10 Recent Blog Posts https://gorillaaccounting.com/blog/ Shows a list of the 10 most recent blog posts. Top LinkedIn Tips For Freelancers and Contractors https://gorillaaccounting.com/blog/top-tips-linkedin-freelancer-contractor/ <p> LinkedIn can be a tough platform to crack for freelancers and contractors. With it fast becoming one of the most actively used social media platforms, it can feel almost impossible to stand out from the crowd.</p><p>As expert <a href="https://gorillaaccounting.com/">contractor accountants</a>, we have a wealth of experience when it comes to helping our clients improve their presence on LinkedIn – especially freelancers and contractors. There are a few simple tips you can follow to ensure you’re getting noticed for the right reasons.</p><h2><strong>Get The Basics Right</strong></h2><p>It’s essential to have all of the basics in place before building a presence on LinkedIn. We have provided a quick overview of some of the main things you must do to properly optimise your LinkedIn profile:</p><h3><br><strong>Upload A Profile Picture </strong></h3><p>A simple but extremely effective step that any contractor or freelancer should take when using LinkedIn. It’s essential that prospective employers can put a face to the name and quickly identify that you are in fact, a real person.</p><p>We are quick to judge people based on pictures, so to be sure that you’re making the right first impression you should follow these top tips:</p><ul><li> <p>Use a professional picture and ensure you’re dressed smartly.</p> </li> <li> <p>Always use a solid background and try to avoid any distracting backdrops in your picture.</p> </li> <li> <p>Always pose solo in your LinkedIn profile pictures and be sure to place emphasis on your face. We’d recommend cropping anything below your shoulders out.</p> </li> </ul><h3><strong>Add Headline &amp; Current Position</strong></h3><p>The headline is probably one of the most important parts of your profile, as when people search on LinkedIn, the results are pulled in from here. Therefore, it’s essential to optimise your headline to include important keywords that are closely related to what services you provide.</p><p>When you input your current position, it will immediately autofill your headline with the same information, so we advise you to take the time to change this to a more targeted key phrase related to your field of expertise.</p><p>Ensuring that your profile is visible to those who are in your field is important, as your profile needs to be among the first to show up in search results when prospective employers type in the services you provide.</p><h3><strong>Add A Detailed Bio</strong></h3><p>The final step you need to take to guarantee your profile is fully optimised is adding a detailed bio. We recommend keeping it as concise as you can, adding only relevant skills and experience.</p><p>You want to ensure you are selling yourself in your bio, whilst steering clear of wordy sentences. Short and snappy is definitely the way forward for this section, so be sure to keep things to the point; show prospective employers the confidence that you have all of the skills required to complete work for them.</p><h2><strong>Connect With Key Individuals In Your Sector</strong></h2><p>Now that your profile is perfectly optimised, it’s time to start connecting with the right people. Taking the time to connect with people that are genuinely in line with your sector is essential, as it can help you forge meaningful relationships with prospective employers.</p><p style="text-align: center;"><img class="leftAlone" title="" src="https://gorillaaccounting.com/assets/Uploads/_resampled/ResizedImageWzYwMCw0MDBd/Cheerful-man-using-laptop-working-at-home.jpg" alt="Cheerful man using laptop working at home" width="600" height="400"></p><p>Make a list of all the skills you have or services you can provide and search for these on LinkedIn’s search bar. You’ll likely find plenty of relevant professionals to connect with this way, and you can be absolutely sure you’re finding the right kind of people who will be open to building a mutual business relationship with you.</p><p>Drop them a courtesy message if they do choose to connect with you, but don’t push your services right away. Just engage in general chat instead of launching straight into your services and expertise, as this can help to gain a rapport with your new connection prior to selling yourself. Most people on LinkedIn are quick to offer up their services, and whilst this can work from time to time, it usually results in new connections ignoring your messages from the off.</p><h2><strong>Prioritise Key Jobs You’ve Carried Out</strong></h2><p>When going through your previous experience, more emphasis should be placed on your more recent and relevant projects and work to highlight the current experience you have in your industry. We would recommend spending a good amount of time on your last 1-3 years of experience, adding in plenty of detail about the jobs you have worked on, and providing examples of work where appropriate. When it comes to freelance and contract work, employers will want to see your most recent work to get a feel for what you can do, so be sure to focus on this when optimising your LinkedIn profile.</p><p>Whilst you should place plenty of focus on your more recent projects, don’t completely neglect previous experience from years gone by. Whilst you shouldn’t be expected to provide a huge amount of detail on older projects, it’s still a good idea to list these in your experience and have a couple of bullet points detailing your main responsibilities during those roles.</p><h2><strong>Consider a Portfolio</strong></h2><p>Now that you have your key roles listed on your LinkedIn profile, it’s time to think about putting together a more detailed portfolio to really sell yourself and your services to LinkedIn users.</p><p>LinkedIn has a dedicated area for helping users showcase their work in a portfolio, so you need to take some time pulling all the most impressive pieces of work you’ve put together into this section.</p><p>If you have a website, be sure to add a link back to it in this section, as the chances are that your connections will want to take a closer look at more work you have produced on your website.</p><p>As vastly experienced <a href="https://gorillaaccounting.com/contractors-limited-company-accountants/">limited company accountants</a>, we can’t stress enough just how important filling the portfolio section of your LinkedIn profile is. It genuinely helps to add some weight to the statements you mention in your description, showcasing the incredible work that you have already put together for other employers.</p><p>We believe that having a strong portfolio can be the difference between securing a job and not in some cases, so it always pays to invest your time into optimising this section of your LinkedIn profile.</p><h2><strong>Push Endorsements</strong></h2><p>If you have recently just carried out a contract with an employer, it’s a great idea to ask them to endorse you for some of the key skills listed on your LinkedIn profile. This is a quick and easy way to show prospective employers that you are trusted by other businesses and provide high-quality work.</p><p>Alongside LinkedIn endorsements, why not ask for a testimonial from any employers you have worked closely with? Testimonials are a fantastic way to highlight your previous work, with the backing of a former employer. They’re also a great shareable asset that you can utilise on your LinkedIn profile, further highlighting how prospective employers can be sure you are the right person to pick up any contracts they have put out to tender.</p><h2><strong>Keep Active</strong></h2><p>This may sound obvious, but it’s essential that you’re active in the LinkedIn community on a regular basis. It’s important that you post valuable updates and comments, as well as being quick to react to the latest industry news. You should also give updates on your services or availability among other noteworthy posts.</p><p>Remember to mix up your post styles where appropriate too; we’d consider switching between the following styles of LinkedIn post on a regular basis:</p><ul><li> <p>Service-based posts</p> </li> <li> <p>Reaction to industry news</p> </li> <li> <p>Picture/video led posts</p> </li> <li> <p>Testimonial posts</p> </li> <li> <p>Portfolio showcase to highlight recent projects you’ve worked on</p> </li> </ul><p style="text-align: center;"><img class="leftAlone" title="" src="https://gorillaaccounting.com/assets/Uploads/_resampled/ResizedImageWzYwMCw0MDBd/Cheerful-young-freelancer-is-smiling-typing-on-his-laptop-in-nice-modern-work-station-at-home.jpg" alt="Cheerful young freelancer is smiling typing on his laptop in nice modern work station at home" width="600" height="400"></p><p>Posting anywhere between once a day and once a week is more than enough, as essentially you are looking to show that you’re an active presence within your industry. Whenever you post, you’re simply reminding your connections that you are ready and able to help should they need assistance from a contractor or freelancer.</p><p>The biggest piece of advice we can give you is don’t post for the sake of it. Always make sure that any post you are putting on LinkedIn is adding value to your profile and your connections. If you’re consistently getting no interaction with any of your posts, it’s probably time to consider changing your approach.</p><h2><strong>Stand Out From The Crowd</strong></h2><p>If you’re struggling to secure work and all traditional avenues of LinkedIn aren’t working for you, then it’s time to start thinking out of the box.</p><p>If you’re not camera-shy, make some videos, that you can post directly to LinkedIn, of you discussing anything industry-related that’s on your mind. Showing you are confident enough to put yourself in front of the camera is a fantastic way to showcase your abilities to prospective employers. You could also utilise videos to get in touch with your connections, as this will definitely stand out in their inbox from other messages.</p><p>Joining in discussions on topics relevant to your field and adding your expertise is also a fantastic way of helping you to stand out from your competition. This is especially true when you have some real hard-hitting insight that can really get people talking.</p><p>There are plenty of ways to really make your profile stand out from the competition, but instead of scouring the internet looking for inspiration, we’d recommend that you take some time aside to brainstorm and think what may work for you.</p><p style="text-align: center;"><img class="leftAlone" title="" src="https://gorillaaccounting.com/assets/Uploads/_resampled/ResizedImageWzYwMCw0MDBd/Professional-designer-woman.jpg" alt="Professional designer woman" width="600" height="400"></p><p>So, there you have it, you’re ready to take LinkedIn by storm and start securing more work as a freelancer or contractor. We hope that you can implement these changes to your profile and begin to find more businesses actively seeking work from you in the near future.</p><p>If you do require any assistance from <a href="https://gorillaaccounting.com/sole-trader-accountants/">sole trader accountants</a>, Gorilla Accounting are here to help. We have vast experience providing <a href="https://gorillaaccounting.com/">accounting for contractors</a> and take great pride in ensuring that you take home as much of your pay as possible from each project you work on.</p><p>We utilise <a href="https://gorillaaccounting.com/free-agent-book-keeping-software/">FreeAgent accounting software</a> to ensure that all of our customers have access to an industry-standard cloud-based accountancy portal. You can rest assured that, when you work with Gorilla Accounting, we have your best interests at heart, and utilise our technology-driven approach to ensure we always provide you with unbeatable levels of service all year round.</p><p>Want to find out more about how we can help you? Feel free to get in touch today by either calling us on <a href="tel:03300240406">0330 024 0406</a> or by using our simple <a href="https://gorillaaccounting.com/general-enquiries/">online enquiry form</a>. We look forward to hearing from you soon.</p> Mon, 30 Nov 2020 15:51:41 +0000 https://gorillaaccounting.com/blog/top-tips-linkedin-freelancer-contractor/ Gorilla Accounting Support Christmas Party Heroes https://gorillaaccounting.com/blog/christmas-party-heroes/ <p><span style="font-size: 1.13em;">Gorilla Accounting is pleased to announce that we will be donating our Christmas Party budget to Xmas Party Heroes as we aim to support charities during this difficult time.</span></p><p>With Coronavirus cancelling staff Christmas party plans around the UK, we felt that it was essential to do some good with the unused money we would have put towards our office Christmas party.</p><p>With that in mind, we have decided to donate to Xmas Party Heroes, who are encouraging businesses to donate to charities in need by simply offering up the budget that would have otherwise gone towards a Christmas party.</p><p>It’s essential that we support charities now more than ever, and the team at Gorilla are exceptionally pleased that we can have an impact on those in need.</p><p>Richard Hepburn, Operations Manager at Gorilla Accounting, said: “We understand just how important it is to support local and national charities at Christmas time, and being able to do so with what would have been our Christmas party budget is fantastic. All of our team are delighted that we are helping those who really need it this Christmas.”</p> Mon, 30 Nov 2020 00:00:00 +0000 https://gorillaaccounting.com/blog/christmas-party-heroes/ Gorilla Sponsor Local Rugby Community Foundation https://gorillaaccounting.com/blog/sponsor-local-rugby-foundation/ <p>Gorilla is delighted to announce that we have become a Corporate Benefactor of Fylde Rugby Foundation.</p><p>The foundation provides free or subsidised programmes to schools, whilst also offering walking rugby to those over 50, so the older generation can keep active. There are also regular community holiday camps over school holidays and are designed to improve self-confidence, eye to hand coordination and social skills of young people.</p><p>Alongside their sporting activities, they also offer Breakfast Clubs in some of the most deprived areas of the Fylde coast; these sessions include fun and engaging wake-up games and tag rugby, followed by a hot breakfast to help kickstart the children’s day.</p><p>Here at Gorilla, we believe that the work they are doing for the surrounding area is invaluable, and that’s why we are so pleased to support them in their venture. It’s essential that we keep people of all ages across the North West active, especially in these trying times.</p><p>Director at Gorilla Accounting, Daniel Fallows, said: “It’s exceptionally important for Gorilla to continually invest in good causes from around the North West, and we believe that the Fylde Rugby Community Foundation is playing a vital role for a large number of people in the surrounding area.”</p> Tue, 24 Nov 2020 00:00:00 +0000 https://gorillaaccounting.com/blog/sponsor-local-rugby-foundation/ Contractors: Should I be paying National Insurance? https://gorillaaccounting.com/blog/contractors-should-i-be-paying-national-insurance/ <p>Are you new to contracting or thinking about becoming a contractor? Now is a great time to do it, as there are many advantages to being self-employed in this uncertain climate.</p><p>The COVID-19 pandemic has shown how easy it is for employees to be affected by something they can’t control, as many were left without a job. As a contractor, on the other hand, you have the opportunity to work with several clients and have different sources of revenue.</p><p>However, there are several things contractors should take into account, including National Insurance contributions, as they’re different from what you pay when you’re permanently employed. But, as <a href="https://gorillaaccounting.com/">contractor accountants</a>, we can help you manage this.</p><h2><strong>Do I Pay National Insurance as a Contractor?</strong></h2><p>National Insurance contributions are payable by most individuals who are working or are self-employed. The amount payable and type of National Insurance each person pays can vary depending on their earnings and individual circumstances.</p><p>If you’re a director or an employee, you pay Class 1 National Insurance and the rates for the tax year of 2020/21 are:</p><ul><li> <p>12% – if your pay is between £183 to £962 a week (£792 to £4,167 a month)</p> </li> <li> <p>2% – if your pay is over £962 a week (or £4,167 a month)</p> </li> </ul><p>As contractors are employees of their limited company, National Insurance will be payable on any salary income taken. <a href="https://gorillaaccounting.com/blog/-everything-you-need-to-know-about-dividends/">Dividend income</a> is not subject to National Insurance, so it’s usually tax efficient to take a small salary and the rest of your income as a dividend. This allows contractors to minimise their exposure to National Insurance and operate tax efficiently.</p><p>The key benefit of making some National Insurance contributions is that, by doing so, you’re able to build up an entitlement to claim state pension and benefits. This includes entitlement to the basic and additional State Pension, as well as benefits such as Employment and Support Allowance, Maternity Allowance and Job Seekers Allowance, amongst others.</p><h2><strong>National Insurance and State Pension</strong></h2><p>State Pension eligibility is based on the number of qualifying years that the employee has made National Insurance contributions. Entitlement to the New State Pension is subject to a minimum of 10 qualifying years on your National Insurance record – having 35 qualifying years will entitle the individual to the maximum amount of £175.20 per week.</p><p>An individual can request a State Pension statement to see how much they’re likely to get, as well as a National Insurance statement to check for any gaps in their National Insurance record.</p><p>When you own a limited company, you can pay yourself a small salary from your company which, in many cases, can be too small to attract any National Insurance contributions. However, in the tax year of 2020/21, you’ll still receive a qualifying year for National Insurance purposes if:</p><ul><li> <p>You earn, at least, £120 a week, £520 a month or £6,240 a year if you’re an employee</p> </li> <li> <p>You earn, at least, £125 a week, £540 a month or £6,475 a year if your self-employed</p> </li> </ul><p>Therefore, in most cases, it’s tax efficient for directors to pay themselves up to this level as they’ll continue to build up their National Insurance record without any actual National Insurance to pay.</p><p>In short, National Insurance and pensions are individual aspects of an overall tax efficiency strategy that needs to be considered by all contractors and freelancers operating through their own limited company. As well as the State Pension, contractors are able to pay into private pensions and gain further tax efficiency via their company while, at the same time, build up funds for their retirement.</p><h2><strong>Limited Companies and National Insurance</strong></h2><p>In addition to National Insurance payable by employees dependent on the level of earnings, your limited company is also required to pay Employers National Insurance on your behalf.</p><p>Typically, this is at a rate of 13.8% on all earnings above £169 per week, £732 per month or £8,722 per year. At present, your company can claim the Employment Allowance, which exempts the first £4,000 of Employers National Insurance.</p><p>Eligibility for this allowance is dependent on the structure of the company and the industry in which the company carries out its work.</p><p>Here at Gorilla Accounting, our <a href="https://gorillaaccounting.com/">accounting for contractors</a>’ service provides you with tailored support and guidance to all your tax-related queries. Additionally, we work alongside an Independent Financial Advisor who can advise on pensions and other aspects of personal financial planning.</p><p>When you become a client, we assist in ensuring you’re working in the most tax efficient way possible, so <a href="https://gorillaaccounting.com/general-enquiries/">contact us</a> today on <a href="tel:03300240406">0330 024 0406</a>.</p> Wed, 18 Nov 2020 00:00:00 +0000 https://gorillaaccounting.com/blog/contractors-should-i-be-paying-national-insurance/ Tax Efficient Life Cover Through Your Company Via an RLP https://gorillaaccounting.com/blog/tax-efficient-cover-relevant-life-policy/ <p>In 2006 a new type of life cover was introduced: the Relevant Life Policy or “RLP” (though sometimes also known as Relevant Life Cover) which is designed to act as a proxy to the typical ‘death in service’ cover that is provided to employees as part of their pension package, which pays out a multiple of their income as a tax free lump sum to loved ones on death.</p><p>This new product instantly became successful as it filled a gap to small businesses that had no way of providing such cover in a tax efficient manner and are too small to qualify for a group scheme. It is therefore extremely popular with Controlling Directors of their own limited company, such as contractors…</p><h2>Who can take out the cover?</h2><p>Relevant Life Plans have been designed for use by an employee, including directors of a business.  They are not available for Equity Partners of a Partnership, Equity Members of a Limited Liability Partnership, sole traders or anyone who is not an employee.  Shareholders of a limited company who are not employees or paid directors are also exempt from the cover.</p><p>For contractors, in a typical husband/wife scenario as shareholders, two individual policies could be taken out if necessary, as long as both are drawing a salary.</p><p>The cover can also be used by existing members of a group life scheme who want to top-up their benefits but are limited in the amount that is provided through their current scheme. </p><p>A little known and very important fact, in addition to topping up, it is also tax efficient way of taking out additional cover for those that will be affected by their pension Lifetime Allowance, as death-in-service pay-outs provided via a pension scheme count towards this allowance.</p><p><img class="leftAlone" style="display: block; margin-left: auto; margin-right: auto;" title="" src="https://gorillaaccounting.com/assets/Uploads/_resampled/ResizedImageWzYwMCw0MTld/iStock-177283857.jpg" alt="iStock 177283857" width="600" height="419"></p><h2>Tax implications</h2><p>While the contributions will be paid for by the company, they will not be treated as a benefit in kind on the life assured. Furthermore, contributions paid to fund the plan should be treated as an allowable business expense for the company and is dependent on how the arrangement is viewed by the Inspector of Taxes as it has to satisfy the wholly and exclusively rules. </p><p>The company will need to establish that any such contributions are made “wholly and exclusively” for the purpose of trade, profession or vocation.  This means the local Inspector of Taxes must be satisfied that the total remuneration package is commercially reasonable for work undertaken by the individual concerned e.g. this policy should therefore not be taken out to cover one’s personal mortgage.</p><p style="text-align: center;"><img class="leftAlone" title="" src="https://gorillaaccounting.com/assets/Uploads/_resampled/ResizedImageWzYwMCwzNjld/iStock-1168977155.jpg" alt="iStock 1168977155" width="600" height="369"></p><h2>Qualifying criteria</h2><p>To obtain the tax advantages, the RLP must meet the following criteria:</p><ul><li>Cover must be paid out in a single lump sum before the age of 75</li> <li>Plan cannot have a surrender value</li> <li>Benefits must be paid through a discretionary trust</li> <li>Beneficiaries are restricted to family members and dependents of life assured</li> <li>The main purpose of the plan must not be for tax avoidance </li> </ul><h2>What level of cover is available?</h2><p>Cover is based on a multiple of salary.  For contractors this can include both salary and dividends.</p><p>The cover does typically not include Critical Illness cover (though one provider does provide a dumbed down version), as this would typically taken out as a separate policy paid for on a personal basis.</p><h2>What happens if I close my company down?</h2><p>Because of IR35, some may be affected by these rules and must switch to a PAYE system and therefore no longer able to pay themselves through their limited companies in the same way.  For those who have taken out an RLP, this does not necessarily mean that the cover comes to an immediate end (though one can terminate it if no longer needed at any point).</p><p>It is normally possible to switch the policy from being employer based to personal cover, without further underwriting.  The insurance company would need to approve this and issue a new Direct Debit mandate.  Switching from a company-based plan would mean that one would lose the tax efficiency, but at least still be able to keep the cover.  One would also lose terminal illness cover, and going forward, it would not be possible to switch back to it being company based if ever circumstances were to change.</p><p style="text-align: center;"><img class="leftAlone" title="" src="https://gorillaaccounting.com/assets/Uploads/_resampled/ResizedImageWzYwMCwzOTBd/iStock-1199900941.jpg" alt="iStock 1199900941" width="600" height="390"></p><h2>How are benefits paid out?</h2><p>Relevant Life Policy plans are always written into a master discretionary trust at outset, which means that the benefit will be paid free from of Income and Inheritance Tax to the policy holder’s chosen beneficiaries, as per the “Expression of Wish” form which is completed alongside the trust form at inception.  It also escapes the lengthy process of probate, such that proceeds can be paid out swiftly.</p><p>At point of transfer, the proceeds will then form part of the estate of the beneficiaries.  To avoid a future Inheritance Tax charge on these benefits, the funds on death can be paid into an Asset Preservation Trust.  Here normal trust rules apply, regarding periodic and exit charges, though is usually not as expensive as getting taxed at 40%.</p><p>It is crucial that advice is taken to ensure that one’s personal circumstances are taken into consideration and that one does not fall foul of the rules.  Please contact your account manager who will be able to introduce you to a qualified advisor who will be able to source competitive rates and provide advice.</p> Wed, 18 Nov 2020 00:00:00 +0000 https://gorillaaccounting.com/blog/tax-efficient-cover-relevant-life-policy/ Government Extend Furlough Scheme To End Of March 2021 https://gorillaaccounting.com/blog/furlough-scheme-has-been-extended-until-march/ <p>In a statement to the House of Commons earlier today, Chancellor Rishi Sunak told MPs that the furlough scheme would be extended until the end of March, and will continue to pay up to 80% of an employee’s usual salary, up to £2,500.</p><p>As part of the scheme, Mr Sunak also made it clear that anyone made redundant after 23rd September can be rehired and put back onto furlough.</p><p>Richard Hepburn, Operations Manager at Gorilla Accounting said:</p><p>"Today's government announcement has offered a lot of reassurance to millions of people across the UK, as the furlough scheme had been due to end in December. The extension until the end of March is welcome news, as the end of furlough would have no doubt affected millions of employees, the self-employed and businesses across the country. </p><p>"With 80% of income continued to be covered by the government, there is some breathing space for employees and businesses despite the stress the second lockdown is set to put on the UK economy. It was hugely important to people across the country that the government provided an adequate level of support, and through this extension they have gone some way to achieving that."</p><p>Alongside the furlough announcement, Mr Sunak also laid out plans for billions of pounds of other support for the economy, with real focus being put on ensuring the self-employed are properly backed.</p><p>Through the Self-Employment Income Support Scheme, the government will cover up to 80% of average trading profits up to a maximum of £7,500 between November and January.</p> Thu, 05 Nov 2020 16:20:00 +0000 https://gorillaaccounting.com/blog/furlough-scheme-has-been-extended-until-march/ 50% off your first 3 months https://gorillaaccounting.com/blog/50-percent-off-your-first-3-months/ <p> </p><p>Sign up to Gorilla Accounting in November 2020 and get 50% off your fees for the first 3 months!</p><p><strong><a href="https://gorillaaccounting.com/sign-up/">CLICK HERE</a></strong></p><h2><strong>Terms and Conditions</strong></h2><p>Offer open to new clients taking on our Limited Company accountancy package, Buy to Let Landlord accountancy package or Sole trader accountancy package. We will reduce your monthly subscription by 50% for the first three months of your package. Offer does not apply to any other services or charges including but not limited to company formation, registered office services or any balancing charge. Offer only available to clients paying by monthly subscription. Payments must be up to date. Cannot be used in conjunction with any other offer. Offer may be withdrawn at any time. No cash alternative. Offer valid until 30th November 2020.</p> Mon, 02 Nov 2020 09:35:00 +0000 https://gorillaaccounting.com/blog/50-percent-off-your-first-3-months/ How Much Capital Gains Tax Do You Have to Pay When Disposing Of a Property? https://gorillaaccounting.com/blog/how-much-capital-gains-tax-do-you-have-to-pay-when-disposing-of-a-property/ <p>When you're disposing of a property, you’ll have to take certain things into consideration, from choosing an estate agent to sell the home, to deciding how much you want for it. You will also need to take Capital Gains Tax into consideration.</p><p>We're <a href="https://gorillaaccounting.com/">contractor accountants</a>, so we aim to help people understand how this tax works and when they must pay it in order to avoid penalties and interest fees.</p><h2><strong>What is Capital Gains Tax?</strong></h2><p>This tax rule refers to the profit you make when you sell (or ‘dispose of’) an asset that increased in value. For example, if you bought a house for £120,000 and it later sold for £150,000, you made a gain of £30,000 – in essence, you pay tax on the gain you make, not on the amount of money you received.</p><p>When it comes to Capital Gains Tax, ‘disposing of’ an asset can mean selling it, giving it away as a gift or transferring it to someone else, swapping it for something else, or getting compensation for it (for example, an insurance pay-out).</p><h2><strong>Private Residence Relief</strong></h2><p>While it’s true that you must pay Capital Gains Tax when disposing of a property, this is more directed at landlords than private homeowners. This is because you’re entitled to something called Private Residence Relief if you meet certain criteria.</p><p>This Private Residence Relief means you won’t have to pay Capital Gains Tax if the following applies when selling or disposing of your home:</p><ul><li> <p>You only have one home and you’ve used it as your main home since it came into your possession.</p> </li> <li> <p>You've not let any part of it out (though this doesn’t include lodgers).</p> </li> <li> <p>You’ve not used part of the home for business only.</p> </li> <li> <p>The ground and any buildings within are less than 5,000 square metres in total</p> </li> <li> <p>You didn’t buy the home just to make a profit.</p> </li> </ul><p>If you can’t meet all these requirements, you may have to pay some tax. If you’re married or in a civil partnership, you can only count one property as your main home.</p><h2><strong>Your Tax-Free Allowance</strong></h2><p>Just like your income tax, you also have a tax-free allowance when it comes to Capital Gains Tax (called Annual Exempt Amount). In the tax year of 2020/21, your allowance is £12,300.</p><p>According to the UK government, you also don’t typically pay Capital Gains Tax on gifts to your spouse or civil partner or to a charity, just as you don’t pay it on gains from ISAs, PEPs, bets, lottery wins, pool winnings, UK government gilts and Premium Bonds.</p><h2><strong>Capital Gains Tax Rates</strong></h2><p>If you pay 40% or 45% in income tax (meaning you pay a higher or additional rate), you’ll also have to pay 28% on your gains from residential property and 20% on your gains from other chargeable assets, like shares that aren’t on an ISA or PEP, business assets and most personal possessions worth £6,000 (except your car). These personal possessions include jewellery, paintings, antiques, coins and stamps.</p><p>If, on the other hand, you’re a basic rate income taxpayer, the Capital Gains Tax you pay will depend on the amount of the gain itself, your taxable income and the type of asset you made a gain from. So, you’ll have to:</p><ul><li> <p>Figure out the amount of taxable income you have</p> </li> <li> <p>Calculate your total taxable gains (work out the gain for each asset, add them together and deduct any allowable losses)</p> </li> <li> <p>Deduct your allowance</p> </li> <li> <p>Add the amount to your taxable income</p> </li> </ul><p>You'll have to pay 18% of Capital Gains Tax if the resulting amount falls within the basic income tax band.</p><p style="text-align: center;"><img class="leftAlone" title="" src="https://gorillaaccounting.com/assets/Uploads/_resampled/ResizedImageWzYwMCw0MDBd/Close-up-real-estate-agent-with-house-model-hand-putting-signing-contract2.jpg" alt="Close up real estate agent with house model hand putting signing contract2" width="600" height="400"></p><h2><strong>Deadlines to Keep in Mind</strong></h2><p>There is no specific time of year to pay Capital Gains Tax, considering each case is different. However, you have 30 days after the completion date to report and pay your tax on any property disposals after April 2020.</p><p>Because of the COVID-19 pandemic, HMRC didn’t issue late filing penalties to transactions completed between 6 April 2020 and 30 June 2020 as long as the gain was reported, and the tax paid, by 31 July 2020. However, if you don’t pay Capital Gains Tax within 30 days of completion, you’ll be charged interest, as this wasn’t deferred.</p><h2><strong>Reporting Capital Gains Tax</strong></h2><p>In order to report and pay this tax, you need a Capital Gains Tax on UK property account. Once you have it, you can report the disposal of the property, pay any tax owed and view/change previous returns.</p><p>If you don’t live in the UK, you have more to report, including:</p><ul><li> <p>Any residential UK property or land you have (this includes any buildings on the land)</p> </li> <li> <p>Non-residential properties or land</p> </li> <li> <p>Mixed use properties or land</p> </li> <li> <p>Rights to assets that get, at least, 75% of their value from land</p> </li> </ul><p>As <a href="https://gorillaaccounting.com/accountants-for-buy-to-let-landlords/">accountants for landlords</a>, we can help you figure Capital Gains Tax out and will be on hand to answer any questions you may have about selling your property. So, <a href="https://gorillaaccounting.com/general-enquiries/">contact us</a> today on <a href="tel:03300240406">0330 024 0406</a> to chat to us and we’ll be happy to assist with your accounts.</p> Fri, 30 Oct 2020 09:00:00 +0000 https://gorillaaccounting.com/blog/how-much-capital-gains-tax-do-you-have-to-pay-when-disposing-of-a-property/ Brexit and Self-Employment: What’s Next? https://gorillaaccounting.com/blog/brexit-and-self-employment-what-s-next/ <p>It's not just COVID-19 worrying contractors and freelancers at the moment, but also Brexit – whether or not they have clients in mainland Europe.</p><p>While the UK left the EU on 31 January 2020, it entered a transitional period until 31 December 2020 in which EU law is still applicable. So, with the transitional period coming to an end soon, it’s crucial that self-employed individuals are aware of what to do and how Brexit can affect their business.</p><p>As <a href="https://gorillaaccounting.com/">contractor accountants</a>, we make sure to stay up to date with the latest Brexit news, so that we can help you navigate the uncertainty around it. And, while this uncertainty is still prevalent, there are a few things you should know – and a few things you can do – to prepare your business ahead of the new year.</p><h2><strong>VAT Taxation after Brexit</strong></h2><p>One of the things that contractors will have to consider is VAT. Not all businesses have to register for VAT and pay this tax, only those with an annual turnover above the current threshold of £85,000 (for the current tax year of 2020/21). If your business has an annual turnover below this figure, you don’t have to register for VAT, although you can do so voluntarily.</p><p>After Brexit, it’s likely that the UK will leave the EU VAT area as well. This will have an impact on businesses that trade goods with countries within the European Union, and there will have to be changes to the way VAT works for freelancers and contractors in the UK and in the EU.</p><p>In the event of a no-deal exit, the self-employed will not be able to access the EU VAT refund system, which will certainly add to the admin business owners already have to do. It may also change how much tax they’ll have to pay. It's also possible that freelancers will have to pay VAT in each country they operate in.</p><p>The way VAT works will also change depending on whether you are providing physical or digital services or products.</p><p>After all, if you own a business in the UK and sell digital products to EU consumers, you were able to use the Mini One-Stop Shop (MOSS) scheme set up by the EU – this allowed you to submit only one VAT document (which had information from different member countries) in just one EU country. Since the UK will become a third country, you will probably be unable to use MOSS.</p><h2><strong>Intellectual Property Changes</strong></h2><p>Brexit will affect businesses that have to file intellectual property applications. The EU has harmonised intellectual property law across members states, including the UK, meaning freelancers and contractors will need to know their rights and what will change after Brexit, especially if we leave without a deal.</p><p>The UK will have to create new trademarks, which will likely be comparable to the existing EU trademarks, including filing dates. If there’s a no-deal Brexit, freelancers and contractors will have to give a UK address when applying for a UK trademark, while any address in the EEA is still enough at the moment.</p><p>If you’re a UK business owner living in the EU, you will likely not see any changes, since your EU trademark will still be valid in member states.</p><p>However, self-employed individuals may face some loss of protection after the nation leaves the EU. This is because the UK and the EU will no longer have reciprocal protection, something that can be covered in a trade deal – if there is none, many businesses may see their rights affected, such as database rights.</p><p>The EU has also implemented the Digital Copyright Directive, which the UK is unlikely to adopt; the government will not be part of the new Unitary Patent either.</p><h2><strong>Working with International Clients</strong></h2><p>Another thing to take into account is how providing services and products to EU and non-EU countries will look after Brexit. In many cases, business accreditation is necessary across EU member states, so, after Brexit, self-employed individuals in the UK may need to get separate accreditation if they want to continue working with international clients.</p><p style="text-align: center;"><img class="leftAlone" title="" src="https://gorillaaccounting.com/assets/Uploads/_resampled/ResizedImageWzYwMCw0MDBd/Woman-working-at-home.jpg" alt="Woman working at home" width="600" height="400"></p><p>And while many companies in the EU have chosen to work with UK freelancers and contractors, they did so while the UK was still part of the EU, as this meant less admin and frictionless trade. However, now that the transition period is ending, EU businesses may not want to hire UK workers if the process becomes too difficult or if it entails time-consuming paperwork.</p><p>Still, it’s worth remembering that, even though EU companies may not want to invest in permanent hires at the moment, the same can’t be said of contracting.</p><p>Contractors and freelancers can be hired on a project basis, so it’s easier to engage their services – and safer, considering the current uncertainty. So, even though there may be some issues for the self-employed when it comes to supplying products and services to the EU, there may also be plenty of opportunities.</p><h2><strong>Employment Law after Brexit</strong></h2><p>Because many EU employment laws and regulations have been implemented by the UK, there may be some changes after Brexit. However, the UK government has said it has no intention of making changes to the existing workers’ rights, which can help put some contractors and freelancers at ease.</p><p>However, employment law cases will no longer be referred from UK courts and tribunals to the ECJ (European Court of Justice). For UK freelancers and contractors in the EU, this is a simpler matter, as employment law will remain the same after 31 December.</p><p>If you’re a self-employed EU citizen working in the UK, more information or other requirements may be needed after Brexit, but details have not been decided yet.</p><h2><strong>Freedom of Movement is Ending</strong></h2><p>While UK freelancers and contractors can still move freely to and from EU countries, this will end after 31 December. If you’re a UK contractor or freelancer working solely in the UK, you won’t be affected by this. Still, if you have to travel to the EU for work, you may need a visa in the future, although this is still not decided.</p><p>If you want to move to the EU after the transition period has ended, you will need to check what is required for the specific country you’re interested in. This includes not only immigration laws but also rules around sole trading and owning a limited company.</p><h2><strong>Financial Vouchers for the Self-Employed?</strong></h2><p>The UK government is being urged to support the self-employed with financial vouchers designed to ease the transition after 31 December. Despite the fact that the end of the transition period is close, there is still no trade deal in place, which is leaving many contractors and freelancers in the dark.</p><p>Understandably, they’re concerned over what will change for them once the new year rolls around, which is why the Federation of Small Businesses (FSB) is requesting ‘transition vouchers’ to help them. These vouchers would give self-employed individuals a pre-determined amount of money to spend on training, technology and expertise.</p><p>After all, <a href="https://www.fsb.org.uk/resources-page/small-firms-call-for-transition-vouchers-as-uk-eu-negotiations-resume.html">according to FSB’s Chairman</a>, Mike Cherry, “the economy is in a very different place today compared to the last time we were told to prepare for a no-deal outcome. Small firms don’t have the time or money to get across new bureaucracy or stockpile.”</p><p>Contractors and freelancers are unaware of what may happen once the UK leaves the single market and customs union for good because there is no clear direction. It's crucial that the government clarifies what needs to be done going forward and what post-Brexit trading will look like.</p><p style="text-align: center;"><img class="leftAlone" title="" src="https://gorillaaccounting.com/assets/Uploads/_resampled/ResizedImageWzYwMCw0MDBd/Cheerful-florist-on-phone-with-client-and-writing-down-their-order.jpg" alt="Cheerful florist on phone with client and writing down their order" width="600" height="400"></p><h2><strong>How Can You Prepare for Brexit?</strong></h2><p>Unfortunately, because no one knows for sure what will happen after the transition period, it’s impossible to say exactly what businesses need to do in order to thrive in a post-Brexit economy.</p><p>This doesn’t mean there isn’t anything you can do. On the contrary, you may want to look into some or all of the following:</p><h3><strong>Register for an EORI</strong></h3><p>If you’re a UK-only business, you don’t need to worry about this. However, if you trade with clients in the EU (or with non-EU countries), you will have to register for an Economic Operator and Registration Identification Number (EORI). This will allow you to move goods between the UK and the EU, so start looking into this now as there may be a high volume of applications soon.</p><p>This is free, which is good news for self-employed individuals, especially those starting out, as it means you don’t have to account for it in your budget. It's also a quick process, so it won’t take up a lot of your time.</p><h3><strong>Check Government Guidance</strong></h3><p>Be sure to check the government’s guides and information on what will happen after the transition period. This <a href="https://www.gov.uk/transition">guidance</a> should be able to answer some questions regarding anything from workers’ rights to IT systems in the event of a no-deal Brexit.</p><h3><strong>Diversify Your Work</strong></h3><p>Having several revenue sources is always important for freelancers and contractors, and this will be no exception after Brexit. This can help you to make up for any losses that can occur, so consider all your skills and think about what else you can start doing.</p><h3><strong>Make Sure You Can Get Paid</strong></h3><p>One of the major challenges ahead for self-employed individuals who work with international clients is getting paid. So, ensure that you have a system in place to receive payment and that this matches the new rules created by Brexit in order to remain compliant.</p><h3><strong>Do You Receive Personal Data from the EU/EEA?</strong></h3><p>If you receive personal data from the EU, you’ll want to make sure you stay compliant with the latest legislation. For example, according to the government, from 1 January 2021, businesses should have Standard Contractual Clauses (SCCs) with EU counterparts if they want to legally receive personal data from users in the EU.</p><h3><strong>Keep Other Issues in Mind</strong></h3><p>While getting ready for Brexit can take up a lot of time, contractors and freelancers shouldn’t lose sight of other key challenges, such as the upcoming IR35 reform. You will still need to comply with UK regulations, so make time to continue doing all the admin required for UK businesses, whether you’re a sole trader or limited company owner.</p><p style="text-align: center;"><img class="leftAlone" title="" src="https://gorillaaccounting.com/assets/Uploads/_resampled/ResizedImageWzYwMCw0MDBd/small-business-owner-with-client.jpg" alt="small business owner with client" width="600" height="400"></p><p>Brexit will impact the many freelancers and contractors that set up their businesses in the UK, but this doesn’t mean everything will be negative. There will still be new opportunities to take advantage of, so make sure you’re as ready as possible for when the transition period comes to an end.</p><p>As <a href="https://gorillaaccounting.com/contractors-limited-company-accountants/">limited company accountants</a> and <a href="https://gorillaaccounting.com/sole-trader-accountants/">sole trader accountants</a>, we can easily help you to stay compliant with the taxation side of your business, so <a href="https://gorillaaccounting.com/general-enquiries/">get in touch</a> today if you’d like to learn more about what we do. Our expert accountants are on hand to answer all of your questions, so leave us a message and we’ll get back to you or call us on <a href="tel:03300240406">0330 024 0406</a>.</p> Tue, 27 Oct 2020 15:46:44 +0000 https://gorillaaccounting.com/blog/brexit-and-self-employment-what-s-next/ What Can You Do Once Furlough Ends? (Updated) https://gorillaaccounting.com/blog/what-can-you-do-once-furlough-ends-/ <h2><strong>16-11-2020 UPDATE<br></strong></h2><p>The Job Support Scheme has now been postponed because the <strong>furlough scheme has been extended until the end of March 2021</strong>. Until then, the government will continue to pay up to 80% of an employee's usual salary, up to £2,500.</p><hr><p> </p><p>The pandemic has not only caused thousands of deaths but has also damaged the economy. Because of it, the UK entered into a recession on 12 August. Many businesses have struggled to stay afloat and made use of the government’s furlough scheme to pay their employees – this allowed them to keep their staff instead of having to let them go.</p><p>The furlough scheme has been critical during the pandemic but, now that the scheme is coming to an end, both companies and people are having to find other options. As <a href="https://gorillaaccounting.com/">contractor accountants</a>, we’re taking a look at what you can do once furlough ends and how you can make the most of the situation.</p><h2><strong>What Could the End of Furlough Mean?</strong></h2><p>The furlough scheme, which initially paid employees 80% of their salary up to a maximum of £2,500 per month, was reduced over the past few weeks and will end all-together on 31 October.</p><p>The scheme was designed to avoid mass redundancies, so it’s natural for companies and individuals to be concerned now that it’s coming to an end. There is a real chance that many individuals will be left out of work soon, since companies may not be able to afford paying their staff.</p><p>This means that both jobs and businesses could be at risk. However, it’s important to weigh in everything before making decisions with long-term ramifications. This is because the situation is not all doom and gloom, since the government will replace furlough with the Job Support Scheme.</p><p>In essence, because this scheme will help both employees and employers, business owners shouldn’t rush to close their companies as furlough ends. The new scheme is set to kick in at the start of November and was created to protect viable jobs in businesses that are facing lower demand over the winter months because of the pandemic.</p><p>Because we’re <a href="https://gorillaaccounting.com/contractors-limited-company-accountants/">limited company accountants</a>, we can help you understand what the new scheme will entail and how you can make the most of it. We also offer specialist advice designed to maximise your tax efficiency, so don’t hesitate to get in touch with us today.</p><h2><strong>The New Job Support Scheme</strong></h2><p>This scheme will start on 1 November 2020 and runs for 6 months. According to the government, a company will continue to pay its employees for the time of their work, but the costs of the hours not worked will be split between the employer, the government and the employee (through wage reduction).</p><p>If you are forced to shut your company temporarily due to coronavirus restrictions, the government will pay up to 67% of the wages of employees. The Job Support Scheme will be useful for businesses like pubs and restaurants, since they will be highly impacted if told to close because of stricter measures (Tier 3, for example).</p><p>The government’s contribution will be capped at £2,083.33 a month for each employee and staff must be off work for, at least, seven days. Employers don’t have to pay towards the staff’s salary.</p><p>Things are different if work is open but not busy. In this case, staff has to be paid by the employer to work a minimum 20% of their hours per month, and employers also have to pay an extra 4% of the total wages to cover for hours that are not worked.</p><p>The government pays 49% of the total wage to cover these hours, meaning employees will be able to earn a minimum of 73% of their normal salaries. The government's contribution is capped at £1,541.75.</p><p style="text-align: center;"><img class="leftAlone" title="" src="https://gorillaaccounting.com/assets/Uploads/_resampled/ResizedImageWzYwMCw0MDBd/business-owner.jpg" alt="business owner" width="600" height="400"></p><h2><strong>Other Government Help</strong></h2><p>As a business owner, you may also be eligible to claim the Job Retention Bonus.</p><p>This refers to a £1,000 one-off taxable payment made to the employer for each employee furloughed and kept employed until 31 January 2021. The bonus can be claimed between 15 February 2021 and 31 March 2021. You may be eligible if you furloughed employees and made an eligible claim through the Coronavirus Job Retention Scheme or through the new Job Support Scheme.</p><p>In addition to this, the government will also give companies £1,500 for every 16-24-year old they hire for a six-month work placement. You will also receive £2,000 for every under-25 apprentice taken on until the end of January 2021 (or £1,500 for over-25s).</p><h2><strong>Why Should You Opt for Self-Employment?</strong></h2><p>The end of the furlough scheme can be seen as an opportunity to pursue a career as a freelancer or contractor as well. If you’ve been considering this option, there is no time like the present, as there are many benefits to becoming self-employed in these uncertain times.</p><p>After all, the coronavirus outbreak has shown how easy it is for employees to be affected by things outside of their control. If you’ve been left without a job, for example, a career as a contractor or sole trader can help you to thrive financially.</p><p>In a less-than-stable environment, which is what we’re seeing at the moment, self-employment can mean having several sources of revenue, as well as low business costs if working from home. So, if an individual loses a job, he or she still has several other gigs or projects to fall back on.</p><p style="text-align: center;"><img class="leftAlone" title="" src="https://gorillaaccounting.com/assets/Uploads/_resampled/ResizedImageWzYwMCw0MDBd/businessman-working-on-laptop.jpg" alt="businessman working on laptop" width="600" height="400"></p><p>An employee, on the other hand, will lose all wages if let go and will have to hunt for a new job, something that is now more difficult due to the pandemic.</p><p>In addition, the Coronavirus Self Employed Income Support Scheme (SEISS) has been created to protect self-employed individuals in a similar way to permanent workers. In the winter economy plan, Rishi Sunak has introduced a first flexible grant at the start of November that will cover 40% of average monthly profits with a limit of £3,750.</p><p>This will be a single instalment covering three months’ worth of profits. The second grant will cover three more months from the start of February.</p><p>So, the end of the furlough scheme is not the end of the world for either businesses or employees. On the contrary, the government will continue to support companies across the UK and individuals can take this opportunity to become self-employed, whether through owning a limited company or by freelancing.</p><p>At Gorilla Accounting, we have helped countless self-employed individuals to grow their business, and we’re more than happy to help you to the same as well. <a href="https://gorillaaccounting.com/general-enquiries/">Get in touch</a> with our expert accountants on <a href="tel:03300240406">0330 024 0406</a> to discuss your needs and how we can help.</p> Mon, 26 Oct 2020 14:48:00 +0000 https://gorillaaccounting.com/blog/what-can-you-do-once-furlough-ends-/