Chancellor, George Osborne began his third Budget speech
with a pledge to support working families, through “far
reaching reform” of the UK tax system.
The IHT threshold is frozen at £325,000 until 5th April 2015.
A reduced rate of 36% will apply from April 2012 to death estates, where 10% or more of the net estate is left to charity.
The chancellor’s statement contained some key announcements on personal and business taxation, including confirmation of a cut in the 50p headline rate of income tax.
Business Tax
Corporation Tax
Highlights were as follows:-
First £ 300,000
Next £1,200,000
Over £1,500,000
Income Tax Rates
2012/13
Tax Rate
Basic rate band – income up to
Higher rate – income over
Additional rate – income over
£34,370
£34,370
£150,000
20%
40%
50%
Personal Allowances
Personal Allowances – under 65
– 65 to 74
- 75 and over
2012/13
£ 8,105
£10,500
£ 10,660
2012/13
Taxable profits
20%
25%
24%
The main rate of corporation tax will be reduced to 23% for
the financial year commencing 1st April 2013 and to 22% from
1st April 2014.
Capital Allowances
From April 2012 there will be a reduction in the amount of
expenditure on plant and machinery that qualifies for a 100%
Annual Investment Allowance from £100,000 to £25,000.
The Personal Allowance for those aged under 65 increases
from 6th April 2012 to £8,105. The advantage to higher rate
payers is countered by a lowering of the higher rate threshold,
to £34,370 from 6th April 2012.
In addition, the rate of writing down allowance will be reduced from 20% to 18% (main rate pool) and from 10% to
8% (special rate pool).
Furnished Holiday Lettings (FHLS)
Small Business
From April 2012, the following tests must be satisfied in order
for a letting to qualify as an FHL.
The property must be available for commercial letting
as holiday accommodation for a minimum of 210 days
during the relevant year.
From April 2013 a new cash basis for calculating tax for small
unincorporated businesses will be introduced. The Government will consult on the details of the scheme, including on
extending eligibility to businesses with turnovers up to the
VAT registration threshold of £77,000.
The property must actually be let to the public for a
minimum of 105 days during the relevant period.
VAT
The accommodation must not be let for periods of
longer term occupation (over 31 days) for more than
155 days in the tax year.
Capital Taxes
Capital Gains Tax
The annual exempt amount for 2012/13 is £10,600
Inheritance Tax
Approved alterations to listed buildings, effective 1st October
2012.
Currently these are zero rated, but new rules will result in all
building materials and construction services supplied in the
course of an approved alteration to a protected building becoming subject to VAT at the standard rate.
For further advice or clarification on any of the above please
contact your respective director/manager.
“Charities don’t pay tax” is a
frequently heard remark. The statement is true
up to a point. There are significant tax exemptions
from income and capital gains tax for charities, but these are
not automatic, blanket exemptions.
Is it time
for a spring
clean?
Do you use sage accounting
software? Or to put it
Gift Aid is the main way that the UK tax system tries to encourage giving to
another way do you input
charities. Gift Aid is a real positive for charities as it is worth an additional 25% for
information into Sage just to
each gift that falls within the definition of a qualifying donation.
produce your VAT return and
provide your accountant with
There are a number of danger areas for charities when Family
claiming Businesses
gift aid to watch out for.
information that they use to prepare
your year end figure?
Is it know
really that
a gift?
If thebusinesses
donor expects
to receive a benefit in return or that the
Did you
family
represent:
If you fall into that category then
sum maybe repayable then it is not a gift.
with a few alterations you could get
3million firms in the UK and two out of three in the private sector
so much more from Sage.
Has a “Gift Aid Declaration” been completed by the donor and in an
There are some very useful features
acceptable
9.2 million
jobsformat?
and two out of three in the private sector
around credit control that are not
fully utilised. Sending statements and
Memberships.
A payment
membership
be considered
a gift
if there
A combined
turnover
of £1.1 for
trillion,
almost can
a quarter
of the as
UK’s
GDP.
letters to collect money has been part
are not significant benefits given to the donor. An example of a benefit could be
of the Sage software for a very long
sports
coaching.
What
are the
key issues involved in running a family business?
time but few of us actually use it. The
latest versions also have a feature
When making the claim it is important the audit trail is right. It is very
Communication
that manages credit control. This
important
that good records is
are
kept. for running any business, but especially, family
Good communication
essential
Both familythat
recordsbusinesses.
all the communications
and non-family members should feel that they have the opportunity to put across
theirsent
views.
have been
to a Personal
customer isand has
The UK tax system
also assists
charities by
generally
exempting
fundraising
events from
sues should
be removed
from
business
discussions
by operating
as a commercial
enterprise.
a feature
that allows phone calls to
both Income Tax and VAT. This general exemption though does not extend to any trading
be recorded and reminders to be set.
activities
carried out.
Charities often have a cafe or hire out facilities to provide
Managing
Conflict
Do you print out a profit and loss acadditional funds.
These
of trading
activities
andemotional
not fund raising.
The One of the count?
There
mayare
be examples
clashes with
commercial
and
concerns.
best ways
to avoid conflict
Is it meaningful
to yourisbusito prevent
misunderstandings
happening
inand
theVAT
firston
place,
communication.
Non-execcharity may therefore
have
to pay Corporationfrom
Tax on
their profits
their hence better
ness?
This can be tailored
to suit your
utivesignificant
directors trading
can play
a vital role here.
business and provide more detail.
sales if they have
activities.
Sage has a large amount of
Planning
HM Succession
Revenue and Customs
have also been taking a more active look at the charities’
standard reports but there will
Ashave
the heading
suggests
forward
is essential
should be started as
earlybe
asone
possible.
involves
always
report It
that
Trustees. They
introduced
a “fit and
proper”planning
test to make
it harderand
for sham
identifying
the successor
and of
the
planning
release
control.
This active
process canwould
involve
some
help
yourextremely
business ifhard
it was
charities to be
set up. In Scotland
the Office
the
Scottish to
Charity
Regulator
is also
questions.
altered.
With
Sage
report
in this area. If a Trustee is appointed who is not considered a fit and proper person then
designer it is
the charity could lose its exemption status and its registration with OSCR. It is therefore
There are other issues e.g. Managing Change, Employment of Family Members and Pay Structures, often
whichpossible
will beto
important that proper procedures are in place to appoint and vet potential trustees.
addressed in our next issue, but should you require any guidance or assistance, please contact us. amend a report
or add in new
The UK tax system can be made to work very effectively for a charity and its donors.
information.
However if the rules are not followed the consequences can be significant. If you would
If you would like
like help to make sure your charity is set up the best way then get in touch with us.
any further
information then
For further information and advice, please contact Philip Bald at our Abercorn office.
do not hesitate
to contact us.
Family Businesses
Did you know that family businesses represent:
3 million firms in the UK and two out of three in the private sector
9.2 million jobs and two out of three in the private sector
A combined turnover of £1.1 trillion, almost a quarter of the UK’s GDP.
What are the key issues involved in running a family business?
Communication
Good communication is essential for running any business, but
especially, family businesses. Both family and non-family members
should feel that they have the opportunity to put across their views.
Personal issues should be removed from business discussions by
operating as a commercial enterprise.
Managing Conflict
There may be clashes with commercial and emotional concerns.
One of the best ways to avoid conflict is to prevent misunderstandings
from happening in the first place, hence better communication.
Non-executive directors can play a vital role here.
Succession Planning
As the heading suggests forward planning is essential and should be
started as early as possible. It involves identifying the successor and the
planning to release control. This process can involve some extremely
hard questions.
There are other issues e.g. Managing Change, Employment of Family Members
and Pay Structures, which will be addressed in our next issue, but should you
require any guidance or assistance, please contact us.
A9 Support for
Queensferry B.I.D.
A9 are delighted to support, Queenferry’s BID, proposals, in advance of the
vote in May 2012.
A BID (Business Improvement District) is a defined area within which businesses
(non domestic ratepayers) pay a levy in order to fund improvements within the
defined area and thereby enhance their trading environment.
Further to the raising of funds from taxpayers, the BID is also able to access
substantial funding from local government and other agencies. It is an
investment scheme where local businesses have the opportunity to influence
how the funds should be invested for the benefit of the area and their
employees, customers and clients.
Queensferry has a large number of local businesses with a sprinkling of
nationals such as Tesco and Scotmid. With the investment that can be made in
Queensferry, there is most certainly potential benefits to all businesses in the
area, not least from the large number of cruise liners which arrive each year,
but also making Queensferry a desirable place to both live and work in.
This will then increase both the potential and quality of the workforce and
make Queensferry a destination not to miss.
For further information, www.queensferryambition.co.uk
This year’s
exhibition is being
held on Friday 15th June 2012 at
Falkirk Town Hall, where A9 will be
one of over 50 exhibitors.
For further information go to
www.falkirkbusinessexhibition.co.uk.
ClientNews
Congratulations to our Lerwick client,
Shetland Shellfish Management Organisation, who
recently received the world’s first Marine Stewardship
Council (MSC) accreditation for king scallops, and the UK’s
first for brown and velvet crabs.
to Lerwick staff member,
Ann Johnson on the birth
of her daughter, Tina Irene,
on 2nd March, 2012.
IT’S A GIR
L
A9 pedal for
Parkinson’s nurses!
Abercorn client, Lauren Ferguson,
owner of Sisters Boutique in Falkirk, has
had her business voted as one of the UK’s
Top 100 Inspiring Independents by
Drapers Magazine. This is a huge
accolade for the business and one which
Lauren is very proud of. The shop was
voted for by brands and prominent
business people in the trade, not by the
public and confirms the business as
inspiring and waving the flag for
Independent Fashion businesses.
www.sistersboutique.co.uk
!
This year we have decided to put a number of
our staff members through their paces by entering the Stirling Pedal for Parkinson’s 20 mile cycle
on the 5th August. Parkinson’s is a progressive
neurological condition, which there is no cure for
at present. The nurses provide valuable help in
supporting people coming to terms with their
Parkinson's diagnosis as well as many other
aspects of the condition. So if you feel inclined to
support a very good cause please donate by
going to www.justgiving.com/A9Partnership.
Your support is greatly appreciated.
LIST OF OFFICES
THE A9 PARTNERSHIP LIMITED
ABERCORN
Abercorn School, Newton
West Lothian EH52 6PZ
Telephone (01506) 834700
Fax
(01506) 834710
e-mail [email protected]
LERWICK
47 Commercial Road, Lerwick,
Shetland ZE1 ONJ
Telephone (01595) 696424
(01595) 694296
Fax
e-mail [email protected]
DUNBLANE
57/59 High Street, Dunblane FK15 OEE
Telephone (01786) 822066
Fax
(01786) 825563
e-mail [email protected]
EDINBURGH
Thain House, 226 Queensferry Road,
Edinburgh EH4 2BP
Telephone (0131) 332 9128
Fax
(0131) 343 1061
e-mail [email protected]
THE A9 PARTNERSHIP (ABERDEEN) LIMITED
TRADING AS BOWER + SMITH
ABERDEEN
The A9 Partnership (Aberdeen) Ltd
trading as Bower + Smith
6 Rubislaw Place, Aberdeen, AB10 1XN
Telephone (01224) 638844
Fax
(01224) 647803
e-mail [email protected]
BookChoice
Playing to Win by Karren Brady
Enlightening book, which encouraged and
empowered. There are great stories of success from
a diverse mix of women as well as Karren Brady.
It was an easy read and caused you to pause for
thought on your own goals and provided insight
to help you achieve them.
Very inspiring which made you feel you’re not
alone in your quest for success.
LAURENCEKIRK
75 High Street, Laurencekirk AB30 1BH
Telephone (01561) 377586
Fax
(01561) 378027
e-mail [email protected]
INVERNESS
THE A9 PARTNERSHIP (HIGHLAND) LIMITED
Elm House, Cradlehall Business Park,
Inverness IV2 5GH
Telephone 01463 791000
Fax
01463 791001
e-mail [email protected]
WEB SITE
www.a9partnership.co.uk
FINANCIAL HEALTH WARNING The technical terms included in ‘The Account’ are not meant to be a complete guide to the subject discussed. We recommend that
you contact us for full details on any topic in respect of which you require information and for advice as to the relevance of these topics to your own
personal circumstances. Accordingly, we cannot be held responsible for persons acting or failing to act as a consequence of information contained in ‘The Account’.
barkerdesignandillustration•falkirk Please contact [email protected]
Congratulations