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Tax Deadline is Fast Approaching!
8 December 2011
Time is pressing on! The deadline for filing self assessment tax returns is fast approaching, so if you haven't already done so, then please ensure you get your paperwork to us ASAP to avoid any penalties!
Autumn Madness!
7 October 2011
The weather has turned colder and the nights are starting to draw in, and many find this a depressing time of year.
So to counteract this, we have come up with an offer that is guaranteed to put a smile on your face!
Until the end of November 2011, we are giving away £100 for each referral you put our way!*
This is a strictly time limited offer, and replaces the usual referral fee of £20 that we give you.
Why are we doing this? Well quite simply, we are in a position to take on new clients, and the best clients in our portfolio have usually come from recommendations. So to show our gratitude for the efforts you put in (and to provide you with a good incentive to try just that little bit harder!) we are offering you 5 times the usual amount that we normally pay!
Even if your referral does not require any work to be carried out just yet, providing you refer them to us by 30th November 2011 you will automatically receive your payment as and when they do require our services.
There is no limit to the amount of referrals you can give us, so get talking to your friends, colleagues, neighbours and relatives to start earning some serious money!
You can use the form found here to easily submit the details of your referral. Don't worry that it says you will only receive £20 - you will receive the full £100 providing you submit this by 30th November 2011.
*As always, T&C’s apply. The client that you refer must pay us at least £300 net of VAT (which is not a problem if they require accounts, as our minimum fee normally comes in at just over that amount). The commission to you will be paid once your referral has been invoiced for our services and has settled this invoice. The commission is only payable once per referral, on the first invoice that we raise to that person, and not on future work that we carry out, or on subsequent referrals from that client.
New CIS Penalty Regime Set to Take Effect.
29 September 2011
Changes to penalties for late construction industry scheme (CIS) returns will come into effect from 6 October. They include:
• £100 fixed fine if the return misses its due date of the 19th of each month;
• second £200 fixed penalty if a return is two months late;
• tax-geared penalty if the return is not filed six months after its due date, i.e. the greater of 5% of any deductions shown on the return or £300;
• second tax-geared fine if the return is still outstanding after 12 months. This will be the greater of 100% of any deductions or £3,000 if withholding of information was deliberate and concealed; the greater of 70% or £1,500 if it was deliberate but not concealed; and the greater of 5% or £300 for cases in which information was not withheld;
• upper limit on the amount of fixed penalties charged to new contractors that have not filed their first returns on time; and
• interest on any fine paid late.
The first return affected will be for payments made to subcontractors in the month ending 5 November, which is due on 19 November.
AGM's: Get The Details Right!
13 September 2011
Since the Companies Act 2006 came into force, there is no longer a statutory requirement to hold an AGM. But many companies still do so for reasons Jennifer Adams explains in her latest guide to company secretarial issues.
One of the more significant changes to come out of the passing of the Companies Act 2006 was that as from 1 October 2007 private limited companies are ‘no longer required to hold an AGM’.
This does not mean that AGMs are no longer held - just that there is no longer a legal requirement to do so. Many private limited companies still hold AGMs and this article details possible reasons for the meeting and the notice requirements. The section references that follow refer to the Companies Act 2006.
Why have an AGM?
AGMs must be held by private limited companies if so specified in the company’s articles or if the directors/shareholders/ members convene one.
For directors who are the only members and who see each other every day or at least are in regular contact, a formal general meeting (annual or otherwise) is potentially unnecessary as the 2006 Companies Act permits most business to be dealt with by written resolution. However, an AGM can be a rare opportunity for members who have minimal contact with directors to have their say and question directors about the company’s performance and prospects. This can be a positive PR opportunity for the company.
The Charities Commission still recommends that charities with company status hold AGMs by charities so ‘the management of the charity can be explained, that members can feel that their views are noticed'.
A company is legally required to hold a general meeting in two specific instances; namely the dismissal of either a director before the end of their term of office (s168) or similarly of an auditor (s510). This requires the passing of an ordinary resolution with special notice being given and an AGM could be used for this purpose, of course. The general meeting is to give the director or auditor the opportunity to personally state why they should not be removed. This is the only time that members actually need to be present - other resolutions can be by written resolution unless otherwise required as per the articles. Specifics of the removal of a director from office will be covered in a future article.
Notice
As an AGM is purely a general meeting that is held annually the notice period is the same. The meeting can be convened by:
Directors - giving 14 clear days’ notice or any longer period stated in the Articles (s307). Note that the “clear day” rule includes weekends and bank holidays (2006 Model Articles s41(5)). The 14 days’ notice can be reduced or even waived provided the holders of at least 90% of the voting rights agree (unless a greater percentage is required by the company articles up to a maximum of 95%). (s307(4)).
Shareholder/members - Any member who has more than 5% of the voting rights may ask the directors to convene a general meeting; to discourage members from regularly requesting these, the percentage is increased to 10% if a meeting has already been held within the past 12 months. Note: the percentage relates to the voting rights, not 5% of the number of members so a single, large shareholder could make the request. Within 21 days the directors must resolve to call the meeting and then it must actually be held within 28 days of the notice date (s304). If the directors do not convene the meeting, s305 enables the members to do so at the company’s expense.
Court - if it is not practical to convene a meeting or to conduct it as prescribed by the articles or the Companies Act, then the Court may do so, to be held and conducted as the Court instructs. (s306)
Miscellaneous
Whoever convenes the meeting must send the notice to every member, every director and anyone notified to the company as being entitled to a share on the death or bankruptcy of a member (subject to the articles) (s310).
The notice can be sent electronically to members including being posted on the company website (s308/309).
The meeting can be held using closed circuit television linking locations with a central location where the board is present (s360A). An audio or email-only link is not allowed as the members need to see and hear each other. (Byng v London Life Association (1989) 1 All ER 560)
Remember: A company must continue to hold an AGM if it specifically states in its articles that one is required and must do so until the articles are amended to remove any reference to AGMs; this can be by written resolution or at a general meeting (including an AGM). If a company has not registered its own articles and there is no specific mention - as is usual - then the 2006 Companies Act applies by default and no resolution to dispense is required.
A Very Happy Client!
9 September 2011
Yippee! Just managed to get a client over £2,600 back in overpaid tax!
Nothing like getting one over on the taxman...
New Tax Legislation Bigger Than Ever!
9 September 2011
The latest (and largest) edition of Tolley’s Yellow Tax Handbook has been published, demonstrating the on-going expansion and complexity of the UK tax code.
The 2011 edition of the handbook clocks in at 14,586 pages, nearly 10,000 pages longer than the 1997 version, which had 4,988 pages.
Referencing pioneering political economist Adam Smith, LexisNexis director of Tax and Accountancy Chris Jones said: “Adam Smith wouldn’t exactly be turning in his grave but he might well be scratching his head. One of Smith’s four principles of tax was that the taxpayer should understand what they need to pay. With more legislation, as well as revision to existing legislation, understanding the code requires the need of a professional.
“While Tolley’s provides a context within which to understand the legislation a lot of tax issues will require expert advice. According to Smith, tax should also be proportionate,” Jones continued. “Again, with a complex system it becomes harder to assess whether the tax levied is fair to those paying it.”
Jones added: “There is a cross-party consensus that the tax system should be as simple as possible but also that it needs to be fair and certain (another Smith principle). Policymakers need to decide how fair it should be and if fairness leads to greater complexity does that undermine simplicity, and perhaps eventually fairness itself. It is assumed a complex system is fairer but it is important to analyse the legislation and judge whether it delivers its intended aim.”
Who was it said that "tax doesn't have to be taxing"?
When is a Tax Scheme 'Dodgy'? When HMRC says so!
9 September 2011
They recently published a consultation document 'High Risk Tax Avoidance Schemes'. HMRC is concerned that some of their 'customers' are using
"...contrived arrangements to seek tax advantages in circumstances where they are not intended to be available, and which HMRC believes do not deliver to users the tax advantages advertised by those who promote them."
In particular, HMRC is opposed to scheme users enjoying a cashflow advantage by retaining the tax 'saved' by the avoidance scheme until HMRC has successfully challenged it through the tribunal or courts. The Government therefore wants to introduce a power to place 'high risk' avoidance schemes on a list. Under the proposals, users of listed schemes would be subject to an additional charge when the tax underpaid as a result of using the scheme was paid. Scheme users could prevent this additional charge arising by paying the disputed tax upfront.
The Government intends that only the most "contrived and aggressive schemes" would be listed, i.e. those where there is a "reasonable certainty" that they do not work.
That sounds fair enough to me. But who would be judge and jury when deciding whether a tax avoidance scheme should be listed? It would be those guardians of impartiality - HMRC!
Therein lies the problem with this proposal. There will undoubtedly be fears among many tax advisers and their clients that HMRC will adopt a scattergun approach to thwart any tax avoidance arrangements of which it disapproves.
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