Prime Entry - Making Business Sense http://www.primeentry.com fixed price accounting, tax, bookkeeping, payroll and bookeeping software Wed, 16 Apr 2014 18:28:49 +0000 en-US hourly 1 http://wordpress.org/?v=3.8.2 31st January Deadline Looms http://www.primeentry.com/news/january-2014/ http://www.primeentry.com/news/january-2014/#comments Fri, 25 Oct 2013 10:24:40 +0000 http://www.primeentry.com/?p=1293 Count down to 31st January 2014 when Tax Returns should be submitted to HMRC or face a fine…

From 1 November 2013 there are only 60 working days left!!!!…….

It’s the same every year, we write to clients all year offering a fixed fee quote to get their Tax Affairs completed in plenty of time before the deadline, we make no excuses for chasing we believe it is the right thing to do, but as always many leave it to the last minute and then wonder why they have little time to prepare for the inevitable tax bill due 31st January…

We have done well this year and although there are still a few outstanding we actually have a little bit of capacity for one or two more..

So if you know anyone struggling or if you yourself are finding the whole Tax return experience all a bit daunting, all you have to do is get in touch, we can meet up for a coffee, go through what needs to be done, offer a fixed fee quote and we promise to get your Return in by 31 January avoiding any of those horrid penalties and fines from the Revenue…

You can email me Kevin Whitehouse here

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List of Useful Grants http://www.primeentry.com/news/grants/ http://www.primeentry.com/news/grants/#comments Mon, 18 Mar 2013 14:58:28 +0000 http://www.primeentry.com/?p=1234 Here is a list of Grants availiable at March 2013.  These are changing all the time, so this list is only a guide to what is avaliable, if you would like to discuss any of these with us, or if you need help in understanding the critieriea and form filling, please just contact us:

Plymouth University
Funds to assist with business expansion
—£3.9m fund available from Round 3 of the Regional Growth Fund
—Grants between £25,000 to £150,000 to be awarded
—Covers purchase of capital assets, specialist software, premises improvement or skilled labour recruitment

—Match funded
www.plymouth.ac.uk

 

Heart of South West LEP
—£1m Rural Enterprise Grant programme
Grants over £10,000 (min)
—Cover 40% of eligible costs
—Available from DEFRA/RDPE

Centre for Process Innovation

—CPI helps companies to prove and upscale processes to manufacture new products

—Create more sustainable, efficient and economic industries
Design Leadership Programme
—National programme offering businesses  a bespoke package of support and coaching to use design to innovate and grow.
Manufacturing Advisory Service (MAS)
—A free review of manufacturing business to develop an action plan for productivity improvement
—Option to progress to specialist project to address issues and match funded support for projects
—SME’s only
 Open to Export
—Social networking Export Community
—SME support to Export and search for International referrals
—Service in partnership with UKTI
Technology Strategy Board
—Wide ranging support for innovation
—Designed to accelerate business growth
—Innovation Vouchers available
UKTI
—Passport to Export £3000 grant
—Export Market Research £5000 grant
—ERDF 33% of International Development costs up to £25,000
—Exhibition funding £1500
—Export Communications Review £250 grant
—Overseas Market Information Service 50% grant
—Gateway to Global Growth programme valued at £10,000
High Growth Coaching
—Consultant supplied at £500/day
—First 2 days free
—Further 8 days 50% match funded
Design Programme
—Support with Company literature, websites and other communication tools
—Developing new or improved products or services
—Refreshing existing brands
—Develop packaging solutions
—Design and introduce sustainable practices
Engineering Innovation Network
—2 days free business support to help grow SME in the Engineering Sector
—Includes support for new product development, IP and taking products to market
Finance for Business
—Providing risk capital for SME’s
—Run by South West Investment Group Ltd
—Not for profit organisation
—All profits used to generate economic activity and further risk investment
Improve Your Resource Efficiency
—Known as IYRE
—Free advice to businesses in Devon and Somerset
—Examination of energy costs and recommendations for cost savings
iNets South West
—Substantial grants available
—Sector focused (Aerospace/Renewables/Biomedical etc)
—High Growth Sector support
—Assistance with developing business ideas into new products and services
University Innovation Vouchers
—Funding for SME’s
—Work with University Research Establishment
—Gain new knowledge and product development
Superfast Broadband Support
—Assistance with growth businesses in Rural areas
—Support for maximising the opportunities from broadband trading

www.superfastbusiness.co.uk

Hinckley Supply Chain
—Partnership with Somerset Chamber
—Assistance to become registered as part of the supply chain for Hinckley C infrastructure development
Rural Growth Business Support
—Voucher support
—Various grants ranging between £500 to £1000
Enterprise Europe Network
—Assistance with R&D Tax credits
—Brokering joint ventures across Europe
—Financial assistance available for R&D Projects
—Contract and business networking service for sales referrals or supply chain connections
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Capture Those Receipts with Receipt Catcher http://www.primeentry.com/bookkeeping/receipt-catcher/ http://www.primeentry.com/bookkeeping/receipt-catcher/#comments Tue, 05 Mar 2013 10:26:33 +0000 http://www.primeentry.com/?p=1221 I have been looking at ways to get data into computers much faster and much more efficiently.

I have this APP on my phone called “RECEIPT CATCHER” it works really well and you can see for yourself here:

This is what people say to me:

“It’s all there, my receipts are all in the envelope, everything you need…”  Yeah right…

Whilst a load of receipts in envelope or in a file is a start, and whether you need it for bookkeeping within your own business or claiming expenses from your employer there are two important steps you need to take:


Step 1 – All those bits of paper, cheque stubs and sales invoices have to be put into some order, listed, then totalled on a computer.
Step 2 – The list then needs to be checked for accuracy:

  • To eliminate typing errors
  • Reconciled, to ensure we have all the data
  • Reviewed so it makes sense
  • Processed into accounts or tax calculations

To make it work follow these simple steps:

  • Open APP
  • Click Capture Receipt
  • Take a photo of the receipt, crop it and save it
  • Enter the category - for repeat categories it remembers them on the drop down display
  • Enter the vendor – again it builds a list for you
  • The date and value is important, but the TAX can be ignored if you are not VAT registered, but very useful if you are
  • Press Save and you are done

Now the great bit is that you don’t have to keep the bit of paper…  if you are sure you have taken a good picture and recorded the right information you are done.  So you can now keep up with your record keeping when sitting in a cafe, waiting in the car for an appointment or in the actual place you just spent your hard earned money.

RULES

As with any system you need to learn and apply a few simple rules to make sure it really works to your advantage:

  1. Make use of the EXPORT DATA menu option and at least at the end of each month export your data back to your own computer
  2. Make sure you record the data accurately at first, don’t be lazy and “short cut” the “short cut”
  3. Crop the photo
  4. Review your exported data on your own computer and save it in a folder clearly marked and make sure it is included in your back up routine – IF YOU LOSE YOUR DATA YOU RISK LOSING TAX RELIEF which is CASH
  5. Test it before throwing away all your receipts and keep the actual receipt if you want to be totally sure (HMRC, just want proof, this can be a photo of a receipt)

With data captured you can now create a CSV file, this can be now read by other software without the need to re-key the data and takes you one step closer to reducing the risk of error and making life just a little bit easier for you.

There are other useful APPs and tools out there, the key is to “DO SOMETHING” and get all those bits of paper into a computer in the fastest most efficient way possible.

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Can I claim the cost of my home against tax? http://www.primeentry.com/bookkeeping/use-of-home/ http://www.primeentry.com/bookkeeping/use-of-home/#comments Thu, 14 Feb 2013 12:25:27 +0000 http://www.primeentry.com/?p=1213 You work from home; can you get any tax relief?  The simple answer is YES.

The Inland Revenue will accept a reasonable estimate if it is for minor use such as writing up the business records at home.  However, if you are using your home every day and have a dedicated room, give some thought to how you can justify the true cost, document your calculations and make sure you have discussed this with our accounts team to ensure you have maximised your claim.

Here are some examples…

(These examples have been extracted from the Inland Revenue website February 2012)

Example 1

Angela writes up her business records at home. She uses a room solely for business use for a short period each week.   It would be reasonable to say the cost of the proportion of the establishment costs, plus the electricity for heating and lighting, could be in the region of £2 a week.

Example 2

Bill runs a small business. He uses one small room at home as an office, exclusively for the purposes of his trade.  The room represents 5% of the floor area of the house.

His Council Tax, insurance and mortgage interest bills total £4500.  He claims 5%, £225.

His electricity bill for heating & lighting is £300. He claims £15, which is 5% of the total.

His total claim is £240 (plus the business proportion of his phone bill).

Example 3

Bert runs a small business. He uses the spare bedroom at home as his office except for a week at Easter and a week at Christmas.  All he does is to write up his records, once a week.

The house has 10 rooms.  Bert calculates that his business expense, based on 1/10 of the total costs would be £450.  Bert recognises that this is far too much for what he actually does at home.

Bert estimates that £104 covers the cost of the proportion of the establishment costs, plus the electricity for heating and lighting.

Although the claim for £104 is obviously an estimate of £2 per week, the claim is small and reflects the facts of the case.  It is a reasonable estimate of the expense incurred.

Example 4

Chris is an author working from home.  She uses her living room from 8am to 12am.  During the evening, from 6pm until 10pm it is used by her family.  The room used represents 10% of the area of the house.

The fixed costs including cleaning, insurance, Council Tax and mortgage interest, etc total £6600.  A tenth of the fixed establishment costs is £660.  For the purposes of fixed costs, one sixth (4/24) of the use by time is for business, so Chris claims £110.

She uses electricity for heating, lighting and to power her computer, which costs £1500 per annum.  Chris considers an apportionment of these costs by time and area.  A tenth of the costs are £150 and half of these costs by time (4/8) relate to business use, she claims £75.

She also uses the telephone to connect to the internet for research purposes.  Her itemised telephone bill shows that a third of the calls made are business calls.  She can claim the cost of those calls plus a third of the standing charge.

Example 5

The facts are as in example 4.

Chris has some work done on the house.  She has the exterior painted and at the same time has the dining room re-decorated.

What, if anything, can she claim as a deduction?

The exterior painting is a general household cost.  She can claim a proportion based on business use.

Chris does not use her dining room for business purposes.  The cost of redecorating the dining room is not an allowable expense.

Example 6

Gordon, an architect, dedicates a room solely for use as his office between 9am and 5pm daily.  The room contains a workstation, office furniture and storage for his drawings.  He uses the room for an average of 4 hours each day, though often this is spread over his working 8 hour day as he has a number of regular site visits to make.  In addition it is not uncommon for Gordon to accommodate clients in his office to discuss plans, outside of normal hours.

The room is available for domestic use outside of business hours and his family regularly make use of the room for around 2 hours each evening.

After apportioning costs by reference to the number of rooms in the house, Gordon calculates the room uses £300 of variable costs (electric and oil) and £600 of fixed costs (council tax, mortgage interest, insurance).  In apportioning these costs by time Gordon claims £680 in total, made up of 4/6 of variable costs (£200) and 8/10 of fixed costs (£480).

The claim equates to 75% of the total costs attributable to the room (£680/£900), which Gordon views as a more straightforward but equally reasonable basis for future claims, should his circumstances remain unchanged.

Example 7

Bill entertains a number of customers at his home.  Each time he hires caterers and also a firm of cleaners.

Although Bill has used his home for business purposes, he cannot claim any of the costs as there is legislation that disallows entertaining costs.

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Late VAT Returns – Should you Worry? http://www.primeentry.com/bookkeeping/late-vat-returns/ http://www.primeentry.com/bookkeeping/late-vat-returns/#comments Tue, 05 Feb 2013 11:48:30 +0000 http://www.primeentry.com/?p=1204 In the latest round of Inland Revenue targeted initiatives, they are heading out to deal with business owners who are late submitting their VAT Returns.

If you are VAT registered you must take care to ensure your VAT Returns are submitted on time.  The Inland Revenue web site for online filing is simple to use and available 24 hours a day.

The key to being able to get your VAT Return completed is good bookkeeping.  If your books are kept constantly up to date, running the VAT return is just a matter of reporting.

If you have any worries on this matter or know a friend who is struggling to keep up with their paper work and VAT Returns, please forward this email to them and ask them to call us.

The Inland Revenue tells us that as many as 50,000 businesses have failed to submit VAT returns on time and these will be targeted by HM Revenue and Customs this month with warnings that their tax affairs will be closely scrutinised.

More than 600,000 businesses have to put in VAT returns each month and most do so on time.  But in a new campaign some 50,000 will be warned that, from 28 February 2013, their tax affairs will attract greater attention.

The VAT Outstanding Returns campaign is aimed at businesses that have one or more VAT return outstanding, and have been told to submit their returns but have not done so.  Some will have received an assessment of VAT for these periods.

These businesses are being given an opportunity to get up to date and pay the tax they owe by 28 February.  After that, HMRC will target them and take a much closer look at their tax affairs.  By using this campaign to come forward voluntarily, they might receive better terms, as any penalty they pay may be lower than if HMRC comes to them first.

Marian Wilson, Head of HMRC Campaigns, said:

“After 28 February, if they have not submitted their outstanding VAT returns and paid what they owe, HMRC will use its legal powers to pursue outstanding returns and any VAT that is unpaid.  Penalties, or even criminal investigation, could follow.“

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The late-night bookkeeping club – are you a member? http://www.primeentry.com/bookkeeping/late-night-bookkeeping-club/ http://www.primeentry.com/bookkeeping/late-night-bookkeeping-club/#comments Mon, 28 Jan 2013 10:38:40 +0000 http://www.primeentry.com/wordpress/?p=135 Everyone in business, no matter how big or how small, has to keep some form of bookkeeping. The problem is, it’s like the washing up – it’s never finished!

I wonder how many people sit at a desk or kitchen table late into the night writing up the books, probably for the whole quarter, just because the VAT return is due? I wonder how many business owners dread the thought of bookkeeping?

Are you or do you know someone who is a member of “the late-night bookkeeping club“?

The problem

It’s been a busy week running the business. Perhaps there are feelings of being under pressure. Everyone is fed up with the weather, and moaning about the recession. Suddenly there’s the realisation that the VAT return is not due next week, but this week! The only time left to do it is in the next few evenings.

The rush

So, the records have been gathered together, along with bills, invoices, bank statements, and cheque stubs, and they are whisked home and set up in the “home office”. Sitting on the sofa, a glass of wine in one hand, the TV remote in the other, the task is started. You’re convinced that “this is what true business people do” and “it’s great that I can work and interact with the family at the same time.”

The result

Aside from the whole family being fed up with having no quality time, and the fact that it will take at least three times longer to get the work done late at night, because you are tired, and the home office sometimes just doesn’t function as well as it should, the real problem is that of errors and poor bookkeeping.

A VAT inspection

I was speaking with a VAT inspector recently while he was conducting a routine visit on one of our clients. He was explaining how the VAT and HM Revenue and Customs inspectors are all now working together, and that many of the limits for genuine errors and mistakes have been raised, taking away some of the red tape in dealing with relatively small errors.

He then went on to say that where he finds a business with good quality bookkeeping, his confidence level is lifted, and it enables him to complete his review more efficiently and leave the premises within just a few hours. However, his duty, should the record keeping be poor, was to dig deeper until he was satisfied that what was being declared was accurate. Simply put, he said that poor bookkeeping gives HM Revenue and Customs even greater reason to look much more closely at the business owners, with obvious links to not just VAT, but PAYE, income, and the corporation tax departments.

“We don’t want problems, we want solutions…”

At Prime Entry we have several solutions on offer:

  • Use our bookkeeping bureau service, offering fixed-price bookkeeping
  • Try our easy-to-use bookkeeping software, with full support and training available
  • Speak to us, and see if we can help to train you to improve the use of your existing systems
  • Improve your time management – maybe help is needed to identify a strategic business plan
  • Perhaps you need some help just getting life organised and gain some better focus. If you play sport, you need coaching, so why not invest in a coach for your business and life in general?

So the message is…

If you are in business, or know someone who is, remember that bookkeeping is very important, and that the penalties for getting it wrong are about to get tougher.

At Prime Entry we specialise in bookkeeping, so why not call us to see if we can work with you, or if you know someone who you think may need our help, please feel free to recommend them to us.

For more information, contact us.

Kind regards,

Kevin Whitehouse
01747 826989
kevin@primeentry.com

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Tax Return Deadline 31st January – What’s the fuss all about? http://www.primeentry.com/accounting_tax/tax-return-deadline/ http://www.primeentry.com/accounting_tax/tax-return-deadline/#comments Mon, 14 Jan 2013 19:54:52 +0000 http://www.primeentry.com/?p=1193 It is often part of human nature to leave the things we don’t like doing until the last possible moment in time.  I suspect if you travel around any town or business park over the weekend or late in the evening through January, you will see many accounting firms with their lights on and a team of people working overtime to get the last of the Tax Returns completed and submitted by 31st January deadline.

At Prime Entry we are always relaxed at this time of year, of course we still have a few Tax Returns to process, but we are certainly not under any pressure.  We make no excuses for chasing our clients throughout the year to avoid this mad panic season.

If you know anyone who is struggling with their Tax Affairs, please send them along to speak to us, we will do our very best to help them get up to date.

So what is the fuss, what happens if your Tax Return is late?

HMRC issue penalties for late submission of Tax Returns:

Delay Penalty you will have to pay
1 day late A penalty of £100. This applies even if you have no tax to pay or have paid the tax you owe.
3 months late £10 for each following day – up to a 90 day maximum of £900. This is as well as the fixed penalty above.
6 months late £300 or 5% of the tax due, whichever is the higher. This is as well as the penalties above.
12 months late £300 or 5% of the tax due, whichever is the higher.  In serious cases you may be asked to pay up to 100% of the tax due instead.  These are as well as the penalties above.

Example

Mrs A’s tax return is due on 31 January 2013 but HMRC doesn’t receive it until 5 August 2013.

It is over six months late so she will have to pay ALL of the following:

  • ·       £100 fixed penalty
  • ·       £900 penalty – this is £10 each day from 1 May to 29 July, when the maximum 90 day penalty is reached.
  • ·      £300 or 5 per cent of the tax due – whichever is the higher
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All attitudes are contagious, is yours worth catching? http://www.primeentry.com/coaching/contagious-attitudes/ http://www.primeentry.com/coaching/contagious-attitudes/#comments Wed, 09 Jan 2013 10:15:31 +0000 http://www.primeentry.com/?p=1183 I believe there are basically three generic areas in life that we all focus on, Relationships, Health and Money.  However, a vital ingredient to the success of any of these three areas in our lives is in our own self-development.
Having a great attitude is something we must all learn to adopt as we go about our daily lives.  At Prime Entry we have a large shiny dustbin by the front door, to dump our problems before we start work.  It is there as a symbol to us all in the office that we must work as a team and adopt a great attitude towards are fellow colleagues and it also reminds the employee and employer to work on a good, no make that, a great attitude towards each other.

It is absolutely okay to have struggles, to have challenges in life, we all have them at work, home, with children and parents, family and neighbours.  It is equally important to recognise what the challenge is, but I believe it is not acceptable to spend the day walking around moaning a complaining and generally having a stinky attitude towards everyone around you just because you are having a bad day.  There is always a solution.
So for us at Prime Entry, we have the opportunity to lift the lid on the bin and dump our bad attitude, metaphorically speaking in the bin.
How do you deal with your “stinky attitude”?

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RTI – Real Time Infomation a brief overview http://www.primeentry.com/news/rti-a-brief-overview/ http://www.primeentry.com/news/rti-a-brief-overview/#comments Tue, 20 Nov 2012 10:50:29 +0000 http://www.primeentry.com/?p=1160 The biggest change to the Inland Revenue PAYE system in 60 years…

Below are the answers to a few basic and common questions about the new Real Time Infomation scheme.  The Inland Revenue have issued Employers Bulletin no 42 which is a useful guide to further your reading, Click here to read it.

What changes will be made to the operation of PAYE using RTI?

Q: Will I be able to send PAYE pay and tax details in real time using PAYE Online (the ‘Portal’)?

A: No.  Instead, you will need to use either payroll software or, if you have nine or fewer employees, HMRC’s Basic PAYE Tools, to send this information in electronic reports called Full Payment Submissions (FPS) directly to HMRC.

Q: What changes will be made to PAYE Online (the ‘Portal’) with the introduction of reporting in real time?

A: HMRC has set these out in their guide ‘An overview of changes to PAYE Online when you start reporting in real time’ – see the link below.

An overview of changes to PAYE Online when you start reporting in real time

How will RTI operate?

Q: Will forms P35, P14 and P38A be needed using RTI?

A: No – end of year returns (forms P35 and P14) or P38A supplementary return will not be needed as employers will tell HMRC about all payments made during the tax year each time their payroll is run.

Q: Why does an FPS include the hours worked?

A: The hours worked is required for the purposes of calculating Tax Credit payments.

Q: We have two ‘pay runs’ per month which are expense reimbursement. How can we identify that these payments are totally non-taxable and not liable to NIC?

A: You do not need to report these expenses payments using RTI if they are ‘totally non-taxable and not liable to NICs’.

Q: How soon after the Employer Alignment Submission (EAS) will the employer be permitted to send in their first RTI submission?

A: Once the EAS has been successfully submitted the employer is considered to have joined RTI and they can start sending FPSs immediately. But wait 30 minutes in between submitting the EAS and the first FPS so that the FPS does not ‘overtake’ the EAS during processing.

Q: How will HMRC treat statutory payments shown on an Employer Payment Submission (EPS)?

A: If you have claimed an advance of statutory payments then the amount you report on an EPS will be set off against the PAYE due as reported on an FPS.  If a credit remains this will be set-off against any advance you have claimed, and any remaining credit will be used against any other amount due, or if nothing is due you can contact HMRC and claim a repayment or reallocation.

Q: I pay my employees monthly, which is when they receive their payslips.  However, I also make ‘interim’ payments mid-month, when I pay my employees a proportion of the net pay they would otherwise receive at the end of the month. Do I need to send an FPS for these interim payments?

A: Under the regulations, whenever a payment of PAYE employment income is made, PAYE should be operated.

When submitting payroll information in real time, you should send an FPS at the same time as you operate PAYE.

HMRC appreciate that the timing of the requirement to send a FPS may cause issues where occasional ad hoc payments are made to individual employees and the payroll would not normally be run at that time.

HMRC will look at this issue as part of our review of the requirement to send the FPS ‘on or before’ the time of payment.

Q: Will I have to make an RTI submission even if I haven’t paid anyone?

A: If you are registered with HMRC as an employer who pays HMRC quarterly, HMRC will know to expect quarterly payments from you without you needing to do anything further.

All employers need to send an FPS every time they pay their employees, whether they pay HMRC monthly or quarterly.  If you haven’t made any payments to any employees in a tax month, you should send HMRC an EPS showing ‘No payment due as no employees or subcontractors paid in this pay period’ within 14 days following the end of the tax month.  This also applies to employers who pay HMRC on a quarterly basis – if you do not, then HMRC will specify an amount due for that month, and pursue this at the end of the relevant quarter.

Q: I have about 15 newspaper boys/girls who are all under 16 and are paid between £10-£15 a week. Must I include them in the payroll for RTI and include them in an FPS etc?

A: No. Employees under 16 do not need to be included in an FPS etc, unless their earnings exceed the income tax personal allowance.  When an employee reaches 16, read the HMRC guide ‘Employee reaches 16′. However if you already include employees under 16 on your payroll and you would find it easier to include them in the FPS with the rest of your employees then you may do so.

Employee reaches 16

Q: Can I advise HMRC that I am not going to have any employees for a specified period?

A: Yes. You can submit one EPS to advise HMRC of your ‘period of inactivity’. HMRC will not expect any other return, nor any payment, for the period(s) reported.

Q: Is an employer required to submit RTI returns if they do not currently have a PAYE scheme to submit PAYE returns and do not have any employees earning above the LEL?

A: The operation of PAYE remains the same under RTI.  So if an employer is not required by law to complete a ‘deductions working sheet’ for any employee, the employer will not be required to operate PAYE, so not subject to RTI, or have a PAYE scheme.

Where an employee earns less than the LEL and their income is not required to be reported under PAYE, the individual will be expected to inform DWP of their earnings. As part of Universal Credit, DWP will have alternative processes to collect information about income that is not reported through RTI.

If an employer is operating PAYE then using RTI they will have to tell us about payments of earnings to all employees, even where an employee earns less than the LEL. This is a change from now, where employers do not have to maintain a P11 if someone earns, for example, £20 a month.

Reporting details of employees earning below LEL is required to:

  • support Universal Credit which will be based on household income
  • help ensure people are paying the right amount of tax on their income

Where an employee earns less than the LEL and the income is not required to be reported under PAYE, the individual will be expected to inform DWP of their earnings. As part of Universal Credit, DWP will have alternative processes to collect information about income that is not reported through RTI.

Q: How will the system cope with an employee who resigns and is rehired in the same month with two corresponding payslips (two separate contracts)?

A: The system will count the two employments as separate by operating on the information submitted by the employer. The last payment from the first employment should have a date of leaving. The first payment from the new employment should include the starting information including start date and should not take into account pay and tax information from the previous contract when calculating the year to date figures. If the employer is using payroll ids they must ensure the second contract is set up using a different payroll id.

Q: What would happen if an individual had five positions with the same organisation (for example, a local authority) and ceases four but keeps one of these positions? How should this be reported?

A: Assuming that the five positions are treated as separate employments and tax and National Insurance are calculated separately for each employment, as each finishes a leaving date should be sent as part of the relevant FPS. HMRC will, if necessary, issue a code each time.

If the earnings from all five jobs are accumulated and tax and National Insurance are calculated as one employment (ie there is one tax code in operation) no additional action needs to be taken until the last employment ceases.

Q: Reporting in a previous year – due to the limitations of HMRC systems, HMRC will run the end-of-year reporting for 2012-13 at the end of March 2013. HMRC will then need to send EAS and the first FPS to move into RTI also at the end of March for the first payments for the 2013-14 tax year. As you will receive feeds for the following tax year early, will this be a problem?

A: HMRC are currently looking into what they can do for April 2013 to allow RTI submissions to be made in advance of the year to which they relate. HMRC will provide an update once they have looked into this further.

Q: Reclaiming tax in previous tax years – can you clarify the use of Earlier Year Updates (EYUs) against the FPS for a previous tax year? What would you expect for reclaims greater than two years? For six years following implementation will we still need to do P14 submittals for the non-RTI years which can be claimed on?

A: The EYU is needed to correct details of previous RTI years – you will only be able to use it for the tax years where you were required to operate PAYE using RTI. An FPS can only be sent up until 19 April following the end of a tax year – after this any corrections need to be made on an EYU.

Non-RTI years will still be corrected via amended P35/P14s as per the existing PAYE arrangement.

Q: Reclaiming overpayment of tax – will we still need to do adjustments for previous years at the end of each tax year or can this be done throughout the year? Each time we do a mini adjustment to the client how are we reclaiming the tax?

A: Adjustments can be made throughout the year with the final FPS showing the correct Year To Date (YTD) figures. If adjustments relate to previous RTI tax years then the EYU is needed to show the correct details.

Q: I have claimed ‘CIS deductions suffered’ on my EPS: can I have a refund of any excess?

A: Yes you can have a refund at the year end, and if there are no outstanding debts.

Q: Date of leaving: What date should be entered on the FPS?

A: The date to enter is the date the employment ended. The exact date of this is for the employer to decide.

What will not change using RTI?

Q: What will not change using RTI?

A: The following will remain unchanged:

  • PAYE – PAYE remains the same using RTI.  It is only the reporting that changes.
  • Coding notices – using RTI employers will still be able to choose how they receive coding notices; as they do now.
  • Reporting a change to HMRC e.g. updating employee’s new name or addresses for HMRC records – an RTI submission will not update HMRC records. It remains is the responsibility of the individual employee to notify HMRC of changes of name, address, etc.
  • HMRC messages to employers using RTI – HMRC will continue to use the Data Provisioning Service (DPS) and EDI outbound message services.
  • Payment dates using RTI – payment dates to HMRC will remain the same using RTI.
  • Forms P60 – P60s will remain using RTI.
  • Forms P11 – HMRC are not planning to change the requirement to complete a deductions working sheet (or electronic equivalent).

Q: Will RTI change the Construction Industry Scheme (CIS) payment and reporting process?

A: RTI is not changing the existing CIS process. Employers will continue to complete and file monthly returns due under the existing CIS arrangements.

Q: Will RTI be able to handle Tax Free Pay?

A: Yes

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Employing Staff who have Smelly Feet http://www.primeentry.com/coaching/staff-with-smelly-feet/ http://www.primeentry.com/coaching/staff-with-smelly-feet/#comments Mon, 05 Nov 2012 16:06:57 +0000 http://www.primeentry.com/?p=1143 I met up recently with Malcolm Scott-Walby of Scott Walby solicitors based in Poole, Dorset.

Scott Walby LLP Tel: 01202 311 112

I’ve met Malcolm on a number of networking events over the years.  I find Malcolm’s approach to be very inspiring and we got to talking about staff and sub-contractors contracts of employment.  Something I have to pay attention to employing my own staff.

There is often a fear expressed to me by clients of employing people, some say:

“they don’t do what you ask of them, they have a stinking attitude, turn up late, go early and cost you endless hastle and additional costs like pensions, sick pay etc etc…”

This may be true for many business owners, but often forgetting one thing.  It is about attitude and expectations.  If the staff and the employer both have a good attitude and know exactly what to expect of each other, then surely you have cracked most of the issues and for many who adopt the process you get happy efficient staff.

As an example, Malcolm sent me this case summary.

In Ranson v Customer Systems plc, the Court of Appeal has held that an employee who met his employer’s clients with a view to securing work for his own company after his resignation was not in breach of contract.  There was no fiduciary duty on him to report such meetings or his intention to set up in competition and there was nothing requiring this in the employee’s contract.

The Court of Appeal held that it was dangerous to reason by analogy from cases about directors to cases about employees as this was liable to lead to confusion.

That brilliant employment lawyer, Judge Elias held that there was no general principle that an employee must inform his employer if and when he is doing outside work in breach of his contract.  Any such obligation can only arise from the terms of the contract.

Conclusion:  Your employment contracts are your single primary opportunity to protect your rights as an employer.  You can use it to impose good faith clauses, post-employment restrictions and the right to deduct loans or overpayments from employees.  You can protect databases of clients, confidential information, software theft and even impose the right for employees to wash their uniforms, hide their tattoos and wash their smelly feet, if you can justify these rights.  Why wouldn’t you protect the goodwill of your greatest asset?

For more information on this or any other legal matter, why not contact Malcolm direct

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