PAH Accountants

HM Revenue and Customs (HMRC) are on the lookout in 2011 for small business tax under payments and tax evasion with the HMRC’s introduction of making tax compliance spot checks on small United Kingdom businesses.

These compliance spot checks are one of the last things that small UK businesses need as they try to battle the poor economic climate that exists today. What is expected is that roughly 50,000 small UK businesses will be visited, closely examined and if their books do not meet the minimum standards set then they could end up facing a fine of up to £3,000 which for many small businesses could be devastating.

The reason for the compliance spot checks is because

The objective of the Approved Mileage Allowance Payment (AMAP) scheme is to support the transport needs of business.

Employees that use their own car for business journeys can be paid the AMAP, free of tax and NIC.

The AMAP rate has been fixed at 40p per mile for what seems like forever (actually 2002!); However, the recent budget

The issue of travel and subsistence is considered to be one of the most problematic and grey areas within small business accounting, particularly for self employed individuals.

The basic reality is reasonably simple; in order to qualify for tax relief, any expenditure must be wholly and exclusively incurred for the purpose of the trade. Where an expense is incurred for a non trade or private purpose

So here we go again! You should now be receiving your notices to complete a self assessment return for the tax year to 5 April 2011.

You must ensure that this is completed by 31st January 2012 (31st Otober 2011 if completed on paper). This gives plenty of time to get it done; however, that doesn’t mean you should delay!

HMRC have amended their penalty regime, you will notice the penalty information sheet in with your tax return. The £100 penalty

The best way to the performance of your business is to use some key accounting ratios. These help you to analyse financial information about your business. Having this knowledge will aid making informed decisions about how to manage your business and help it to grow. This article highlights some of the common ratios that a business should use to measure its performance.

Profitability ratios

There are many factors to consider when looking at how profitable a business is. The profit and loss account shows

The Revenue has announced the launch of its latest campaign to identify tax fraud. They are looking to crack down on people, particularly the self employed, of fraudulently claiming tax credits. It is part on a government programme, in

Session one – the trading account

The goal of most people who set up a business is to make money. To earn a profit is to receive more money from sales than you are paying out for expenses. Profit is effectively the reward earned when taking the risk of owning a business. The Profit and Loss account is a record of the performance of a business over a specific period of time, usually annually.

The first key element of the profit and loss account is what is known as the trading account. This

Class 2 National insurance is payable by sole traders and usually a small weekly/ monthly amount.

From April 2011, the way in which Class 2 NIC is payable will be changing. It will now match the self assessment dates of 31 January and 31 July. Only two bills per year will therefore

The taxman joined twitter just before xmas and I’d encourage fellow tweeters, whether taxpayers or accountants, to follow twitter.com/hmrcgovuk (and by all means follow @TheTaxBuzz too!)

HMRC’s twitter policy statement says that if you follow this account, you can expect 1-2 tweets

Here is my video presentation of a 4sight that I did at 4Networking Taunton.

It highlights some of the issues that can arise in a small business and gives some tactics that companies can use to