10 Recent Blog Posts https://gorillaaccounting.com/blog/ Shows a list of the 10 most recent blog posts. Changes to childcare vouchers and introduction of tax-free childcare vouchers https://gorillaaccounting.com/blog/changes-to-childcare-vouchers-and-introduction-of-tax-free-childcare-vouchers <p><strong>Following changes made to childcare vouchers, the following schemes are closed to new applicants: </strong></p><ul><li>childcare vouchers</li> <li>childcare your employer arranges with a provider (known as ‘directly contracted childcare’)</li> </ul><p>If you joined one of these schemes on or before 4<sup>th</sup> October 2018, you may be able to continue receiving vouchers or directly contracted childcare.</p><h2>If you joined a childcare voucher scheme or a directly contracted childcare scheme on or before 4 October 2018:</h2><p>You can keep getting vouchers or directly contracted childcare as long as:</p><ul><li>your wages were adjusted on or before 4 October 2018</li> <li>you stay with the same employer and they continue to run the scheme</li> <li>you do not take an unpaid career break of longer than a year</li> </ul><p>You can take up to £55 a week of your wages depending on the tax bracket you are in, which you do not pay tax or National Insurance on.</p><h3>Tax-Free Childcare</h3><p>This launched in April 2017. You open up an online, state-run, <a href="https://www.gov.uk/sign-in-childcare-account" target="_blank">Childcare </a>account and for every 80p you put into it, the government adds 20p. You can get up to £2,000 a year for each child (£500 every 3 months), this would mean you are paying £8,000 a year and so the government is adding £2,000 towards your childcare costs.  </p><p>You and your partner (if you have one) must be earning at least the National Minimum Wage or Living Wage for at least 16 hours per week. You are not eligible if you or your partner has taxable income of over £100,000.</p><p>You cannot continue to claim childcare vouchers or directly contracted childcare if you successfully apply for Tax-Free Childcare. </p><p>If you are still getting childcare vouchers and want to move on to tax-free childcare, you must tell your employer within 90 days if you get tax-free childcare. They will then stop giving you new vouchers or directly contracted childcare.</p><p>You can continue to use any vouchers you already have, including to make a joint payment for childcare with tax-free childcare. There’s no deadline for using your vouchers or directly contracted childcare.</p><p>Once you’ve told your employer that you’re getting tax-free childcare, you cannot re-join their voucher scheme or their directly contracted childcare scheme.</p><h2>Pros and cons of tax-free childcare</h2><table cellspacing="0" cellpadding="0"><tbody><tr><td width="308" valign="top"> <p><strong>Pros</strong></p> </td> <td width="308" valign="top"> <p><strong>Cons</strong></p> </td> </tr><tr><td width="308" valign="top"> <p><br>Benefit available per child</p> </td> <td width="308" valign="top"> <p>Can't get if claiming some benefits</p> </td> </tr><tr><td width="308" valign="top"> <p><br>Available to self-employed parents</p> </td> <td width="308" valign="top"> <p>Can't get if taxable income is over £100k</p> </td> </tr><tr><td width="308" valign="top"> <p>Savings can increase more if childcare costs are high</p> </td> <td width="308" valign="top"> <p>Both parents must work to qualify</p> </td> </tr></tbody></table><h2> Pros and cons of childcare vouchers</h2><table cellspacing="0" cellpadding="0"><tbody><tr><td width="308" valign="top"> <p><strong>Pros</strong></p> </td> <td width="308" valign="top"> <p><strong>Cons</strong></p> </td> </tr><tr><td width="308" valign="top"> <p>No HMRC eligibility checks</p> </td> <td width="308" valign="top"> <p>Employer may not offer it</p> </td> </tr><tr><td width="308" valign="top"> <p>You could save more depending on your childcare cost and company setup</p> </td> <td width="308" valign="top"> <p>Can't get it if self-employed</p> </td> </tr><tr><td width="308" valign="top"> <p>Both parents do not have to work</p> </td> <td width="308" valign="top"> <p>Savings can be less if care costs are high</p> </td> </tr></tbody></table><h2> Tax-Free Childcare – What to do</h2><p>1. Check that you are eligible and ensure the childcare provider is approved. Approved childcare is usually provided by one of the following:</p><ul><li>registered childminder, playscheme, nursery or club</li> <li>childminder with an Ofsted-registered childminding agency</li> <li>registered school</li> <li>home care worker working for a registered home care agency</li> </ul><p>2. If you are already using childcare vouchers or directly contracted childcare, compare the financial benefits to you between this method and tax-free childcare.</p><p>3. Apply for tax-free childcare and if you are eligible, a childcare account will be created for you.</p><p>4. You can then use the online account to pay your childcare provider.</p><p>5. Every 3 months, you will be required to sign into your childcare account and reconfirm your details.</p><p><strong>If you would like to speak to a member of the Gorilla Accounting team, call 0330 024 0406 or email <a href="mailto:info@gorillaaccounting.com">info@gorillaaccounting.com</a>.</strong></p><p><strong> </strong></p><p> </p> Thu, 18 Oct 2018 15:30:00 +0100 https://gorillaaccounting.com/blog/changes-to-childcare-vouchers-and-introduction-of-tax-free-childcare-vouchers Life as an IT Contractor https://gorillaaccounting.com/blog/life-as-an-it-contractor <p><strong>Working as an IT contractor can be incredibly rewarding, not just financially but because of the wealth of new and existing technology that you're exposed to each and every day.</strong><strong> </strong></p><p>What's more is that by having a legitimate, well-run business which you'll be able to trade through, you'll significantly increase your business standing, potentially helping you to attract new clients and win contracts along the way. </p><p>In this guide, we'll take a look at how you can set up your own IT contracting business. </p><h2>Setting up as a Limited Company IT Contractor</h2><p>First things first – you're going to need to register your business with Companies House and that requires a company name. Some tips for picking a good company name include: </p><ul><li>Avoiding swear words, curse words and names which may be deemed offensive</li> <li>Avoiding names which sound very similar to other companies</li> </ul><p>Make sure to <a href="https://www.youtube.com/watch?v=YUD3u6xumQs&amp;t=2s">check out our video explainer</a> on choosing a company name or alternatively, get in touch with our New Business team if you'd like to discuss what's suitable and what isn't.</p><p>Next up, it's time for you to lock down a formal business address as you'll need this as part of your Companies House registration. If you're not in a position to take on your own premises, you can add a temporary office address, so you can begin receiving legitimate company documents. <a href="https://gorillaaccounting.com/blog/choosing-your-registered-office-what-you-need-to-know">Registered office addresses</a> are also available for business use.</p><p>You'll also need to get your <a href="https://gorillaaccounting.com/our-services/bank-accounts-contractors-freelancers/">business bank account</a> open so that your personal finances are kept separate from your business ones. FreeAgent will also allow you to connect your bank feed to your online account.</p><p>Once these initial tasks are out the way, it's a great idea to knuckle down on building your client base, building your brand, marketing strategy and of course the all-important element of keeping your accounts firmly in order. </p><p>As an IT contractor, you'll need an accountant in place who understands your industry and the unique financial demands that it faces on a day to day basis. For example, having access to clear explanations of the <a href="https://gorillaaccounting.com/resources/gorilla-guides/24-month-rule/">24-month rule</a> and <a href="https://gorillaaccounting.com/resources/gorilla-guides/what-is-ir35/">IR35</a> can help to save you money whilst our additional benefits of <a href="https://gorillaaccounting.com/our-services/online-bookkeeping-software/">FreeAgent</a> and a dedicated accountant can help you to improve the efficiency of your tax payments.</p><h2>How can we help IT Contractors?</h2><p>At Gorilla Accountants, we understand how IT contractors operate. From remote jobs to long distance contracts, each IT contractor that takes us on as their accountant comes with a unique set of individual circumstance.</p><p>Our services include:</p><ul><li>Preparation of financial statements</li> <li>Business bank account</li> <li>Free subscription to online bookkeeping tool, FreeAgent</li> <li>Preparation and submission of VAT and Corporation Tax returns</li> <li>Tax planning advice</li> <li>Direct access to dedicated accountant via telephone, e-mail, face to face meetings and Skype</li> <li>Assistance with HMRC records checks</li> <li>Preparation of Companies House Confirmation Statements</li> </ul><p>Once you've appointed Gorilla Accounting, you'll receive complete, unrestricted access to a dedicated personal accountant who will work with you to understand the intricacies of your business. They'll be available throughout the week by e-mail, telephone, video conferencing and even face to face meetings, and the best bit is that there'll never be any extra charges no matter how often you engage.</p><p>It all starts by letting us know that you're interested in using us as your accountant. If you’re switching accountants, we’ll work with your existing accountant to retrieve all of the essential documents needed to get your company finances back on track.</p><p><strong><a href="https://gorillaaccounting.com/contact-us/general-enquiries/">Register your interest</a> today with Gorilla Accounting and find out how we can help your business to reach its full potential.</strong></p> Wed, 17 Oct 2018 16:30:00 +0100 https://gorillaaccounting.com/blog/life-as-an-it-contractor Eamonn Holmes in HMRC IR35 dispute https://gorillaaccounting.com/blog/eamonn-holmes-in-hmrc-ir35-dispute <p> </p><p><strong>ITV’s <i>This Morning</i> presenter, Eamonn Holmes, is under the spotlight after HMRC brings his IR35 status into question.</strong></p><p>HM Revenue &amp; Customs are taking a closer look at the earnings of Eamonn Holmes’ Limited Company, Red White and Green Ltd, from the past seven years.</p><p>The television host is awaiting a decision which will rule if his limited company was in breach of <a href="https://gorillaaccounting.com/resources/gorilla-guides/what-is-ir35/">IR35</a> legislation, or compliant.</p><p>Eamonn said to <i><a href="https://www.thesun.co.uk/tvandshowbiz/7436289/eamonn-holmes-tax-war/">The Mail on Sunday</a></i><i>,</i></p><blockquote> <p><i>“</i>They’ve reinvented the rules.</p> <p>"I am the test case. If they win against me they will go after everyone else, everyone. Ant and Dec will be next.</p> <p>"The country is broke and they are coming to get us. I was in court in Central London for a week in June. I've been freelance for 28 years and that's been okay. Now they've said it's not okay."</p> </blockquote><p>The ITV presenter awaits a decision for his PSC.</p><p>The news comes shortly after BBC presenter, Christa Ackroyd, was <a href="https://gorillaaccounting.com/blog/bbc-presenter-left-to-pay-420k-tax-bill-after-ir35-ruling-">issued a £420k tax bill</a> after HMRC ruled that her contract was caught by IR35.</p><p>Ackroyd who lost the IR35 case against HMRC is appealing the decision after being ordered to pay £419,000.</p><h2>What is IR35?</h2><p>IR35 is a legislative measure brought in by the Government to identify 'disguised employees'. These are people who are effectively employees but work through a limited company to take advantage of the tax benefits. </p><p>To determine whether you are caught by IR35, the working practices must be examined and the contract should also reflect the working practices. The following are some of the points that should be considered:</p><h2>Control</h2><p>This is one of the main tests that would be done to determine whether the working is caught by IR35. </p><p>Those not caught by IR35 will have true control over when and how they work rather than this being decided by the end client. If the end client was to specify the days the contractor should work, this could point towards employment and therefore being caught by IR35.</p><p>Other specifics that could be looked at under control could be whether start and finish times appear in the contract. If they were included, this could point towards the end client having control.</p><h2>Mutuality of Obligation</h2><p>This is where there is an obligation between the worker and the client of work being completed and further work being offered.</p><p>Where this is in place, this would indicate employment and therefore caught by IR35. A contractor who is not caught by IR35 should not have an obligation to carry out further work, they should ideally work on a contract for services basis where there a specific project. </p><h2>Substitution</h2><p>This involves looking at who completes the work if the contractor is unable to do so.</p><p>If the worker can genuinely choose who completes the work if they cannot, then this is likely to be outside of IR35. If the worker has no say and it is the client who decides, this could be an indication of employment.</p><h2>Other Considerations</h2><p>If the worker is part of the company and behaves like an employee, this would indicate as being caught by IR35. For example, this could include the worker appearing on organisation charts and attending team meetings with other employees.</p><p>If the worker uses their own equipment rather than the client’s equipment, this could also be an indication that the contract is not caught by IR35.</p><h2>How does IR35 impact the worker? </h2><p>If not caught by IR35, the worker gets the benefit of choosing a tax efficient salary from the limited company and they can then top up their income by declaring dividends from any company profits. </p><p>If you are inside IR35, you will be effectively treated as an employee and pay income tax and national insurance contributions on the majority of the company income. The worker will not normally have employment rights. </p><p>If you operate under an umbrella company, like <a href="https://gorillaaccounting.com/our-services/gorilla-payroll-umbrella-company-contractor-freelancer/">Gorilla Umbrella</a>, then all of these tax contributions will be sent straight to HMRC on your behalf. </p><p>Each time you take on a new contract, you’ll need to make an assessment as to whether you’re inside or outside of IR35.</p><p>If you’re contracting for a <a href="https://gorillaaccounting.com/resources/ir35-guide-contractors/">public-sector body</a>, the rules will be different for you. </p><h2>How can I check my IR35 status? </h2><p>If you're unsure on what your IR35 status is, there are a handful of ways that can help determine your status.</p><p>Firstly, the government has an <a href="https://www.gov.uk/guidance/check-employment-status-for-tax">online tool</a> which can give you an instant online answer. The CEST tool, ‘check employment status for tax’ can be used to find out if you’re a worker or if you should be classed as employed or self-employed for tax purposes.</p><p>The tool will give HMRC’s view on the following: </p><ul><li>if intermediaries legislation (IR35) applies to your contract</li> <li>if the off-payroll working in the public sector rules apply to your contract</li> <li>if a worker should pay tax through PAYE </li> </ul><p>In order to use this service, you’ll need the following to hand:</p><ul><li>the worker’s responsibilities</li> <li>the decision maker for what work needs doing</li> <li>the decision maker for when, where and how the work’s done</li> <li>how the worker will be paid</li> <li>benefits included or reimbursement for expense</li> </ul><p>An alternative way of determining your IR35 status is by using an IR35 specialist to carry out a focused review.</p><h2>Introducing Larsen Howie</h2><p>We work with <a href="https://gorilla.larsenhowie.co.uk/">Larsen Howie</a>, the specialist IR35 Contract Review provider for contractors, freelancers and consultants to deliver a competitively priced service to clients of Gorilla Accounting at a competitive price.</p><p>Through Gorilla Accounting, you’ll have the option to carry out an Assessment, Full Review, a Refresher Review or Convert Review. For more information, take a look at the <a href="https://gorilla.larsenhowie.co.uk/">price guide</a> here. </p><p><strong>If you would like to speak to a member of the Gorilla Accounting team, call 0330 024 0406 or email <a href="mailto:info@gorillaaccounting.com">info@gorillaaccounting.com</a>.</strong></p><p><strong> </strong></p> Thu, 11 Oct 2018 13:00:00 +0100 https://gorillaaccounting.com/blog/eamonn-holmes-in-hmrc-ir35-dispute Buy-to-Let - Personal or Ltd Company Ownership https://gorillaaccounting.com/blog/buy-to-let-personal-or-ltd-company-ownership <p><strong>As income tax relief on finance costs for buy-to-let properties is being restricted, the question which now arises is - Is it becoming more beneficial to purchase personally or <a href="https://gorillaaccounting.com/our-services/buy-to-let/">through a Limited Company</a>?</strong></p><p>From the 2020/21 tax year, if you own a buy-to-let property personally, you cannot deduct the finance costs from your property income when calculating your taxable profit. However, you will get a basic rate tax reduction on the finance costs from your income tax liability. </p><p>This measure came into effect for finance costs incurred on or after 6 April 2017. </p><p>This is such a game-changer for landlords, therefore the new regime is being phased in over four years on the following basis:</p><ul><li>Tax year 2017/18: You can deduct 75% of your finance costs from property income. The remaining 25% can be claimed as a basic rate reduction from your income tax liability.</li> </ul><ul><li>Tax year 2018/19: You can deduct 50% of your finance costs from property income. The remaining 50% can be claimed as a basic rate reduction from your income tax liability.</li> </ul><ul><li>Tax year 2019/20: You can deduct 25% of your finance costs from property income. The remaining 75% can be claimed as a basic rate reduction from your income tax liability. </li> </ul><ul><li>Tax year 2020/21: For all financing costs, you incur can be claimed as a basic rate reduction from your income tax liability.</li> </ul><h2>How the figures will look?</h2><p>Below is a very basic example to help you understand how this can impact your income tax liability.</p><p>If you are a higher rate taxpayer, paying tax at 40% and owns a property paying monthly mortgage interest of £600 and receiving £1,100 monthly rental. </p><p> </p><table cellspacing="0" cellpadding="0"><tbody><tr><td width="277" valign="top"> <p>Pre 6<sup>th</sup> April 2017</p> </td> <td width="277" valign="top"> <p>Post 6<sup>th</sup> April 2020</p> </td> </tr><tr><td width="277" valign="top"> <p>Rental income: £13,200 per annum</p> <p> </p> <p><strong>Expenses:</strong></p> <p>Mortgage Interest: (£7,200)</p> <p> </p> <p>Taxable profit: £6,000</p> <p> </p> <p>Income tax (40%): £2,400</p> <p> </p> </td> <td width="277" valign="top"> <p>Rental Income: £13,200</p> <p> </p> <p><strong>Expenses:</strong></p> <p>Mortgage Interest: 0</p> <p> </p> <p>Taxable profit: £13,200</p> <p> </p> <p>Income tax (40%): £5,280</p> <p> </p> <p>Basic rate tax relief on mortgage interest £7,200 X 20%: (£1,440)</p> <p> </p> <p>Net tax payable: £3,840</p> <p> </p> </td> </tr></tbody></table><table cellspacing="0" cellpadding="0" align="left"><tbody><tr><td width="123" valign="top"> <p>Increase of:</p> </td> <td width="123" valign="top"> <p>£1,440 or 60%</p> </td> </tr></tbody></table><p>            </p><p> </p><p>Buying a buy-to-let property via an SPV limited company, rather than as an individual, has recently become more popular mainly due to the above changes.</p><p>As per the <a href="https://www.buyassociation.co.uk/2018/07/18/leap-in-limited-company-landlords-could-be-good-news-for-generation-rent/">recent research</a>, one in five rental properties are now owned by a corporate landlord. It has become even more pronounced in the capital with more than a quarter of rental homes in London are owned by company landlords.</p><h2>Making new purchases under SPV Limited Company.</h2><p>A further option for buy-to-let landlords is to purchase the property by using an SPV limited company with the investor(s) being company directors and shareholders of the company.</p><p>An immediate advantage of this route is that presently, limited companies are able to offset all of the mortgage interest against profits from the rental income. The subsequent profits are then subject to Corporation Tax, currently at 19% but expected to reduce to 17% by the 2020/2021 tax year.</p><h2>Transferring buy-to-let property into an SPV Limited Company;</h2><p>If you have an existing portfolio, it is possible to transfer ownership of the property to an SPV Limited company. </p><p>Any transfer will be deemed at the market value of the property at the time of transfer which may mean additional costs such as capital gains tax, stamp duty, and the legal, mortgage and valuation fees. </p><p>It is also important to note that limited companies do have running costs and legal requirements such as filing statutory accounts. However, you will gain the advantage of tax-deductible expenses such as mortgage broker fees, lender arrangement fees, and accountancy fees.</p><p>Now the question arises, how to draw money from the company? Funds can be taken in the way of salary and/or dividends:</p><h2>Salary</h2><p>It may be advantageous to pay a salary up to the National Insurance threshold of £8,424 in 18/19.</p><p>Any salary paid is an allowable expense against the profits of the limited company.</p><h2>Dividends</h2><p>Dividends are paid from profit left in the business after paying any corporation tax liability. As tax has already been paid by the limited company on the profits, a further Dividend Tax is payable by the recipient shareholder(s) on any dividends received after a £2,000 (for 2018/19) tax-free allowance has been used up. The rate of Dividend Tax will be dependent upon the total income of the shareholder. </p><p>If landlords don’t need the income for current personal expenditure at the time, the retained funds can be used to reinvest in further property ownership for the limited company as opportunities arise.           </p><h2>Summary</h2><p>Careful planning is therefore required as the initial cost in transferring a buy-to-let property to a company may outweigh any benefits in the short term. The mortgage interest restriction is taking 4 years to reduce to basic rate tax relief only, so landlords do have time to plan. </p><p>New buy-to-let property purchases might, however, be more beneficial for tax purposes to be put directly into a company if the plan is to hold the property for the long term. </p><p>If the rental income is required for day-to-day living, you will need to consider how the income will be extracted from the company. This may negate some or all of the tax savings you made by putting the buy-to-let property into a company in the first place. </p><p>It is also worth considering that a company will pay Corporation Tax on the gain if and when a property is sold. As an individual, you have a Capital Gains tax-free allowance (known as the Annual Exemption) of £11,700 for 2018/19. </p><h2>How can Gorilla help?</h2><p><strong>It is therefore essential that tax advice is sought before rushing into setting up a property company. Gorilla offers an <a href="https://gorillaaccounting.com/our-services/buy-to-let/">accountancy service for landlords</a> that operate either through a limited company or own the property personal and can provide tailored tax advice around your specific circumstances.</strong></p> Tue, 09 Oct 2018 12:30:00 +0100 https://gorillaaccounting.com/blog/buy-to-let-personal-or-ltd-company-ownership The Good, The Bad And The Ugly Of Late Tax Return Excuses https://gorillaaccounting.com/blog/the-good-the-bad-and-the-ugly-of-late-tax-return-excuses <p><strong>Filing tax returns will never be the most exhilarating part of owning a business, but that doesn't stop it from being an absolutely essential part of your annual accounts.</strong></p><p>In 2017 alone, HMRC received almost 11 million tax returns from UK businesses. The vast majority of these were delivered on point and on time, with many companies opting to use services like Gorilla Accounting to ensure that deadlines are met and taxes are efficiently paid.</p><p>As you can probably imagine, the excuses for delivering a late tax return come in many different shapes and sizes. Whilst many are accepted as reasonable in the eyes of HMRC, there's an equal number of ridiculous excuses that simply won't wash.</p><p>In this blog, we'll take a look at some of the more reasonable excuses permitted by HMRC, the more far-fetched claims, and the<a href="https://www.gov.uk/self-assessment-tax-returns/penalties"> fines that can come with late payments</a>.</p><h2>The Good </h2><p>In spite of their relatively hardline approach to business finance, HMRC does understand that circumstances outside of your control are always capable of cropping up at exactly the wrong moment.</p><p>Therefore, there are legitimate, <a href="https://www.gov.uk/tax-appeals/reasonable-excuses">reasonable excuses</a> which they'll accept for the late arrival of a tax return, including:</p><ul><li>A partner or close relative died shortly before the deadline</li> <li>An unexpected stay in hospital prevented you from dealing with your taxes</li> <li>You experienced a serious or life-threatening illness</li> <li>Service issues with HMRC online services</li> <li>A fire, flood or theft which directly affected your ability to file your tax return </li> </ul><h2>The Bad </h2><p>Reasons that won't wash quite so well range from the unreasonable to the ridiculous. It might seem harsh in places, but reasons which are not considered reasonable include:</p><ul><li>Someone else was asked to send the return and they didn't</li> <li>Your payment bounced due to a lack of funds</li> <li>You weren't able to easily navigate the HMRC system</li> <li>You never received a reminder from HMRC (this is your responsibility)</li> <li>You made a human/financial error on your tax return</li> </ul><p>The 'fun' really starts when business owners begin to stray into the realms of creativity with their excuses and HMRC have seen it all over the years. In January 2018, they released the latest batch of far-fetched excuses they'd received, anonymously, of course, to help business owners better understand what is and isn't acceptable. </p><p>Some of the most bizarre included:</p><ul><li>My wife is seeing aliens and won't let me enter the house</li> <li>My ex-wife left my tax return upstairs but I can't get it as I suffer from vertigo</li> <li>My business doesn't really do anything</li> <li>I've been too busy touring the country with my one-man play </li> </ul><h2>The Ugly </h2><p>Whilst it's all well and good joking around with far-fetched excuses, HMRC doesn't take quite the same lighthearted approach to late submissions.</p><p>All tax returns must be submitted, and owed taxes paid, by the 31<sup>st</sup> January deadline. Failure to meet this deadline will start the penalties process, a figure that increases significantly the longer your taxes go unchecked.</p><p>Any individual or company that misses the 31<sup>st</sup> January cut off will immediately be subjected to a £100 fine, no matter whether you have tax to pay or not. You'll have up to three months to get your accounts up to date and settle the fine before further charges are added.</p><p>After these three months are up, you'll receive an additional penalty of £10 per day, up to a maximum of £900, effectively giving you another three months to get on top of everything. </p><p>Once six months have elapsed, HMRC really begin to ramp up the fines. You'll face an extra charge of 5% of the unpaid tax or £300, whichever is greater, at six months and then at 12 months which can have a major impact on your business finances.</p><h2>Why use Gorilla Accounting?</h2><p>Using a service like Gorilla Accounting can result in a huge number of financial and administrative benefits for your business. However, by working with us throughout the year we'll be able to take on the responsibility of your submitting your tax returns on time just as long as you provide us with the information we need in good time.</p><p>As part of your £85 + VAT per month package, you'll also receive complete access to <a href="https://gorillaaccounting.com/our-services/online-bookkeeping-software/">FreeAgent</a> – the online accountancy software that will provide you with tax return reminders and easy access to the information you're likely to need to get your taxes paid on time.</p><p><strong>For more information on appointing Gorilla Accounting as your accountant, <a href="https://gorillaaccounting.com/contact-us/general-enquiries/">contact us</a> today and a qualified member of the team will get in touch to discuss the best time to complete your switch.</strong></p> Mon, 08 Oct 2018 09:30:00 +0100 https://gorillaaccounting.com/blog/the-good-the-bad-and-the-ugly-of-late-tax-return-excuses Limited Company Guide to Expenses https://gorillaaccounting.com/blog/limited-company-guide-to-expenses <p><strong>Running your own limited company is full of challenges that you're unlikely to face in other areas of life, one of which is managing business expenses.</strong></p><p>Effectively managing these expenses can have significant tax benefits for your business, so it's well worth brushing up your knowledge on what they are, how they work and what steps you can take to use them to your advantage.</p><h2>What exactly are Business Expenses?</h2><p>In its simplest form, a business expense is any business-related cost that's incurred by you or your staff which can be claimed back from the company. Some of these are taxable whereas others won't require any contributions whatsoever.</p><p>The most common type of expenses tend to be related to working away including accommodation, subsistence and the actual cost of travel. Whilst that's all straightforward enough, there are plenty of caveats and criteria in place that can make expense claiming a bit of a minefield.</p><p>For example, the amount that you claim back for mileage will depend on the number of miles travelled. You'll be able to claim back more for your first 10,000 miles whilst even the vehicle that you drive will affect the tax.</p><p>You'll also need to be careful of the <a href="https://gorillaaccounting.com/resources/gorilla-guides/24-month-rule/">24 month rule</a> which is used to define whether a workplace is temporary or permanent. You'll only be able to claim the big three expenses of travel, subsistence and accommodation if your workplace is temporary – that's to say that you don't expect to be working at a particular location for any longer than 24 months. </p><p>Aside from these basic costs, there are a whole host of other expenses which can be claimed from your business, including:</p><ul><li>Accountancy fees</li> <li>Costs incurred by working from home</li> <li>Computer equipment</li> <li>Insurance</li> <li>Mobile phone</li> <li>Work-related subscription services</li> <li>Training and development</li> <li>Business entertaining</li> <li>Annual events</li> <li>Essential clothing and equipment</li> </ul><p>Whilst almost every business expense must be 'ordinary and necessary', there's still scope to be able to treat yourself and your staff to perks without adding to your tax payments.</p><h2>Trivial Benefits</h2><p>In a nutshell, you're able to spend up to £50 on benefits for each staff member as long as it isn't cash, a cash voucher, a performance related reward or isn't in the terms of their contract. You can't spend more than £300 per staff member per year on trivial benefits, but they're a great way to account for special occasion gifts without burdening your tax bill. In addition to this, there's a £150 per head allowance for staff annual events which can cover the cost of annual staff Christmas parties, etc. </p><h2>Manage expenses on the go with FreeAgent</h2><p>It's all well and good understanding business expenses but tracking them accurately throughout the weeks and months can be a different beast altogether. Fortunately, there are plenty of tools available to help limited companies keep a record of each expense, one of the most common of which is <a href="https://gorillaaccounting.com/our-services/online-bookkeeping-software/">FreeAgent</a>.</p><p>Once you've appointed Gorilla Accounting as your accountant, you'll have access to the online platform, FreeAgent.</p><p>How many times have you misplaced that train ticket receipt from a long commute or thrown away a VAT receipt in error? Don't worry, it happens to the best of us, but not so with FreeAgent. As well as being able to track your bank balance, invoices and tax dates, one of the most prominent features is the ability to upload receipts and expenses. </p><p>Simply photograph receipts using your smartphone, tablet, laptop or other device and they'll immediately be stored in your FreeAgent profile meaning that the days of spiked paper receipts are well and truly behind us! </p><h2>How can we help?</h2><p>As well as providing all of our clients with access to FreeAgent, your dedicated accountant will always be on hand to offer one to one advice throughout the year as you need it. You'll be given a direct dial telephone number for easy contact, as well as being able to arrange face to face meetings, video conferences and e-mail exchanges as needed. </p><p>We'll be able to help you navigate your way through the maze of different expenses, all included in our simple monthly pricing plan of £85 + VAT per month.</p><p><strong>To register your interest in appointing Gorilla Accounting as your accountant, <a href="https://gorillaaccounting.com/contact-us/general-enquiries/">contact us</a> today and a member of the team will be in touch to talk you through the most beneficial time to switch.</strong></p> Thu, 04 Oct 2018 11:30:00 +0100 https://gorillaaccounting.com/blog/limited-company-guide-to-expenses Checklist to trading as a Limited Company https://gorillaaccounting.com/blog/checklist-to-trading-as-a-limited-company <p><strong>So you've got a great business idea that's going to propel your professional life into the stratosphere, but how do you go about actually getting a <a href="https://www.youtube.com/watch?v=bDDQfwjia5A&amp;t=5s">limited company up and running</a>?</strong></p><p>In this blog, we'll take a look at the four key steps that you'll need to take in order to create your limited company, from <a href="https://www.youtube.com/watch?v=YUD3u6xumQs">initial incorporation</a> through to managing your accounts. </p><h2>Register your business with Companies House</h2><p>So, the very first step you'll need to take when setting up a limited company is to register it with Companies House. Whilst, in essence, this isn't too taxing, you will need to do a fair amount of planning before diving into the incorporation.</p><p>Firstly, you're going to need a <a href="https://www.youtube.com/watch?v=YUD3u6xumQs">suitable company name</a> which can't be the same (or very similar) to another business or contain any explicit or offensive language. You'll also need an official business address, at least one named director, information on company shares and the Standard Industrial Classification (SIC) code of your business. The latter isn't anywhere near as complicated as it sounds – it just describes what your business actually does. </p><p>It's then just a case of sending all of this information over to Companies House so that your information can be verified, and confirmation of incorporation can be issued.</p><h2>Open your Business Bank Account</h2><p>With the company now formally incorporated, the next step is to make sure that there's a dedicated bank account for your income and expenditure. You'll need to use a specialist business bank account so that company funds are kept separate from your own, plus it makes financial auditing significantly easier for you to manage. </p><p><a href="https://gorillaaccounting.com/our-services/bank-accounts-contractors-freelancers/">Business bank accounts</a> come with a number of essential features that you're likely to need throughout your time trading. You'll typically have online banking for easy financial management and a debit/credit card so that you can make business purchases online and on the move. </p><h2>Set up your Business Insurance</h2><p>The <a href="https://gorillaaccounting.com/our-services/freelancers-contractors-insurance/">insurances</a> that you'll need to operate your business will largely depend on the industry that you're in and your contract.</p><p>However, there are a couple of essential insurances that you'll need to legally run a business in the UK as well as those which can help you save a fortune, should the unexpected happen.</p><p><strong>Professional Indemnity</strong> | Protects you against claims of professional negligence, making a professional error or giving bad advice which results in financial loss.</p><p><strong>Public Liability</strong> | Protects you against claims if a person, place or property is damaged as a result of your actions. This is also a must have if you work from home since clients could still pursue legal action if injured at your property.</p><p><strong>Employers' Liability</strong> | Compulsory for almost every UK business, Employers' Liability insurance protects against legal action from employees. This could be due to factors such as a work-related injury or contractual disputes.</p><h2>Appoint a specialist accountant</h2><p>Finally, you're going to need an expert accountant to tie all of your business finances together. It's not just income and expenses that need to be taken care of – payroll, invoices, dividends, tax returns and a whole host of financial tasks need to be professionally managed to ensure that your company records are up to date and submitted on time.</p><p>Once you appoint an accountant, we'll help to get your limited company up and running by incorporating your business with Companies House, setting up your business bank account, offering helpful advice on your essential insurances and much more.</p><p>As a client of Gorilla Accounting, you'll have a direct line, e-mail and video conferencing access to your dedicated accountant who will be on hand to help you every step of the way.</p><p><strong>For more information on the full range of services offered by Gorilla Accounting or to begin the process of appointing us as your accountant, <a href="https://gorillaaccounting.com/contact-us/general-enquiries/">contact us</a> today and a member of the team will be in touch to discuss your options.</strong></p> Thu, 04 Oct 2018 11:00:00 +0100 https://gorillaaccounting.com/blog/checklist-to-trading-as-a-limited-company Dan & Ian – London Marathon 2019 https://gorillaaccounting.com/blog/dan-ian-london-marathon-2019- <p>Each year, the London Marathon raises millions of pounds for charities, projects and communities around the world. </p><p>In fact, the 2017 marathon still holds the world record for the most money ever raised by a single day event with a whopping £61.5m donated to various causes.</p><p>This time, <a href="https://www.linkedin.com/in/dan-fallows-68548317/">Dan</a> and <a href="https://www.linkedin.com/in/ian-kay-bb40b540/">Ian</a> from Gorilla Accounting will be taking on the gruelling 26.2 mile challenge with the aim of raising £5,000 for The Footprints Foundation. </p><p>The <a href="https://senecapartners.co.uk/">Seneca Group</a> has been heavily involved with the Foundation over a number of years, supporting vulnerable people of all ages across a huge spectrum of community projects. Having seen the impact that the Foundation has on these projects, it made perfect sense to choose it as their marathon motivation!</p><p>After watching thousands cross the finish line of the 2018 London Marathon, like many of us, Dan felt inspired to do the same. Unlike many of us, he's actually following through with it but still needed a partner for the arduous journey ahead.</p><p>Fortunately, Ian was only down the corridor and rumour had it that he dabbled with a bit of running himself. In fact, over the last few years, he has developed a genuine love for the stuff, tackling endurance mud challenges and regular runs to keep fit. </p><p>Dan's fitness regime considers the more traditional, but no less punishing, the sport of boxing. After training with the Manchester United youth team as a youngster, he made the seamless transition into the squared circle and credits it with his current fitness levels. </p><h2>What Is The Footprints Foundation?</h2><p>The Footprints Foundation was set up to help disadvantaged people to enjoy a fulfilling life. They are helped each year by volunteers who have supported projects in India, Sri Lanka, Ecuador and Bulgaria before beginning their current focus on South Africa in 2007.</p><p>Although volunteers are of course an essential part of The Footprints Foundation, they cannot support local communities without financial support which is why Dan and Ian hope to get plenty of support in meeting their £5,000 target.</p><p><strong>Some of the projects that will benefit include:</strong></p><p><strong>Sithabile Youth &amp; Child Centre</strong> | An orphanage based in Beroni, Sithabile Youth and Child Centre provides a number of initiatives to improve the lives of young people in their community.</p><p><strong>Zenzeleni Village Centre</strong> | A community-based orphanage which sleeps up to 40 children and feeds up to 400 children from the surrounding areas on a daily basis.</p><p><strong>Little Angel's Children's Home</strong> | Run by a 27-year-old woman since the death of her mother in 2006, Little Angel's Children's Home specifically looks after children with HIV/AIDS or those who have been abandoned by their parents.</p><p><strong>Masibambane Community Centre</strong> | This community centre was created in 2000 by local people who had lost friends and family in the poverty-stricken ghettos of Lawley.</p><h2>How can I support the fundraising?</h2><p>Whilst we'll be doing plenty of fundraising ourselves between now and the London Marathon 2019, you can help to support the very worthy cause of The Footprints Foundation by visiting <a href="https://www.justgiving.com/fundraising/isabelle-iley">Dan &amp; Ian's JustGiving page</a>.</p><p><strong>Every single penny raised from their efforts will help to make a huge difference to vulnerable people, young and old, around the world.</strong></p> Fri, 28 Sep 2018 19:00:00 +0100 https://gorillaaccounting.com/blog/dan-ian-london-marathon-2019- Craig & Adele – Project South Africa 2018 https://gorillaaccounting.com/blog/craig-adele-project-south-africa-2018 <p><strong>The <a href="http://www.thefootprintsfoundation.co.uk/south-africa-3/">Footprints Foundation</a> is a UK based charity which was set up to help improve the lives of vulnerable people, young and old, around the world.</strong></p><p>In 2007, the charity launched Project South Africa, an annual volunteering programme which puts hands on the ground rather than solely providing financial support.</p><p>This year, <a href="https://www.linkedin.com/in/craigwhelan/">Craig Whelan,</a> our New Business Manager is amongst those volunteers offering their help to orphanages and community care centres across the region.</p><p>Inspired by the Foundation's ethos of, 'be about doing something, not about being somebody', Craig and his wife, Adele, will visit a number of key sites supported by The Footprints Foundation.</p><p>They'll be on hand to provide help and support in any way they can, including: </p><ul><li>Painting and decorating</li> <li>General buildings maintenance</li> <li>Food preparation</li> <li>Agriculture</li> <li>Food distribution</li> <li>Coaching</li> <li>Counselling</li> </ul><p>The Footprints Foundations was originally launched by Seneca Director, <a href="http://www.thefootprintsfoundation.co.uk/trustees-2/">Bob Holt</a>, and Craig explained that Bob's presentation on the initiative played a big part in his involvement.</p><p>“Following Bob's presentation on the Foundation at the 2016 Seneca conference, and the work that they have done to change people's lives, I felt compelled to get involved and help to make a difference.”</p><p>He added: “Based on this, me and my wife decided to join the Project South Africa team this September. This great charity is making a difference to people's lives where it is really needed the most. This will give us the amazing opportunity to see first-hand what difference The Footprints Foundation is really making, and allow us to get stuck in and help out.”</p><h2>What is Project South Africa? </h2><p>Project South Africa began in 2007 and has seen The Footprints Foundation taking back volunteers every year since. They support a number of South African orphanages and community centres in Benoni, Zenzeleni and Masibambane.</p><p>As with Craig and Adele, volunteers are a vital part of the project and many join the team each year to help assist with the ongoing maintenance and development of the partner projects.</p><p>Here's a closer look at who they'll be helping:</p><p><strong>Sithabile Youth &amp; Child Care Centre |</strong> The Sithabile Youth &amp; Child Care Centre is a non-profit community project that provides outstanding initiatives for local children and families.</p><p><strong>Zenzeleni Village Centre |</strong> Managed and run by two sisters, Lucia and Lindi, the Zenzeleni Village Centre is a community-based orphanage which takes on the responsibility of feeding up to 400 children per day from nearby schools and villages. </p><p>It's no exaggeration to say that parts of the community would struggle without their services, making it such a worthy part of The Footprints Foundation project. </p><p><strong>Little Angels Children's Home |</strong> This incredible social service is run by a 27-year-old woman who took over the orphanage after her mother passed away in 2006. Many children that use the facility are either HIV/AIDS orphans or are no longer with their parents, meaning that the shelter and food they receive is genuinely lifesaving.</p><p>As sponsorship increases, more money will be available for medication and counselling, helping these children to live long, healthy and meaningful lives. </p><p><strong>Masibambane Community Care and Support |</strong> The Masibambane Community Care and Support organisation was founded from tragedy following the death of a number of men, women and children in poverty-stricken ghettos of Lawley. HIV/AIDS support and treatment is available as well as hot meals, education and development courses.</p><p>They serve a huge spread of the local community with adults and children both welcome.</p><h2>How can I help?</h2><p>Whilst many of the positives that will come out of Craig's trip will be as a result of his hands-on work, there's no denying that financial support plays a huge part in the ongoing success of these projects.</p><p>So far, Craig and Adele have raised more than £4,000 for this fantastic cause, but the fundraising doesn't stop there. Every penny can help to make the world of difference to these communities, so whether it's £1 or the proceeds from a bigger fundraiser, all donations are wholeheartedly welcome!</p><p><strong>Check out the official <a href="https://www.justgiving.com/fundraising/craigandadelesouthafrica">JustGiving</a> page for more information on how you can donate.</strong></p><p> </p><p> </p><p> </p> Thu, 27 Sep 2018 10:30:00 +0100 https://gorillaaccounting.com/blog/craig-adele-project-south-africa-2018 The 24 Month Rule https://gorillaaccounting.com/blog/the-24-month-rule <p>When it comes to managing your contractor finances, keeping on top of your expenses can help to significantly reduce costs whilst ensuring that not you, but your business, takes the hit on these outgoings.</p><p>One of the most commonly claimed form of expenses is for business travel, but there's often a lot of confusion about what can and can't be claimed. This is particularly relevant when it comes to contracting at the same site for a long period of time, primarily due to the 24 month<a href="https://gorillaaccounting.com/resources/gorilla-guides/24-month-rule/"> rule</a>.</p><p>In its simplest form, the 24 month rule states that you can claim travel expenses to a temporary workplace for up to two years. It might sound easy to grasp, but there's a few grey areas that contractors can get bogged down in.</p><p>For example, what constitutes a temporary workplace? Does the 24 months ever reset back to zero? What if I move sites but still work for the same client?</p><p>In this guide, we'll take a closer look at exactly how the 24 month rule works and what steps you can take to minimise its financial impact on your business.</p><p> </p><h2 class="green-text">What Is The 24 Month Rule?</h2><p>We've already touched on a basic definition of the 24 month rule, but there's a little more to it when you start to dig around under the bonnet.</p><p>First things first, let's take a look at a few helpful definitions. The 24 month rule has been in place since 1998 and specifies that travel expenses can only be claimed for trips to a 'temporary workplace'. A workplace is classed as temporary so long as the circumstances of the contract fall under one of the following categories:</p><ul><li>The engagement is for less than 24 months</li> <li>The engagement period is as yet unknown but assumed to be under 24 months</li> </ul><p>Secondly, it's well worth noting that you'll no longer be able to claim travel expenses from the date you're made aware that you'll be working on the same location for a longer period than 24 months.</p><p>For example, this may well come into play if you've been travelling to a temporary workplace for 18 months and are then offered a 12 month contract extension. From the date this contract extension is signed, you'd no longer be eligible for travel expenses to this location as you'd be well aware that the contact will exceed the 24 month cut off.</p><p>Finally, the 24 month rule will kick in as soon as you've spent, or anticipate spending, more than 40% of your time at a given location during a two year period or more.</p><p> </p><h2 class="green-text">How Can The 24 Month Rule Affect My Business?</h2><p>If you don't invest time in planning ahead for the 24 month rule then the impact on increased travel costs can be detrimental to your cash flow. As a working example from the time of writing (September 2018), the short 45 minute train trip from Guildford to London Waterloo already exceeds £5,000 per year and that's without the added cost of essential tube and bus travel.</p><p>Whilst this is a relatively short commute, those travelling further afield or even abroad will face far harsher ticket costs. The same can be said for businesses who are responsible for the travel costs of multiple employees with long term, on-site contractors a more common proposition for employers than taking on permanent members of staff.</p><p>The best way to negate the impact that added travel costs can have on your business is to prepare for them well in advance by factoring them into your financial budgets and customer quotations.</p><p> </p><h2 class="green-text">Can't I Just Take A Break Or Move To A Different Site?</h2><p>One of the most common responses that clients offer to the 24 month rule is that they'll simply change sites or office locations. On the surface it seems like a sensible option, but you'd need to make a significant change to your daily commute.</p><p>Again, the definition of significant is a bit of a grey area and a contentious topic of debate, but by applying a common sense approach you'll get an idea as to what could reasonably deemed significant and what isn't. For instance, if you usually take the train and tube to work and have now moved into an office one stop further along the same line, it's likely to have very minimal on your travel time and costs. However, if you were now commuting by car 30 miles in the opposite direction of your existing site then this would lead to a significant increase in your travel costs meaning you could continue claiming expenses.</p><p>The same can be said for if you're working for the same client but in a different location. The 24 month rule is specific to travel costs and so therefore the client you're working for has absolutely no bearing on your ability to claim.</p><p> </p><h2 class="green-text">Why Gorilla Accounting?</h2><p>At Gorilla Accounting, we've accumulated decades of experience helping growing contractors and freelancers to manage their accounts efficiently and effectively. We've helped hundreds of clients to better understand the 24 month rule, ultimately improving the way that contracts are structured to account for the increase or decrease in travel costs.</p><p>Once you've appointed us as your accountancy services provider, you'll be allocated a dedicated accountant who'll work with you to better understand your business and improve your financial management. They'll explain how you can best prepare for future travel costs, particularly if you're approaching the 24 month cut off. You'll have unlimited, unrestricted access to them via telephone, e-mail, video conferencing and even face to face meetings without the fear of increased fees or hidden charges.</p><p><strong><a href="https://gorillaaccounting.com/contact-us/general-enquiries/" target="_blank">Contact Us</a> today for more information on the features and services offered by Gorilla Accounting or to begin the process of appointing us as your one stop shop accountant.</strong></p> Mon, 10 Sep 2018 14:15:00 +0100 https://gorillaaccounting.com/blog/the-24-month-rule