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Monthly Archives: August 2012

How are you wired?

I recently became the owner of a new blue Samsung Galaxy III smart phone, which I am now getting used to it, but I immediately found it a big improvement on my old Blackberry Bold, so much so that it made me reflect on how far smart phones or phones, have come over the last few years.

Fully functioning office in your pocket

Now it is possible for a contractor or freelancer to have a fully functioning office facilities, instant communication facilities in a 7cm gadget that fits into your coat pocket.

Online accounting systems

Accounting systems have moved on as well, gone are the days of buying an off the shelve box from WH Smiths for a couple of hundred pounds, and many hours of head scratching trying to get the programme and the figures to make sense.

Most progressive accounting firms have moved their clients accounting software online, so a client can have access to their accounts 24/7, often accessable through their smart phones.

Do you need Face to Face meetings?

Whilst all this technology is welcome, emails and phone calls can deal with most matters efficiently sometimes a face to face meeting with a person who understands your business, or when you are starting as a new contractor, is the only way to go, to give you the peace of mind more than any amount of electronic communication.

Maybe it is just the way that we are wired

Freelancer Accounting provides accounting and taxation services to freelancers and contractors in London and the South East of England, from their offices in London, Canary Wharf, Reading, Richmond and Guildford. We would be delighted to meet with you to to discuss your accounting needs.

Significant increase in HMRC house searches as taxman targets tax evaiders

HMRC has performed 192 property searches in the first quarter of 2012, which is three times higher than any quarterly record available.

In 2011/12 there were 499 searches of residential homes and business properties which was a 155 percent increase on the previous year.

HMRC have stated they have an aim of increasing criminal prosecutions fivefold by 2014/15, and with the increase in searches of residential homes and business premises this target may be reached.

HMRC has recently come under increased attention due to the generally poor economic conditions in the UK and the media attention given to high profile entertainers and sportsmen using tax schemes to avoid tax payments.

The estimated amount of money lost to tax evasion in the UK is £4billion.

Are there any tax breaks for my new business?

This is a question that we often get asked by clients?

A tax break that should be considered especially if you need to employ people is HMRC run as scheme where new businesses can receive a twelve month employer National Insurance Holiday for up to ten new employees.

There are a few hoops to jump through with this scheme, ie the business must tbe outside of the south east of England and London and the staff must have been hired by the 5th September 2012.

This tax break could be worth up to £5000 per member fo staff taken on, a big benefit to any start up.

It is unsure if this benefit will still be available after the 5th September so to take advantage of this you need to be quick.

Olympic Legacy for UK plc

The Olympics is UK plc’s largest live experiment in telecommuting. Futurologists have been telling us for years that work would be done at home, the beach or the coffee shop making use of all the technology that is now available to us.

It is a shame that the experiment didn’t take place at a better time, perhaps October/November when UK plc is in full Usain Bolt like flow, instead of in the middle of the slow summer holiday season, but i’m sure the Olympics take precedent over any economics experiment.

What will be the legacy of this telecommuting experiment?

Time will tell, but most predictions of the future tend to be wrong, i.e. we are not flying around in Jetson style space ships or eating hydrogenated potato mash style.

But I would expect that managers can see that teleworking is now a real possibility, and workers providing you have a real system for monitoring, organising and rewarding teleworkers then it is a valid business choice.

Workers avoiding the costs and time of travel would also benefit from this arrangement, and the cost and overhead of office space in prime locations would be saved.

Perhaps the Olympics will give a competitive advantage to UK plc which will outlast the memories of the excellent performance of our athletes.

Is it a good time to be a freelancer or contractor?

Is there a glimmer of hope on the horizon for freelancers and contractors?

The economy is in a difficult place, post credit crunch, with growth stagnant and trouble brewing in the Eurozone. It is easy to become negative about the whole situation, but for those of us old enough, or for students of the dismal science, of which I am both, we know recessions come and go, and also when you are in one it feels as though nothing will bring you out of it. Continue reading

General Anti Abuse Rule (GAAR)

An important consultation document doing the rounds at the moment is the new General Anti Abuse Rule (GAAR) which is targeted at artificial and abusive tax avoidance schemes which can not be reasonably regarded as a reasonable course of action having regards to the circumstances.

This is already a gray area, and hopefully these rules will bring a bit of clarity around it, but any legislation needs to come with clear guidance, the better the guidance the more chance the legislation will achieve what it intends to.

Are you prepared for your Limited Company year end?

If you freelance or contract through your own Limited Company you will probably be aware that your company will need to pay corporation tax on its profits and certain expenses, provided they are incurred within the accounting year in question will attract a corporate tax deduction.

If your company year end is approaching what should you do? Continue reading

Unlimited fines for Companies Act offences

There are a wide variety of offenses which a Director could incur a penalty with Companies House, these fines and penalties are currently capped at £5000, they generally arise through non submission of annual accounts or annual returns or failing to report company secretarial matters.

This is all about to change as a result of the Legal Aid Sentencing and Punishment of Offenders Act 2012 (LASPO) fines which are currently capped can now be unlimited, leaving the ability for judges to impose more pertinent fines on wealthy individuals or corporates.

17 Years at her Majesty's pleasure

Dilawar Ravjani is starting his 17 years jail term for his part in masterminding a complex tax scam which has resulted in tax lost of £107m. Other members of his 15 strong gang have received sentances of up to11 years for their parts in the fraud.

The fraud involved making ficticious VAT reclaims on high end mobile phones often with the phones not existing. It was estimated the fraud involved sales of £1.7bn  which equated to £176m of VAT, although action by HMRC inspectors resulted in the actual tax lost being £107m, which HMRC are trying to reduce through asset seizures.

Carousel VAT fraud is often refered to as missing trader fraud and involves goods being passed around linked companies in a chain with fake business transactions being created in order to claim large amount of VAT.

Thoughts on the Olympics

Its has been great watching team GB win a few medals, and people are now getting excited about the track and field events coming up, we are in for a good week of sport.

When the Olympics is over, its legacy will be examined, and you would expect that the costs and benefits of the Olympics will be one of the hot topics debated keenly in the pubs and clubs of the land.

Tax avoidance and tax evasion has become another high profile topic in the pubs and clubs of the land over the last couple of months, with lots of moral posturing and finger pointing by the politicians and the tabloid papers.

There is a huge link between tax avoidance and the Olympics which seems to have slipped under the radar, by default the UK Government created a tax haven in ‘London’ from the 8th March 2012 until the 8th November 2012, with the Olympics being in town.

The UK agreed to tax breaks in negotiations with the International Olympic Committee, with Athletes having special dispensations on sponsorships and earnings and corporate sponsors having exemptions on Olympic based sales.

Whilst you can see the arguement for the Government agreeing to this. Isn’t it just high profile sportspeople avoiding tax?

Make you think doesn’t it, maybe this will be thrown into the debate in the pubs and clubs?