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Shropshire Accountants

Accounting Advice

Having a good firm of accountants on your side will ensure that you have all the information and support that you need to help your business grow and flourish.

They can offer advice and help you comply with accounting and tax requirements.

If you are self employed or run a small enterprise in Shropshire, it makes sense to use Accountants or Bookkeepers also based in Shropshire. Local accountancy firms that are prepared to help small business and new business start ups in the area are listed below.

Local Partners

BAT Business Services Ltd

BAT Business Services Ltd

Bat Business Services provides affordable and practical advice and support to discerning owners / principals of growing businesses, primarily in the Midlands and North-West.

Not just straight-talking no-nonsense objective professional advice, but also hands-on support in implementing practical and impactful solutions for owners / CEO’s of businesses that are: Starting-up, Growing, Improving, looking to Exit or just looking to be in business in the foreseeable future.

In the first instance, please contact Ian Batkin for an initial confidential no-charge consultation with one of our directors - "you've got nothing to lose and everything to gain !"

http://www.batbusinessservices.co.uk/

Becoming Self-Employed

You should tell HMRC as soon as you start self-employment, otherwise you may face a penalty. You are considered to have started self-employment when you have something to sell and either have a customer for your goods or services, or you are actively marketing your business.

You can let HMRC know about your self-employment by registering online for business taxes. A Self-Assessment Online account will automatically be set up at the same time. This allows you to send your Self-Assessment tax returns online. You’ll receive an Activation Code. You need to activate the service within 28 days. If you don’t, you’ll have to ask for a new Activation Code.

You can register online at www.hmrc.gov.uk/online/new.htm

National Insurance

As a self-employed person, you pay a fixed amount of Class 2 National Insurance contributions (NIC). If your profits are above a certain limit, you may also have to pay Class 4 National Insurance contributions.

Class 2 National Insurance

Cost £2.80 per week for 2015-16. As from 2015-16, this is collected via self-assessment. You can set up a Budget Payment Plan if you wish.

If your taxable profit is, or you expect it to be below £5,965 (2015-16) you can apply for an exception (SEE) from paying Class 2 NI, called small earnings exception (SEE).

You can apply for SEE when registering your self-employment or by completing a form CF10.

If SEE is awarded you could lose your entitlement to some state benefits, for example, the State Pension.

For more information about the State Pension, go to: www.gov.uk/state-pension

Class 4 National Insurance

If your taxable profit exceeds the lower profit limit (£8,060 for 2015-16), you may be liable for Class 4 NI contributions.

The rate is 9% of your taxable profit above the lower profit limit.

If your taxable profit exceeds the upper profit limit (£42,385 for 2015-16), 2% is charged on your profit above the upper profit limit.

Example - tax year 2015-16

Taxable profits £27,498
Less lower limit £8,060
Amount chargeable £19,438

Class 4 due £19,438 x 9% = £1,749

Statutory Records

Records

It is very important that you set up a record keeping system and keep all records and supporting documents. Records for the current tax year must be retained until 31 January 2022.

You must keep records of all money coming into and going out of your business. This includes all cash, cheques and credit card transactions.

Your records should be adequate to allow you to complete an accurate Self Assessment return. You will be expected to keep a full record of:

All sales made and other business income, as it is earned.

The cost of all business expenses and purchases as you pay them, no matter how little they cost.

All purchases of business stock, goods and raw materials.

Mileage records.

Capital expenditure; keep a separate record of all purchases and sales of business equipment, machinery and vehicles, together with the receipts.

Keep a record of the market value of equipment or vehicles introduced into the business that you owned before starting your business.

Accounting Period

You may find it useful to organise your records into accounting periods. These normally last for 12 months although they can be for longer or shorter periods, and end on a date which you choose.

Your first accounting period begins on the date you started in business and ends on the date you close your accounts each year and calculate profits. For example, you could close your accounts on 5 April to coincide with the end of the tax year or some other date appropriate to your business. It is entirely up to you but if you select a date other than 5 April you may have to do some additional calculations.

Business Expenses

You can deduct, from your profits, all you spend for the sole purpose of earning business profits. You cannot claim anything you spend for a non-business purpose, for example, premiums on personal insurance policies, Income Tax, personal National Insurance contributions or drawings. What you spend the money on affects whether you can get tax relief for it.

Allowable Business Expenses

An allowable business expense is money spent on the day-to-day running costs of your business. This can include things such as rent, lighting and heating of business premises, telephone and running costs of vehicles used in the business.

Capital Expenditure

Capital expenditure is money spent on items you would expect to last for a number of years. They are referred to as assets and would include items such as equipment, machinery and vehicles

Do not include these costs in your day-to-day business expenses, as special rules apply. You may be able to claim capital allowance but the amount you can claim will depend on a number officiators, such as the type of asset purchased and when it was bought.

Private Expenses

Where expenses relate to both business and private use, only the business part is allowable.

For example, rent, rates, lighting and heating bills for premises and telephone charges could be partly for business and partly for domestic purposes. Where there is both business and private use, cost must be apportioned to claim only the business part.

If you use a vehicle for both business and private use, there are two methods that can be used to calculate business motoring expenses. Whichever method you choose, you must keep mileage records to calculate the split between business and private use. Home to office (or fixed place of business) is classed as a private journey and is not allowable.

Evrite Weekly Accounts Book

The Evrite 707 Weekly Accounts Book is an ideal book for both VAT & No-VAT small businesses. We have included simple instructions and example pages and a video about the book available on youtube or via our website www.evrite.co.uk

The Receipts and payment pages cover every week of the year for your income and expenditure; Summary of Invoices pages allow you to group all your purchases together for each VAT quarter. Near the back of the book you’ll find Stock pages, Quarterly VAT Summary and finally Wages pages.

Accountancy Articles

If run your own business in Shropshire or are planning to do so, we have compiled a library of useful resources and frequently asked questions which we hope that you will find both interesting and useful. Subjects covered include: accounts, bookkeeping, National Insurance, and VAT

Latest Accountancy Articles

Press release: Planning for success made easier for 120 female entrepreneurs in Derbyshire
Article: Why Now Is the Best Time to Start Your Own Business
Article: A wonderful day to start a business
Article: Five tips for starting an online business
Article: 5 Errors That Can Undermine Your New Business; "Skills To Start Business Not Same To Grow It", Says Author

See Full List of Accountancy Articles

Shropshire Accountants

If you offer a product or service that can help new business start ups or existing small businesses in the Shropshire area, we would love to promote you here free of charge. (Add Your Link)

 Free Tax E-Learning Course (HMRC)

Free Tax E-Learning Course (HMRC) Working for yourself? Got a lot of questions about tax, National Insurance, business records and expenses? If so, this HMRC e-learning course is for you.
http://www.hmrc.gov.uk/courses/syob2/syob2/index.htm |

Budgeting for your first self-employed tax bill

Budgeting for your first self-employed tax bill When you start working for yourself, you do not get your first tax bill for a while, so it may help your budgeting to start putting money aside now. The ready reckoner tool can help you with this. It shows you roughly how much money you might need to meet your Income Tax and Class 4 National Insurance bill. It doesn't take into consideration any Payments on Account you may have to make.
http://www.hmrc.gov.uk/tools/sa-ready-reckoner/index.htm |

Online seminars for businesses and the self-employed

Online seminars for businesses and the self-employed HM Revenue & Customs (HMRC) offer a series of free online presentations or ‘webinars’ to give tax help to businesses and the self-employed.
http://www.hmrc.gov.uk/webinars/index.htm |

Why choose a single accountant when you can choose a team?

Why choose a single accountant when you can choose a team? Members in practice (MiPs) are chartered global management accountants in professional practice. They provide accounting services to businesses, but are not direct employees of these businesses. We will work together to achieve your goals, we support each other using our strengths to best advantage. You might only need one of us at first, but it’s reassuring to know that when you need specialist advice you can access our full team. There are 1,400 members in practice in the UK.
http://www.cimaaccountant.com | Contact via website

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