Q: I currently operate a Limited company and have heard that the audit thresholds are changing. Do I still require to be audited?
A: Generally (but not always) a company is exempt from audit if it qualifies as a small company and is not part of a larger group or a charity.
The new limits come into effect for accounting periods commencing on or after 1st January 2016 and are:
1. Turnover under £10.2m,
2. Total assets under £5.1m
3. Under 50 employees.
To qualify as small you need to meet 2 out of the 3 criteria and also have qualified as a small company in the previous accounting period.
Q: My business is owed money. I want to recover it quickly and cost effectively. What’s the best way to do this?
A: It is important to quickly determine whether you believe the invoice may be disputed or not by your customer. If it is an undisputed invoice and the customer or client is just slow in paying or is ignoring the invoice, you may wish to consider, in the case of an individual, the service of a Statutory Demand (if the invoice exceeds £5000) or in the case of a limited company, the threat of a winding up petition (if the debt exceeds £750). This is a very robust mechanism to ensure a debtor sits up and takes notice. Both of these methods are the first step which could lead to the bankruptcy or winding-up of the individual or the company debtor.
The alternative, more common mechanism is to commence proceedings in the County Court. Depending on the value of the outstanding invoice, the matter would be dealt with either in the small claims track (less than £10,000 but with very limited costs consequences for either party) or alternatively, if over £10,000, with costs recoverable by the successful party. The County Court process can be time consuming, requiring one or more attendances at Court and the payment of Court fees at various stages. You can expect that if the debt is disputed, it could take 6-9 months to successfully obtain Judgment. You should also add, where appropriate, interest pursuant to The Late Payment of Commercial Debt Regulations 2013.
Q: How much can I take from my pension when I retire?
A: You could close your pension pot and take the whole amount as cash in one go if you wish. The first 25% (quarter) will be tax- free and the rest will be taxed at your highest tax rate – by adding it to the rest of your income.
There are many risks associated with cashing in your whole pot. For example, it’s highly likely that you’ll be landed with a large tax bill, it won’t pay you or any dependent a regular income and, without very careful planning, you could run out of money and have nothing to live on in retirement.
Q: I hear that Business Rates are being revalued in 2017. What does this mean for me ?
A: Business Rates are paid on most non domestic properties direct to your Local Authority. The tax is calculated from the The Rateable Value of the property (RV), which is the hypothetical rental value of the property on a date decided by the Rating Authorities. The current list of RV’s (the 2010 list) was based upon the rental value of the property as of the 1st March 2008, therefore in some areas of the country the RV may be out of sync with the rental value in the open market.
To correct this, the government are due to carry out a revaluation of all the RV’s in England Scotland and Wales in 2017.
Whilst this may mean an increase for some occupiers, the government are introducing a wider range of small business reliefs that will affect any property with an RV below £12,000. There is also a right of appeal, if you think that your new RV is wrong.
Rating can be a very complex field and therefore it is important to obtain good advice to make sure your RV is correct and that you are getting all the reliefs that you may be entitled too. Your Local Authority will be able to answer many questions, if you still feel you need some guidance, or want to appeal your RV then contact your local Chartered Surveyor.
Ayers & Cruiks
Q: How important is it to have a mobile optimised website?
A: As of the 21st April 2015, Google dramatically increased their ranking results on mobile ability. Google has since then released the ‘Hummingbird’ update, and they made it clear that the future of search is mobile and websites that aren’t usable on handheld devices will see their search rank suffer for it.
Your web content might look great on a desktop but will probably be unreadable on a mobile device. Visitors won’t stay on your site if they have to pinch and zoom or squint at illegible type, or worse yet if it runs flash or anything that requires add-ons to display in a browser. If your website isn’t optimised professionally for mobile your bounce rate (the rate people leave your site on the first page) on mobile devices is going to be extremely high. By providing mobile visitors with an appropriate and intuitive user experience you will obviously engage visitors longer and drive more of them to purchase or enquire.
If your mobile website is difficult to navigate customers are more likely to go to the competition than to visit you on a desktop computer. If you can’t provide what they need when they need it you will have lost the opportunity for the sale and risk losing a customer permanently to a competitor.
In short, if you haven’t acted yet, you must act now if you wish to remain on Google search.
Register of people with significant control
From April 2016, all private limited companies and limited liability partnerships registered in the UK have a duty to maintain a new public register – People with Significant Control (PSC).
From June 16, the PSC information will have to be disclosed upon the new confirmation statement which replaces the annual return that historically has been filed at Companies House.
The new PSC register is one of a number of changes to the Companies Act 2006 brought about by the Small Business, Enterprise and Employments Act 2015.
The aim of the Act is to create greater transparency in the ownership and control of UK companies, which will help inform investors when they are considering investing in a company. The provision of the additional information will also support the ongoing fight against money laundering.
Jo Travis – Barrons ([email protected])