Tax and contracting News
24 - 02 - 2017
Our new contributor, Judith Bond joins us today to share her thoughts on how she is able to run her cake business more efficiently and happily by using Foremans LLP to do her accounts. Judith is a custom Cake Maker from North Wales and is the owner of Judith Bond Cakes based in Llandudno. As well as Wedding cakes, Judith specialises in corporate events and family celebrations and has customers all along the North Wales coast and into Chester. Judith is an enthusiastic photographer and member of Welshot Imaging Academy, keen networker with Mingle for Business and Network She; and she loves writing her blog charting her delightful adventures in cake. Her work has been published in Cupcake Heaven Magazine and she is currently featuring in a Welsh Government advertising campaign. We are delighted that Judith has joined us and hope you enjoy her blog. You can find out more about Judith on her website www.judithbondcakes.co.uk or follow her on facebook www.facebook.com/judithbondcakes or twitter www.twitter.com/judithbondcakes and instagram www.instagram.com/judithbondcakes
CAKE & TAXES
When your Dad is Head of the
Maths Department at your secondary school, there is a heavy weight of
expectation on your shoulders whether you like it or not.
My younger sister and I were
both spectacularly appalling at Maths. It didn't come naturally at all, and our
Dad spent most of his school holidays giving us extra tuition, coaching us
through past papers and working his socks off to get us through our exams.
The trouble was at the age of
13, faced with the Common Entrance exam to Rydal Senior School, I was so
au-fait with past papers that I soared through the exam and came in the top 3
of my year. Great celebrations! Now you
might think this was a top result but it had far reaching consequences!
It meant, of course, that I
was streamed into the A set at the Senior School. The only benefit was that my
poor Dad didn’t have the indignity of trying to teach me. The big problem was
that I went from top to bottom in the first lesson, and struggled during with
every lesson after that.
With a lot of hard work I
achieved a pass in my O’Level and that’s as far as my Maths was destined to
ever go.
Starting my own business in
2014, I knew early on that I would come unstuck with the numbers. It’s funny
how they tell you on the business start-up course that accounts has nothing to
do with maths. This is clearly not true, and they certainly didn’t figure on
trying to teach someone who has not even the slightest sense of numbers!
What a joy it was at the
Network She conference in 2015 when the lovely ladies of Foremans LLP, Chester,
came by my cake stall. They enjoyed several cupcakes (each), told me about
their accountancy services and a few weeks later I was signed up.
The first job was to get my Self-Assessment
Tax Return done for the year. Now there’s many tutorials out there on YouTube,
many leaflets to help you through the process and many business owners that
will tell you it’s easy and you can do it yourself. Ho Ho! Let me tell you - I needed help!
I have a journey to Chester
several times a month anyway for my Photography Academy so I figured a Chester
based accountant would work fine. They are based on the Chester Business Park
so access and parking couldn’t be easier.
The great news for me is that
Foremans specialise in helping small businesses so the Cake Lady from Llandudno
was just up their street. Alison made me feel welcome, she assigned me a lovely
and very clever accountant Sarah to do the maths, and a very friendly and
attentive account manager Jennifer to look after me. Jennifer is now Charlotte
- and Charlotte is just as lovely.
I have total confidence that
my year end accounts are in great hands. I think they like me because I bring
them a lovely white lever arch file with all my receipts and invoices in order.
It makes them smile a lot. Apparently some clients bring in a bin bag! Who
knew?
So it’s February now, and
they have just filed my second year of accounts with HMRC. Everyone is happy.
I hope they would like me
just as much if I didn’t bring cupcakes to their office at tea-break time. But
I guess I’ll never know.
Judith x
If you enjoyed this blog, you
can read lots more cake style, recipes, brand reviews and business tips at
www/judithbondcakes.co.uk
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WEEKLY INCOME INFORMATION
Income For A Week
Pre Tax Income
Choose the Industry Sector that you work in. Use the drop down menu in the usual way.
The VAT Flat Rate Applied -
-
RESULTS TABLES
COMPARISON TABLE FOR NET INCOME
RELATIVE INCOME BY STRUCTURE
Weekly by :-
Annually by :-
Weekly by :-
Annually by :-
Fixed Data
PAYE
Statutory rates
CIS
Corporation tax
National insurance
UMBRELLA COMPANY
AGENCY INFORMATION
Assumptions
General
- The user is over 21 and subject to tax in the UK
- The user wishes to minimise their tax liability
- The user is subject to national insurance i.e.he/she is not over retirement age
- Only current tax rates and limits are applied
- No tax mitigation payments are made e.g. pension contributions
- Only 3 digit letter 'L' tax codes shown in the drop down list can be entered
- The user does not have a turnover greater than £100,000 where fewer reliefs and or higher taxes may apply
Expenses
- All miles claimed as expenses are for business use using a personally owned car or van
- All other expenses claimed are wholly, necessarily and where appropriate exclusively for the benefit of the business
Foremans LLP Charges
- Foremans fees associated with Limited Company, Sole Trader or Umbrella are as per published rates
- Foremans current Service Costs are allowed for in all calculations.
Holiday Pay
- Holiday pay is accumulated week by week by Umbrella or Agency employer but paid out during the year
VAT
- Limited Company or Sole Trader will be VAT registered
- Limited Company or Sole Trader will take advantage of Flat rate VAT
- Flat rate applied includes the benefit of the additional 1% applicable to the first year of VAT registration
Limited Company Conditions
- One director / one shareholder in a Personal Service Company
- Director of Personal Service Company elects to vote for 100% dividend after salary, costs and expenses
- Director's salary is maximum salary to the primary threshold for NI
- The Limited Company is trading normally i.e it is not subject to IR35 and is not a Managed Service Company
NOTES
- The Current tax rates are taken from the Fixed Data Table
- The current Value Added Tax Rate is 20% and is applied to all invoices and expenses as appropriate
- The Director's Salary is fixed in relation to National Insurance thresholds. Higher Rate Taxpayers should consider the advantages and disadvantages of a larger annual salary or bonus
- Higher Rate Taxpayers may wish to consider the advantages and disadvantages of shared ownership of their business
- Users with a tax code other than three digits and letter "L" may telephone or email our Development Department to request a detailed calculation
- Generally the use of an Umbrella rather than an Agency payroll is only efficient if sufficient weekly expenses are allowable and claimed
- The expenses claimed under an Umbrella should not prevent the proper operation of National Minimum Wage
Dave Wilde, Foremans (UK) Limited
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