Tag: #team4

Why Is It Important To Thank Clients And Staff At Christmas?


How do you thank clients and staff at Christmas? If you are in quandary as to whether it’s all worth it, our latest article should help. It’s certainly not long to go, but there is still time to send clients and your team a Christmas message or gift. It’s a great time to thank customers and remind them of your brand. Your team has also been working really hard throughout the year, so it’s the perfect time to reward them with something special, so they feel appreciated. In the latest article from team4, bookkeepers based in East Sussex with worldwide clients, we look at why you should thank clients and staff at Christmas, the things you can do, what defines a business gift according to HMRC and whether these things are tax and VAT deductible.

 

Why should you thank clients at Christmas?

 

• Creates a positive association with your brand
• Increases customer loyalty
• Helps to build better relationships
• Leaves a special and lasting impression
• Promotes good will
• Keeps your brand in customer’s minds
• Highlights your appreciation and gratitude
• Gives an opportunity for an extra promotion
• Provides a way of reconnecting with clients

Why should you thank staff at Christmas?

 

• Appreciation of their hard work throughout the year
• Boosts morale for the coming year
• Promotes employee loyalty
• Acts as a reminder of the positive environment they are working in
• Makes employees feel valued
• Improves productivity
• Emphasises they are part of a warm and caring team
• Increases results and motivation

 

How to thank clients and staff at Christmas

 

• Send a thank you message in the form of a Christmas card
• Send a gift for Christmas – thoughtful branded gift
• Take them out for a festive lunch
• Invite them to a special event
• Post about them on social media

 

For customers, you could implement a loyalty programme, possibly discounts on repeat subscriptions, and rewards that accumulate with the more they purchase.

Thanking your team

 

When considering your team, you could give recognition awards, personal gifts and post Christmas incentives. Upgrading their workspace goes down well which could include an ergonomic office chair or an upgraded room for breaks. And don’t forget to get the office into the festive mood with decorations including a tree and Santa hats.

 

What is a ‘business gift’?

 

‘A business gift is a gift of goods that is made in the course of promoting your business and for which you were entitled to reclaim the VAT you were charged on its purchase as input tax. By ‘gift’ we mean a definite, voluntary and unconditional transfer of the goods for no consideration.’

 

If you do want to thank clients and staff at Christmas in this way, it’s probably fair to say that in general business gifts are not tax-deductible as the vast majority fall under the category of entertaining. However, there are exceptions and the specialist bookkeepers at team4 will be able to help you.

 

Tax and VAT implications

 

1. If the total cost, including VAT is less than £50 per employee, tax relief is available for the cost of businessesproviding company gifts to employees. The VAT can also be reclaimed on the cost of the gift. There are exceptions and the gift must not be cash or a cash voucher, cannot be linked to the employee’s performance, or provided as part of a salary sacrifice scheme. Gifts over £50 are treated as a ‘benefit in kin’ and are therefore taxable to the employer and employee.

 

2. Annual office events such as Christmas parties are also allowable for both corporation tax and VAT relief. The so-called ‘annual event’ allowance allows you to spend up to £150 per head on a tax-free event or series of events. However there are a number of points your should be aware of:

 

• The event must recur annually
• Must be available to all employees generally
• The £150 per head ‘exemption’ is inclusive of VAT, as well as any transport to and from the event, or accommodation for attendees
• If the cost of the event is greater than the £150 exemption, then the whole amount and not just the excess may result in a benefit in kind to the employee

 

3. Business gifts allowable for tax purposes to customers or clients fall into two categories:

• Giveaways to the public (like a free sample) to advertise your business
• Gifts less than £50 that advertise your business, not including food, drink or tobacco

 

Vouchers are allowable in this instance, so long as they are not exchangeable for cash. Multiple gifts to the same person amounting to more than £50 are subject to tax.

How can team4 help?

 

We hope team4 has demonstrated how important it is for you to thank clients and staff at Christmas and at othertimes of the year. It demonstrates to clients that you appreciate their continued business and to staff that you recognise their loyalty, hard work and professionalism. Customer retention and satisfaction are the key ingredients to a successful business. By thanking them you are showing that you recognise their invaluable contribution and you are also saying thank you for their ongoing support. If you are confused as to what constitutes a business gift and whether it is tax deductible, please get in touch with team4. You don’t want to be making any costly mistakes. Call us on +44 1825 763378 or +44 1903 442511 or email info@team4bookkeeping.co.uk

How To Reduce The Running Costs Of Your Business

Making savings to reduce the running costs of your business could be ‘make or break’. Figures suggest that the number of companies going bust this year could be the highest since the financial crisis of 2009. Statistics also show that insolvencies rose 10% from a year ago in the three months to the end of September and there has also been a sharp increase in the number of firms at risk of going bust. Before your company falls into this category, it’s worth considering how you can save monies. In this latest article from team4 bookkeepers, based in Sussex with worldwide clients, we look at eight things you can do that could dramatically reduce your overheads.

 

  1. Explore alternative business premises

 

Could there be an alternative to the long-term commitment of renting office space? If you are not fully utilising all the space you have at your disposal, you might consider downsizing. You may not need that large office anymore as you are now outsourcing your marketing and bookkeeping, so maybe a space half that size would suffice. Perhaps a co-working arrangement might work for you or could employees work from home? In the latter scenario, you could save rental fees and the associated costs of a physical building, saving you a packet.

 

  1. Check regular outgoing payments

 

Do you know what you are paying for every month? And if so, do you need everything that is going out of your business? To reduce the running costs of your business, it’s time to pull the plug on unused services. These could include subscriptions or networking fees or software apps that are never used. You can check with your team to see if services are still necessary. With software, consider downgrading to a free version. It really is easy to lose track of payments particularly if made by recurring payments such as on your credit card or direct debits. Here at team4, we think you will be surprised about what you are paying for that you don’t need.

 

  1. Are you getting the best energy tariff?

 

If you are not tied into a contract, find out if you can get a better deal. It’s worth checking a few companies to see the best contract terms available. On top of this, you may be able to make savings on the energy you use to reduce the running costs of your business. Turning the thermostat down by a degree or two can save a lot and your office does not need to be heated when you are not using it.

 

  1. Could you get a better deal on your mobile telephone and Internet?

 

When your mobile and Internet services are due for renewal, check out other deals, as there are some really good ones out there. Some suppliers have deals on the number of phones that you use. We recommend that you don’t automatically renew services including mobile phones, business insurance and broadband contracts. Renegotiate every year to make sure you are getting the best price.

 

  1. Shop around for the best price on supplies

 

You could be making savings on software and general office stationery. Buying in bulk can be a good option if you know you will use/sell the stock. You may find that there are some good deals around traditional sale times including Black Friday later this month (24 November) and Cyber Monday (27 November). Also be on the look out after Boxing Day and New Year.

 

  1. Go paperless to save oodles on printing costs

 

To reduce the running costs of your business, consider moving completely away from any paper documentation and go completely digital. Going paperless can really save you money and so encourage your team to only print out documents only when essential.

  1. Draw up a budget and stick with it

 

This will help to identify areas where you can make savings. Your budget can be based on your average income per month and our tip is underestimate income and overestimate spending. This is applicable irrespective of the size of your business, from start-ups to growing businesses.

 

  1. Get the best professional advice

 

Make sure you are getting the best advice from your bookkeeper and/or accountant. Tax relief is available for small to medium sized businesses. And don’t miss out on tax-deductible expenses across a wide range of categories including office supplies, uniforms and vehicle fuel.

How can team4 help you to reduce the running costs of your business?

 

In these tough times, we hope you have found our latest article about how to reduce the running costs of your business helpful so that you can lower some of the expenses and overheads associated with running your business. Here at team4 our aim is to support you by optimising your expenses, keeping close tabs on your spending and helping you set budgets. If you are looking to work with a bookkeeping team with a proactive approach and your interests at heart, please get in touch. We can help you with ways to improve your cash flow and ways to get your clients to pay on time. Call us on +44 1825 763378 or +44 1903 442511 or email info@team4bookkeeping.co.uk

How To Avoid Payroll Mistakes

Payroll management is a vital and fundamental element of running a business and it is paramount that you avoid making payroll mistakes. It is important that payroll processing is carried out accurately and is compliant. You will want your employees to be paid correctly and on time and you will also want to avoid any fines or legal issues. There are lots of hurdles to jump over including complex legislation, auto-enrolment, rolling deadlines and RTI submissions. With large fines for mistakes, it’s worth getting the process right. Here at team4, bookkeepers with worldwide clients, we often witness payroll errors when we are called in to put things right. Here is our list of the most frequent payroll mistakes and our tips on avoiding them.

Misclassifying workers

This involves misclassifying the status of somebody doing work for you. It is one of the most common payroll mistakes. It often involves not distinguishing between an employee and a self-employed contractor. There are many distinctions you will have to make including new starters, those with a second income and employees with company benefits such as a vehicle or private medical insurance. Contractors and freelancers are not eligible for the same rights as employees such as holiday allowances and pensions. Your workers’ status should be based on HMRC guidelines and employment law. Here at team4, we advise efficient record keeping and keeping up-to-date with the latest legislation.

 

Application of incorrect tax codes

If employees are given the wrong classification, this can lead to over or under taxing them. Tax codes should be reviewed regularly and it is important to do this if an employee’s circumstances change. Tax codes can be checked with HMRC and therefore you are expected to assign the correct tax code to each employee. You can review and download tax codes by signing up for the HMRC PAYE dashboard.

Not implementing an Auto-Enrolment pension scheme

Auto-enrolment in workplace pensions is now a legal requirement. You will need to contribute to your employees’ pensions and of course comply with the regulations and rules. Fines can be imposed if you fail to comply, so make sure you implement a robust pension scheme. There are frequent changes in thresholds and regulations so it is vital to regularly review publications from The Pensions Regulator to avoid payroll mistakes.

Missing deadlines

There are strict deadlines for payroll submissions. This includes Real-Time Information reporting and payment of taxes. To avoid penalties, we recommend careful planning and keeping meticulous and correct records.

Inaccurate record keeping

Records of employees pay must be kept accurately and large fines are applicable for failure to do so. As an employer you must maintain records of hours worked, bonuses, overtime and deductions. According to the government you must collect and keep records of:

 

  • What you pay your employees and the deductions you make
  • Reports made to HMRC
  • Payments made to HMRC
  • Employee leave and sickness absences
  • Tax code notices
  • Taxable expenses or benefits
  • Payment Giving Scheme documents including agency contract and employee authorisation forms

 

How to prevent payroll mistakes

 

  • Keep accurate and up-to-date employee records
  • Schedule payments on time
  • Track employee leave and absences
  • Keep abreast of tax regulations
  • Use reliable and the right payroll software for your business
  • Outsource your payroll

 

How can team4 help you to avoid payroll mistakes?

Without the right tools, resources and knowledge, employee payroll can be a minefield. We hope our latest blog has highlighted the most common payroll errors and will help you to avoid them. Careful planning, accurate record keeping and staying up-to-date with the latest legislation are your three keys to success. However, if you really want to avoid these payroll mistakes, the answer is to outsource your payroll to an experienced and knowledgeable team. For more information on how we can help, please get in touch. We have experts in this field to ensure you are always compliant and your employees are paid on time. Call us on +44 1825 763378 or +44 1903 442511 or email info@team4bookkeeping.co.uk

How Much Should You Spend On Your Marketing Budget?

In a competitive and ever changing business world, marketing can make or break a company, but how much should you spend on your marketing budget? There is certainly no one-size-fits-all answer to that question. In this article, team4 looks at what a marketing budget involves, the criteria you should use to establish how much you spend and what is considered an allowable marketing expense.

What Is a Marketing Budget?

“A marketing budget is an outline of the costs that a company will spend to market its product or service. The marketing budget covers a finite period of time, the length of which can be anywhere between a quarter to a year.”

ProjectManager

It will need to include what your marketing goals are and how much you intend to spend. Marketing in itself encompasses a vast array of activities such as paid advertising, your marketing team or consultants, social media spending, leaflets and flyers and of course your website. It often helps if you can include a degree of flexibility.

Criteria for deciding how much to spend on your marketing budget

  • Size and type
  • Goals – establish short and long term goals including Key Performance Indicators (KPIs)
  • How established – new up and coming or older and more established
  • Understand your target audience – location, age, income, education, job titles etc.
  • Comprehend your market and competition – demographics, customers, influencing factors etc.
  • Optimal channels for reaching your audience

Opportunity Marketing suggests that between 5-15% of revenue is the acknowledged rule of thumb. However, your marketing budget should be set following a thorough analysis of your business, including the criteria we have outlined above.

What can you claim for marketing your business?

According to the UK Government website, you can claim allowable business expenses for:

  • Advertising in newspapers or directories
  • Bulk mail advertising (mailshots)
  • Free samples
  • Website costs

However, you cannot claim for entertaining clients, suppliers and customers and event hospitality.

When it comes to Subscriptions, you can claim for:

  • Trade or professional journals
  • Trade body or professional organisation membership if related to your business

You cannot claim for payments to political parties, gym membership fees or donations to charity, although you may be able to claim for sponsorship payments.

Controlling your marketing budget

Do your research to help you decide on the most effective marketing channels for your business. These could include video, blogging, social media, online advertising, events and/or print advertising. Once you have decided, and this may change, allocate the financial spend for each channel. You can then work out how much revenue and profit you should generate and how that will impact on your cash flow.

Choose the right accounting software for your business

Your marketing spend can then be tracked by your accounting software to give you a detailed breakdown of your marketing spending. This will also give you the data required in order to track performance over time, so you remain in complete control of the money you are spending. By understanding this, you can make more informed decisions in the future. You will know where you are spending the money, which channel brings the best ROI and of course how much you have spent. If you are unsure which accounting software would best suit your business, ask your bookkeeper or accountant.

How can team4 help you with your marketing budget and allowable expenses?

The latest blog from team4 did not set out to tell you how to market your business. However, it is clear to achieve success, your business must stand out from the crowd. In this way, you will grab the attention of your potential customers and clients. Without effective marketing, your business may struggle to compete in the market and reach your objectives. Your business is unique, which should be reflected in your marketing activities and budgeting strategy. Some of your marketing will fall into allowable expenses and if you want to understand more about your marketing spending and your ROI, we are happy to help. And of course, if you need to outsource your accounts, including setting up cost codes in your accounts software, please get in touch with team4 by calling us on +44(0)1825 763378 or email info@team4bookkeeping.co.uk to find out more.

Five Reasons To Outsource Your Accounting Operations

Why is it important to outsource your accounting operations? Every business irrespective of size needs to keep accurate and up-to-date records of every financial transaction. This includes sales, purchases, payments and receipts. Outsourced accounting is becoming more popular as it helps to reduce business overheads and you won’t need a dedicated office space. In team4’s latest article we look at five of the benefits of outsourcing your accounting operations by having a professional accounts department.

Reasons to outsource to a professional accounts department

  1. Expertise
  2. Better use of your time
  3. Reduced costs
  4. Scalable and flexible options
  5. Peace of mind

What is outsourcing?

“Outsourcing is the business practice of hiring a party outside a company to perform services or create goods that were traditionally performed in-house by the company’s own employees and staff. Outsourcing is a practice usually undertaken by companies as a cost-cutting measure. As such, it can affect a wide range of jobs, ranging from customer support to manufacturing to the back office.”

Investopedia

  1. Expertise – make more effective decisions by knowing the financial situation of your company

It makes a lot of sense to outsource your accounting operations. Trained professionals will have the expertise and will understand how to apply the best practices to your business. You will know the current state of your company in real time. By knowing the margins on every client or job, keeping a healthy cash flow and knowing the productivity of your team, you will have an insight into what drives your bottom line results leading you to make more effective decisions. You will also remain compliant with current legislation, which is apt to change frequently. Buying or renting accounting software will become a thing of the past. Your expert outsourced accounting department will use the software best suited to your business.

  1. Spend time running your company – not doing the books

As your business grows, bookkeeping and accounting tasks will grow too. You may initially have been able to cope with these yourself, but not anymore. It’s far better to free up your valuable time, and let’s face it, time is the most precious resource you have, by doing something more productive and what you do best, running your company. You can spend your time developing and growing your business to increase revenue knowing you have a professional outsourced accounts department to take care of the additional financial implications. So, don’t let bookkeeping and accounting distract you from operational tasks.

  1. Reduced costs – save on payroll and productivity costs

Why not pay for the actual accounting itself? When you outsource your accounting operations, you won’t need to employ a member of staff on a full-time or part-time basis. You will save in payroll and productivity costs. You can determine the number of hours required each week and this way you are not employing someone and paying them for hours that are not required. The money savings can be quite considerable.

  1. Scale up or down depending on requirements

When you outsource your accounting operations, it will give you lots of flexibility. You will be able to scale up or down based on your requirements. This could range from a few hours to few days a week. You will have the flexibility to bring in the help and expertise you need during a time of growth. And you won’t be adding to your payroll. And if times become challenging, you may find you can ride out the storm by reducing your accounting costs and using their expert knowledge. You can also get the latest developments and technology without having to invest in it.

  1. Peace of mind

Ultimately, this is what you are looking for. By turning your bookkeeping and accounts over to experts will ensure you have confidence and trust in the accuracy and quality of the financial information of your company.

How can team4 help you to outsource your accounting operations?

Outsourcing your accounting operations will give you a cost-effective, affordable, efficient and valuable alternative to functions that have been carried out in-house. You will not only benefit from the cost and time savings but also have the peace of mind that your books and accounts are being looked after professionally so that you can focus on your business. Outsourcing can be a very effective solution when trying to survive in tough times although we know that outsourced bookkeeping and accounting is not the best solution for everyone. Bookkeepers know bookkeeping and by using team4, you will have a team of experts at your disposal. Call us on +44(0)1825 763378 or email info@team4bookkeeping.co.uk to find out more.

You Are The Business As A Sole Trader

If you are starting a new business, do you want to set up as a sole trader? It’s certainly an exciting time as you think of what to call your company, how to brand the business and get noticed by those all-important customers. There is certainly a lot to do, but part of the process is picking the right structure for your new company. You will want to adhere to all the legal requirements and to also stay tax compliant. Whether you set up as a sole trader or a limited company is an important consideration. If you are not sure whether you should register as a sole trader, our latest blog explains what it entails, the benefits of being a sole trader, as well as the disadvantages and how team4 can help you.

What does being sole trader entail?

 A sole trader is a self-employed person who owns and runs their own business as an individual. The simplest way to run your business is to register as a sole trader. By doing this, you do not have to pay any registration fees, but you must register as self employed. You will need to inform HMRC and you will then pay tax through Self Assessment. This means filing a tax return every year. It’s at this point you will have to decide if you are going to do the accounts yourself or whether you need a bookkeeper to do them for you. By going down the route of being a sole trader, you get to keep all the profits you make. Sounds good? However, you are also personally liable for any debts that your company incurs. This could be a risky way to do things if your new business needs a lot of investment. In short, if your company runs into financial trouble, creditors can come after your house and possessions.

Benefits of being a Sole Trader

  • No requirement to register with Companies House
  • Can start working straightaway
  • Complete control with no shareholders or directors
  • No Corporation Tax or Accounts to Companies House
  • Easier to set up than a Limited Company
  • Simple to switch to being a Limited Company in the future
  • Financial information is kept private
  • You are your own boss – you are the business

You will need to register within three months of starting up your business and then submit an annual Self Assessment form and pay Class 2 NICs.

Disadvantages of setting up as a sole trader

  • Unlimited liability – you are personally responsible for any debts and losses of the business, including outstanding tax, rent etc.
  • Less credibility – not as appealing as a limited company to customers, so check how your competitors have set up their businesses
  • More difficulty in getting financing
  • Full responsibility – you are accountable for everything and make all the decisions

How can team4 help you as a sole trader?

You will have to maintain accurate accounting records as a sole trader that follow standard accounting practice. These will have to include records of your sales and expenses. You’ll actually find that these are invaluable when completing your annual self assessment tax return. Here at team4, we can help you decide whether this is the most flexible and cost-effective route you should take and also advise you when it’s time to set up as a limited company. The most important thing for us is that the operating structure you decide to implement is the most beneficial one for you and your business. We pride ourselves in helping self-employed people to not only set up their businesses but to also grow them as well. Please get in touch with us so you can decide if starting out as a sole trader is right for you. Call team4 on 01825 763378 or email info@team4bookkeeping.co.uk

Next time we will be looking at Limited Companies in more detail, so stay tuned.