November 2011 EZine

Welcome to the November edition. Now that winter is finally upon us and people are gearing up for the festive period, your finances may be at the forefront of your mind. This month we've got information on pensions, the latest tax crackdown and your opportunity to find out how to grow your business. I hope you find it helpful!

Paul Carvell
Stewart, Fletcher & Barrett

Vince Cable Fined By HMRC

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Do You Need The Info2Grow?

Helping local businesses gain access to vital information is the plan behind 'Info2Grow', a new initiative from Stewart Fletcher & Barrett, Lloyds TSB Commercial and Nuneaton-based solicitors Tustain Jones, in association with Nuneaton & Bedworth Borough Council. The event is also being supported by the Chamber of Commerce and the Federation of Small Businesses.

The aim of Info2Grow is to provide invaluable advice for businesses who are looking to progress to the next stage in their development, but who are encountering some barriers to achieving the growth they hoped for. Topics covered will include finance, employment, marketing and risk management (amongst many others), and there will be an extensive Q&A session where attendees can quiz the advisers about specific problems they may be facing. The event will be held at The Chase, Higham Lane, Nuneaton on November 10th, and will run from 4.30pm until 7pm.  

SF&B senior partner Paul Carvell explained: "This event presents a unique opportunity to directly access advice from a cross-section of business experts on how you can take your business to the next level. We hope that this initiative will prove to be the kick-start that many local businesses need to take their operations to the next level."

As well as Paul Carvell, advisers will include Alan Ison (Lloyds TSB Commercial), Adrian Young (Federation of Small Businesses), Jo Darling (HR - Stewart, Fletcher & Barrett Group) and Peter Tustain (Tustain Jones Solicitors), and experts in areas such as wealth management and business start-ups will also be in attendance.

Alan Ison commented: "At Lloyds TSB Commercial, we are proud of our record in helping businesses cope in a tough economic climate, and I believe an event like Info2Grow will provide a valuable resource for the local business community."

Anybody interested in coming along can fill in the online form at www.sfb.uk.com, or email tracy.johnson@sfb.uk.com.

Employees Need Pensions Advice

Recent research has found that most employees want to be able to access advice on pensions at work. The survey of 1,400 adults showed that a whopping 80% of workers would welcome such guidance in the workplace - but only 17% said they would like to receive advice from their employer. The majority (55%) would prefer to speak to an independent financial adviser (IFA) about their plans, while just 9% wanted to receive advice from the Government. The same research also revealed that nearly half of adults had no pension fund at all.

These findings come ahead of the Pensions Act 2012, which comes into force from October next year. The Act will oblige employers to enrol all eligible staff (earning more than the minimum threshold, currently £7,475, and aged between 22 and the current state pension age of 65) automatically into a pension scheme and contribute towards their retirement. Employees will have to actively opt out if they decide they do not wish to save into a workplace arrangement.

Martin Lindsey, Director of Stewart, Fletcher & Barrett Wealth Management, explains: "These changes have been introduced by the Government in an attempt to tackle the predicted pensions crisis, which is the expected result of an ageing population with insufficient retirement savings. This is an issue that certainly needs to be addressed. People must be properly informed and advised, and the sooner the better.

"Being a good employer means taking into account the wants and needs of your workforce. Providing practical advice and help in certain areas can greatly aid staff retention and morale, as well as enhancing your reputation as a firm."

For independent advice on pensions, contact us now on 02476 384171.

Loni's Sage Tip

Use the Customer Sales summary to find out who your most profitable customers are.

Taxman's Tough Lesson For Tutors

Private tutors and coaches are the latest to learn that they will be targeted over any unpaid tax. HM Revenue & Customs has been contacting colleges for information about private tutors as part of its latest crackdown on tax evaders, and began sending out letters as early as 11 July this year. Colleges that fail to comply with the demands in time will be subject to a £300 fine and a further daily fine.

Paul Carvell, Senior Partner at Stewart, Fletcher & Barrett, explains: "The new Tax Catch-up Plan (TCP) will give tutors until 31 March 2012 to report any outstanding tax liabilities - but they should be aware that HMRC is using 'various intelligence sources' to identify and then target those who do not take advantage of this opportunity to declare their full income.

"The crackdown on private tutors is only the latest sector-specific campaign from the taxman, but the way it is being conducted is noticeably different. The two most recent campaigns - plumbers and tutors - are examples of HMRC pro-actively seeking out information, rather than responding to information that happened to fall into their hands.

"In the case of plumbers, it looked into Gas Safe registered plumbers; for tutors (as revealed by Accountancy Age) it is issuing Section 16 notices - but now HMRC is not even working in partnership with the professional bodies. By issuing the notices, it is placing an extra burden on colleges - how much time will have to be spent on compiling and sending the required information? It seems that the taxman is less inclined to give people plenty of time to take advantage of amnesties, and is now more focused on going straight for the jugular."

If you are concerned about an HMRC investigation, contact us now to find out how we can help on 02476 384171.

Tax Mistake Hits Pensioners

HM Revenue & Customs will shortly be writing to 146,000 pensioners who owe tax for the 2010/2011 tax year - because of an error they made. Some pensioners' tax codes were not adjusted to take account of their state pension, and the resulting underpayment letters are due to be sent out at the end of October. 

A spokesperson for HMRC said:  "Where a pensioner has underpaid tax for 2010-11, we will automatically code out that underpayment over a period of three years from April 2012 without them needing to contact us. We will also write to these customers to apologise, explain why the underpayment happened and how we will collect it."

In the past, some pensioners who had a tax underpayment because of state pension errors have had their tax written off. HMRC announced last year that it wouldn't pursue underpaid tax from before 6 April 2010 because those taxpayers were likely to have a successful claim under Extra Statutory Concession A19 (ESC A19). This can be used by people to claim that their tax should be written off in cases where HMRC had the correct information about their tax affairs but failed to act on it, and where the taxpayer can show that it was reasonable to assume that their tax affairs were correct. 

But ESC A19 cannot usually be claimed where the arrears are less than a year old, which means that this option is unavailable to the thousands of pensioners affected this year. 

Sasha Wickham, Tax Manager at Stewart, Fletcher & Barrett, comments: "HMRC usually adjusts your tax code so that it can collect underpayments over the course of one year. Undoubtedly, the fact that instead they will spread these underpayments over three years is good news, as it lessens the impact on pensioners' purse strings, but it will still come as an unwelcome surprise for many, who will have to adjust to a lower income each month."

For help and advice on pensions, give us a call now on 02476 384171.

SF&B Halloween Fun

Staff at Stewart, Fletcher & Barrett donned their most ghoulish garments to raise money for charity yesterday. Each staff member donated £2 for the option to dress up, and cakes were also available to buy. A total of £84 was raised for Children In Need.

Time To Pay - Update

HM Revenue & Customs' Time to Pay (TTP) scheme is under scrutiny once again. This time, it has emerged that the taxman has been agreeing multi-million pound TTP arrangements without requiring businesses to undertake independent reviews to check their viability.

Earlier this month, HM Revenue & Customs released its figures on TTP arrangements, and an analysis of the data by industry publication Accountancy Age showed that 140 high-value arrangements (over £100,000 a year) worth L45m were made in June, at an average of £321,000 each. This compares with an average of around £180,000 to £200,000 in each of the previous 15 months.

HM Revenue & Customs has stated that a small number of very high-value arrangements made in June skewed the figures and, if it were not for these, the average would be similar to other months. Research showed that these arrangements would have to be collectively worth around £17m to skew the June average figures to this extent.

Back in 2009, Alistair Darling announced in the Pre-Budget Report that HMRC would require businesses applying for TTP for debts of £1m or over to provide an independent business review (IBR) supporting their request. This involves the businesses appointing insolvency practitioners to review their long-term viability - but a freedom of information request has shown that no IBRs were carried out in June, and only six had been carried out in total between January 2010 and June 2011.

Senior Partner Paul Carvell comments: "HMRC has claimed that an IBR is not always required in £1m+ cases, because each TTP request is considered on its own individual merits and circumstances. However, in light of the taxman's recent reluctance to agree TTP arrangements with so many struggling businesses, this seems rather an odd situation. It would appear that, for a few large-scale enterprises with outstanding tax liabilities, HMRC is prepared to be more lenient. When you contrast this with the declining number of TTP arrangements made for smaller sums, one has to wonder whether it's one rule for bigger companies and another for SMEs."

 

Stewart, Fletcher & Barrett
www.sfb.uk.com