment when there earnings were in excess of £150,000.

When these changes were introduced there were a number of concerns raised about any underpayments or overpayments that could be made by professionals earning over £100,000 who do not have to file any returns in regards to self assessment.

There does appear to be a number of discrepancies which can cause issues with employees that have no other taxable income than PAYE. There can easily be failures to declare specific liabilities simply because it was perceived that this was no longer needed. There could also be a failure to pay any tax owed on investment returns because again it was assumed this was not applicable.

According to HMRC the message is simple; keep them up to date with all income by using their digital services. Report everything that is relevant. Of course this sounds easy but anybody who has used the HMRC platform knows it can actually be a complex matter. Coupled with the issues which arise when contacting HMRC support to ask questions the phrase “clear as mud” can sum up the entire process.

The simple solution is to leave it to the professionals. Seek out a qualified accountant who knows exactly what is needed can take care of the entire process. Take stock early, consider all factors that are relevant but most importantly, consult with experts who are easy and available to contact when you need them.

In summary the changes in self-assessment threshold have been introduced to simplify the process but clearly it has caused more confusion than clarity. So why change something when it is not broken?

If you have any questions in regard to self assessment thresholds or need some help with any aspect of business accountancy our team would be happy to help. Please call us on 01173 700 079 or e-mail hello@steppingstonesaccountancy.co.uk. You can also book a free 20-minute call with Yarka – https://calendly.com/yarka-ssa/20min

Reflecting on 2023
Reflecting on 2023 758 513 Stepping Stones Accountancy

Reflecting on 2023

December is always an exciting month; businesses start to slow down and everybody looks forward to a much needed break spending time with friends and family. It is also a perfect time for reflection.

For us here at Stepping Stones it has been another enjoyable year supporting the small business community with all their accountancy needs. We have further cemented relationships with existing clients and have introduced a number of new clients working with them as their in-house accountancy department offering standard compliance services of:

  • Payroll
  • Tax returns
  • Tax planning
  • Bookkeeping
  • VAT returns
  • Year end

We have also seen growth in our management accountancy services, offering more strategic advice within areas of:

  • Business advisory
  • Compliance and incorporation

With so many areas to be positive about we are excited to see what happens in 2024.

Of course, first though we are looking forward to putting our feet up and relaxing. Our offices will be closing on Friday 22nd December 2023 and we will be back open again on Tuesday 2nd January 2024.

Finally, thank you to all our staff, suppliers and clients for their support this year.

We wish you all a Merry Christmas and Happy New Year.

For anybody that does need some accountancy help, please call us on 01173 700 079 or e-mail hello@steppingstonesaccountancy.co.uk. You can also book a free 20-minute call with Yarka – https://calendly.com/yarka-ssa/20min

What is invoice fraud?
What is invoice fraud? 758 513 Stepping Stones Accountancy

What is invoice fraud?

There are daily occurrences of spam related issues impacting people and businesses. It could be via e-mail or a telephone call and usually involve a person trying to impersonate somebody else. Their ultimate goal is to access confidential information and extract as much money as possible.

If we put this into a business context, there is currently a very popular scam running focussed on invoices. Invoice scams are common and can have a serious impact on a business’s cashflow. Often the impact of this type of fraud will mean more than £10,000 being exploited from a business from just one single invoice.

Invoice fraud occurs when a business is tricked into changing the bank details displayed on an invoice. Criminals will target businesses by impersonating suppliers. They will look to contact accounts departments and request that records on account need to be updated so that future payments are swiftly paid.

When the criminals are successful, they get paid substantial amounts which in turn means that suppliers remain unpaid and businesses have to swiftly provide a resolution. Often having to pay the cost of the invoices twice will have a serious impact on the businesses cashflow.

There are several steps that a business can take to protect themselves from invoice fraud:

  1. Carefully scan all e-mail communications, if a request for changing payment terms is made, make sure you speak to the company requesting the changes to ensure that it is legitimate. 
  2. If there are any requests for urgent payments, check their validity. It will be very unusual for a supplier to suddenly change their payment terms so a red flag should immediately be recognised.
  3. Make sure that all staff working in accounts are aware of these scams and are given the correct training in all aspects of fraud.
  4. Always be careful with e-mail attachments. Deploy security software that can quickly identify spam messages.
  5. Don’t give too much information away, for example only display the most important business information on a website and make sure any data collection is accurate and secure.
  6. When paying new suppliers, complete due diligence and only make payment when everything is 100% legitimate.

If you have any questions in regard to invoice fraud or need some help with any aspect of business accountancy our team would be happy to help. Please call us on 01173 700 079 or e-mail hello@steppingstonesaccountancy.co.uk. You can also book a free 20-minute call with Yarka – https://calendly.com/yarka-ssa/20min

How to get a mortgage if you are self-employed
How to get a mortgage if you are self-employed 758 513 Stepping Stones Accountancy

How to get a mortgage if you are self-employed

At various times in our working life, we may all have a desire to do something for ourselves and step into the world of business ownership. However, it is only a very small percentage of people that take the plunge and become self-employed. Those that do take the required steps benefit from total independence, a true love for what they do, flexibility in working hours and potentially unlimited earnings.

There are a number of excellent benefits of being self-employed. However, the one problem that can arise is with trying to secure a mortgage. Historically securing a mortgage when you are self-employed can be a challenge as lenders are concerned about the lack of evidence when demonstrating income. To help with this process there are several steps that can be taken to put a self-employed professional in a positive position when applying for a new mortgage.

  1. Preparation

Keep excellent bookkeeping records of income and expenditure, look to use an accounting system which, when populated, can prepare reports of accurate and meaningful data. Always ensure you have a positive credit score and if possible, have a good level of savings.

  1. Speak to the experts

There are several excellent mortgage advisors that specialise in self-employed mortgages. Seek their professional advice and guidance as they can complete an initial fact find, check on affordability scales and match you to the right lenders.

  1. Seek financial accounting help

Use a professional accountant to prepare all financial information. A lender will look more favourably on the application if the accounts have been prepared by experts. The credibility of providing accurate information gives a lender lots of confidence.

  1. Credit history

Try to maintain a positive credit score and if there are any negative connotations then work to address these and allow time before completing the mortgage application. It goes without saying the better your credit score, the better the chances of securing a mortgage.

  1. Positive cash flow

Try to ensure you have a positive cash flow which demonstrates that any bank accounts have a healthy credit. Where possible also have good levels of personal savings which, should income one month be slow, demonstrates that the repayment of mortgage fees will always be covered.

  1. Present the right documentation

Copies of trading history (for the previous two years), HMRC documents such as an SA302 and evidence of upcoming contractual agreements will be required when any mortgage applications are made.

Other personal information used for evidence will also be required these can include passport or driving licence, utility bills, council tax bills and bank statements.

Finally, being on the electoral register with the right to vote is also advantageous as a lender can research this and use it as verification for identification purposes and proof of address.

If you have any questions or need some help with any aspect of self-employment and accountancy support then would be happy to help. Please call us on 01173 700 079 or e-mail hello@steppingstonesaccountancy.co.uk. You can also book a free call with Yarka – https://calendly.com/yarka-ssa/20min

Dealing With Late Payments
Dealing with late payments 758 513 Stepping Stones Accountancy

Dealing with late payments

As a business owner cashflow is king and one of the biggest barriers faced is debt through late payments. Unfortunately, there are many reasons why customers delay making payment. Sometimes it through no fault of their own and for others that is just how they like to do things. Unfortunately for the company being owed the debt it can be very distressing.

Of course, late payment does not just affect the business owner, it can affect employees and the businesses supply chain. If money owed is substantial then trying to pay monthly bills such as salaries, rent or utilities can be incredibly challenging.

Staying on top of late payment is crucial, here are a few tips on how to deal with this:

  • Try to keep a healthy level of cashflow in the business. If you can keep a safety net it will help when customers take their time to pay.
  • If cashflow is an issue, look to take advantage of business finance, get a boost in funds, you can even explore the benefits of invoice finance which allows immediate payment once an invoice is raised.
  • Have accurate terms and conditions and be vigilant with them. When you sign-up a new customer, make sure that they have received a copy, fully understand them and agree to comply with them.
  • Either request a deposit before any work is started or if possible, ask for 100% payment upfront.
  • Fully understand your customers. Complete good due diligence and recognise that if a customer has poor credit rating or reviews then ensure you request full payment upfront. If you come across any red flags make sure you are 100% happy payment will be received, if not walk away from the project.

If things do go wrong, there are also some steps you should follow for best practice:

  • Keep good positive lines of communication, never be derogatory towards the company and document every single form of contact, if it is a phone call try and record the conversation.
  • If you must take action, seek the help of a reliable debt collection agency, ask for recommendations as it can be a challenge to find the right company to support you.
  • Finally, if all else fails seek legal advice and consider taking the matter to a small claims court.

In conclusion at some time or another a business will be faced with chasing outstanding debt. The key thing is to trust your feelings and do what is right for you and your business.

If you have questions or need some accountancy help, please call us on 01173 700 079 or e-mail hello@steppingstonesaccountancy.co.uk. You can also book a free 30-minute call with Yarka – https://calendly.com/yarka-ssa/20min

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