R&D tax claims hit new high. Are you missing out?

The number of businesses claiming tax relief on Research and Development (R&D) has increased significantly, with the latest figures indicating a 24% rise in claims since last year.

The big question is, could you be eligible to make a claim?

The scope for identifying R&D is huge – in fact, it exists in every single sector and the HMRC R&D criteria is broad and far-reaching. In general, if you have spent money developing new products, processes or services; or enhancing existing ones, you could be eligible for R&D tax relief.

It’s easy to overlook the idea of R&D claims, thinking they are only applicable to large businesses or businesses investing significant sums.

However, many businesses may in fact be eligible to claim – especially since the original minimum R&D expenditure of £10,000 was removed in April 2012. This has opened the door for SMEs to claim back vital funds, and with the average SME claim in the UK coming in at £53,876 (2016-17), what are you waiting for?

Although many companies claim to be able to help with R&D claims, few actually have the knowledge and expertise.

The team at Stafford & Co have achieved great success for clients. One of our happy clients is Ben Griffiths of Clever IT, who we helped to reclaim over £8,000:

“Before speaking to Stafford & Co, I was unaware of R&D tax relief. However, they quickly explained how and why I would be eligible for this and efficiently put the claim together for me and submitted it to HMRC. I was over the moon, to find out that our claim had been successful, and I was reimbursed over £8,000. Thanks again Stafford & Co”.

So, if you’re looking to get 2019 off to a great start, we can’t think of a better way than to talk to us about making an R&D claim. Contact us on 01204 368 550 or email info@staffordandcompany.test.

An alarming number of businesses are still unaware of Making Tax Digital

Despite a great deal of discussion amongst the accountancy industry, recent research has suggested that a worrying number of businesses themselves don’t know about the forthcoming Making Tax Digital (MTD) changes. The research, by the Institute for Chartered Accountants in England and Wales (ICAEW), suggests over 40% of small firms soon to be mandatorily included in the UK Government’s MTD initiative remain unaware of the project.

This is obviously a concerning statistic – the ideal scenario for small businesses is for them to begin using new accounting software well in advance of the 1st April deadline so they can get used to the new methods.

But what exactly are the changes, who will they affect and what action do you need to take?

All UK VAT registered businesses above the £85,000 sales threshold will be required to make digital records and file VAT returns directly via MTD-approved software from 1st April 2019. Businesses must instead use ‘functional compatible software’ (digital records) that can connect to HMRC’s system via its API link to file their UK VAT returns.

This means that as of 1st April 2019, any business that applies VAT to its sales will no longer be legally allowed to keep manual records for accounting purposes. This includes paper records and applies to both sales and purchases for which VAT is claimed.

The process of manually keying-in VAT return data from spreadsheets into HMRC’s online portal must also cease as of the 1st April.

A further requirement for the new rule will require digital links to be maintained between any accounting package or spreadsheet through to HMRC’s new filing API.

This is the first stage of the UK’s MTD initiative to digitise tax records and submissions, and MTD is likely to extend to other taxes from 2020.

Compliance with the new requirements will require fundamental changes to the existing processes and systems of many businesses. At Stafford & Co, we’ve been in the process of educating our clients about MTD for several months and working with those clients that will be affected by the 1st April deadline to ensure they will be ready.

  • Do you submit a group tax return?
  • Is your accountancy software compliant for MTD?
  • Do you submit a consolidated return for all your divisions/departments?
  • Use to submitting using Excel? Have you got the correct API in place to be able to continue to submit in this way?
The answers to these questions are key to ensuring you’re ready for MTD. Planning in advance is vital to minimise cost and ensure returns can be submitted on time.  Ask the Stafford & Co team about MTD so we can help you prepare in advance.
For more information on how we can help your business get ready for MTD, contact a member of the team on 01204 368 550 or email info@staffordandcompany.test

Lifetime Financial Responsibility – New Year

The business owners amongst us know that January means one thing – it’s tax return time!

Let’s face it, few of us relish the process of completing our annual tax return, even if you’ve got a friendly accountant to help out (did we mention that we know one or two?!)

However, if it’s got to be done, you might as well use the process as a force for good. That’s what we think anyway and that’s why we encourage our clients to take ‘tax return time’ as an opportunity not only to look back over the past year but also to look forward. This might involve making plans for the year ahead, or even further into the future.

It’s all too easy to find yourself caught up in the ‘everyday’ matters involved with running a business – from staff issues to marketing plans. Yet you probably didn’t start your business with this intention and when it comes to the time when you want to retire, you’ll be keen to reap some rewards from all your hard work!

As we’ve been discussing in some of our blogs last year, taking an interest and planning for your lifetime finances isn’t something that you can afford to leave on the side-lines. However, as the saying goes, it’s lonely at the top and for some business Directors, knowing they should be planning for their future and finding the impetus to do so are two different things.

That’s why Stafford & Co launched BoardView.  Working with owner-managed businesses throughout the year, BoardView provides companies that have a small number of Directors with the facility to hold regular board meetings to discuss strategy. In our experience, when smaller businesses start holding board meetings they immediately start thinking like, acting like and achieving like their bigger and more successful counterparts.

Whatever role you want us to play as part of BoardView, be that silent observer, finance director, independent sounding board, chairman or minute taker, we can contribute our experience to help you achieve your goals – personally and professionally.

As we provide an impartial presence at board meetings, it means we can rise above office politics and smaller day-to-day operational issues to focus on the really important matters.

Ensuring your business and personal finances are in the best possible shape is a job for now – not later. None of us know what the future has in store and it’s better to be prepared than find yourself faced with an unexpected life event and desperately trying to find a work around.

At Stafford & Co, we take it as our responsibility to prepare our clients for any eventuality. For help getting your financial future on track, contact Stafford & Co. We’re not just Accountants, we can work with you to put together a structured personal balance sheet and profit & loss to help ensure you are managing your lifetime finances and help ensure you’re fully prepared for those all-important life events – big and small.

Confused about Making Tax Digital (MTD) and the Government U-turn?

What you need to know about MTD & how to prepare your business.

Making Tax Digital reforms, which were due to come in from April 2018, have been dropped from the Government’s Finance Bill 2017.  Whilst this provides a short reprieve for SME’s, the future remains uncertain as we await the result of the next General Election to know whether MTD is likely to be raised again in the next Finance Bill.

With much speculation across businesses and the accountancy profession, Brian Palmer, tax policy expert at the AAT stated: “Whatever the outcome, I do not think for one minute that MTD will not resurface, albeit possibly in a much-altered state, enabling the UK to become one of the most digitally advanced tax administrations in the world.”

Whilst there’s no longer an imminent deadline, the drive to improve efficiency shouldn’t be due to legislation. If you need more convincing you only need to look at the fastest growing SME’s and the majority have already adopted a digital accounting process.

The changes are due to impact SMEs and self-employed individuals.  To prepare for MTD businesses need to think about how they record their financial data; namely, the accounting software they use.  MTD will be much easier to implement if you can seamlessly share real-time information with your Accountants to ensure that quarterly returns can be prepared and submitted.

Furthermore, understanding your current position at the click of a button will enable your Accounting team to help you make informed decisions about income, dividends and more, so you can minimise tax liabilities and plan effectively for your business and your future.

Having access to up to date information for both yourself and your Accountant will be imperative in making a smooth transition to MTD, but more importantly, will help you run your business better in an increasingly fast-paced business environment.

A simple easy to use and efficient cloud-based accounting software package* like Xero will ensure your business is ready for the implementation of MTD and benefit your business in the following ways:

  • Xero gives you a clear overview of your current financial position and real time data.
  • Multi-user access means it’s easy to share information with your team and your Accountant.
  • It’s easy to raise & issue invoices, match payments, automate statements, reconcile with your bank account and much more.
  • Xero connects everything together from your bank to your PayPal account and everything in-between.
  • Secure in the cloud you can access Xero at any time with a secure internet connection – perfect for getting those returns in.

Need help?

Stafford & Co are Xero gold partners, with a team of Xero certified team members; we can help you to:

  • Seamlessly transition to Xero; ensuring historical data is transferred, balances are correct and making the change easy.
  • Train Financial Controllers to use Xero effectively, minimising admin & improving reporting.
  • Provide guidance for Directors on how to use Xero to access management information and help make informed decisions.
  • Respond to any day-to-day Xero enquiries.

Find out more about switching to Xero to help improve your business, contact Stafford & Co today.

*Stafford & Co support clients across a range of cloud accountancy applications, including Xero, Quick Books, Sage One, Kashflow etc.