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Quarterly snapshot for business owners who want to be in the know June 2018
Are you an Amazon or a Vodafone?
Anyone else have a love/hate relationship with Amazon or is it just me? …. I love how easy they make it to spend money with them. I also hate how easy they make it to spend money with them …. I recently read The Everything Store by Brad Stone which tells the story of Jeff Bezos and Amazon and it made me realise that although he must be a very difficult man to work for he really has put the customer wants and needs at the heart of everything they do. And I see this in the way so many of us, including me are addicted customers.
TI Accountancy: Tip The Wink - June 2018
They take away all friction in the sales process. The 1-click service means that wherever you are and whatever you are doing you can simply get your phone out your pocket and buy just about anything you need without even having to get your bank card out. Also if you subscribe to Prime, that product you just bought with 1-click is going to be delivered within 24 hours too – how many other companies can compete with this? When purchasing audible books, they have made this process so easy too. Your membership fee gives you 1 credit to a book www.tiaccountancy.co.uk
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R&D Tax Relief could you be eligible?
Are you an Amazon or a Vodafone? every month. The membership is £7.99 a month and most audible books are in the price range of £15 to £25 each, making you feel like by being a member you are getting something back. If you consume more than your one book a month you have the option to purchase 3 more credits (note not one at a time) for £18. The great thing is that you aren’t worried about the £18 purchase because your credits stay on your account until you use them. And when you decide to leave any of Amazon’s membership products, you can .. just like that! Now if we compare this to how Vodafone treat their customers to try and make them stay you see a huge difference. Vodafone make you pay for your 4G bundle but it disappears at the end of every month if you don’t use it, they tie you in to a contract for years after knowing your phone is bound to be out of date and to leave you have to use a cracked phone screen for a year or take out a mortgage to buy an off the shelf one.
Some companies are good at getting rid of buyer friction for customers, others aren’t!
In your business what ways can you lessen buyer friction? Do you make it easy for customers to join and leave you? Do you have bundles that are “no brainers” that they can use to their convenience and not yours? Are you an Amazon or a Vodafone .. I’d know which I’d rather to aspire to.
Tracy x
They are a wonderfully friendly team, that are knowledgeable and reliable in making it much easier for me to concentrate on growing my business”. John Lamerton, Owner, Big Idea Mentoring Ltd
TI Accountancy: Tip The Wink - June 2018
Within the accepted HMRC research and development definition, R&D doesn’t have to have been successful to qualify.
Naked Wines are another good example of taking away buyer friction as, although they ask you to pay a certain amount per month on membership to get wine delivered, you have no obligation to have any deliveries on a monthly basis and they even give you the option to get your money refunded if you so choose (although who would want their money back when you can have great wine?!?)
By TI Accountancy working closely with the directors of our company it really is like having our own financial director in the business who can help us identify opportunities and pushes us on growth.
www.bigidea.co.uk/opcc
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Types of R&D tax relief There are different types of R&D tax relief depending on the size of your company. Most companies fall into the small and medium sized enterprises: • less than 500 staff • turnover of under €100m or a balance sheet total under €86m.
R&D tax reliefs support companies that work on innovative projects in science and technology. What counts as R&D? To qualify for R&D the work you are carrying out must be part of a specific project to make an advance in science or technology (social sciences like economics and theoretical fields like pure maths are not included). This could be either by creating new products/processes/services or by changing or modifying existing products/processes/services. The project must relate to your company’s trade – either an existing one, or one that you intend to start up based on the results of the R&D. To get R&D tax relief you need to explain how a project: • looked for an advance in science and technology • had to overcome uncertainty • tried to overcome this uncertainty • couldn’t be easily worked out by a professional in the field.
SME R&D relief allows companies to: • deduct an extra 130% of their qualifying costs from their yearly profit, as well as the normal 100% deduction, to make a total 230% deduction (so an extra 33p for every pound spent on R&D). • claim a tax credit (cash benefit) if the company is loss making, worth up to 14.5% of the surrenderable loss. What R&D costs can you claim? The following types of expenses can all qualify for R&D expenditure: • Employee salaries, employers NIC and pension contributions • Subcontractors/freelancers • Materials and consumables including heat, light and power • Certain types of software If you believe you could be carrying out work that would qualify for R&D tax relief or would like any further clarification please do not hesitate to contact us.
Lucy www.tiaccountancy.co.uk
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A Company Profile
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Jennifer Hamley
2017 saw them having over 10 styles on offer!
What is your business? In 2015 one of Jennifer Hamley’s earliest handbags won an International design award. Jennifer Hamley England had to move pretty quick to keep up with the demand. Selling Handbags and Accessories that combine Luxury with Organisation they have been able to design more bags and expand the product range.
Due to the nature of the business Jen and her husband Ben (who also works in the business) worked from Bali for 10 months last year as they love to travel. This year they are house-sitting their way across the UK while they work. Growing Jennifer Hamley England has been a whirl wind and the biggest challenge facing the 38 year old designer when trying to keep up with demand was funding, however, Jen is a problem solver and says “It's amazing what is possible when you have a deadline!”.
The things that keeps Jen motivated in the business are satisfied customers and creating new bags! She loves hearing from people who love their bags. Although over the growth of the business Jen has seen her customers becoming more conscious about where their money goes and thinks responsibility and honest communication will be a big part of future success. She also concentrates on where her own money is spent and thinks if the government lowered Business rates for independent retailers this would allow them to compete in the high street. Jen would like to see her bags stocked in the most
TI Accountancy: Tip The Wink - June 2018
beautiful shops all over the world! She wants people to love her products and to create a community of women that support one another to be their very best. She also aims to fund humanitarian charities, particularly supporting the empowerment of women from all walks of life. How has TI Accountancy Helped? TI Accountancy helped give Jennifer Hamley England Organisation and accountability! Jen says she is so happy to have a team that I can rely on to help me with an aspect of business that is quite frankly not her forte!
www.tiaccountancy.co.uk
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Health and Safety liability Manual Handling
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Is the Pension Regulator coming after you... If you are one of the thousands of companies that had been predicted not to have implemented your Auto Enrolment scheme then don’t worry, we can get you compliant. We can suggest a range of schemes that are perfect for small businesses and I think you’d be pleasantly surprised at how little the employer pension contribution will be.
Employers’ Liability and Health and Safety I have mentioned in previous blogs that the majority of businesses who have employees are legally required to have Employers’ Liability insurance. Should an employee become injured or ill due to the work they carry out for you, they can claim compensation from you. This is why it is important to follow health and safety legislation. And it doesn’t have to be difficult. There are consultants and businesses who are able to advise and guide you through HSE legislation to make this easier for you. One company we work with for Health and Safety is James Woolgrove Associates who offered this advice around Manual Handling issues:By getting help to change the way you work, you can reduce manual handling risks. The HSE have recently confirmed what I have said for a long time. New guidance on the HSE web site states “Research has shown that general training in lifting techniques is an ineffective way of controlling the risks of manual handling in businesses.”
Rather than just getting off the shelf training to lift a cardboard box we need to look at the task that is being undertaken. I was once asked to train people in manual handling to lift a heavy object and carry it over a fence and into a building. My advice put in a gate and use a trolley- the major hazard had been removed and the process simplified. The Health & Safety Executive quote on their website:As long as you have taken reasonable steps to prevent accidents or harm to your employees (and the injury or illness was caused after 1 October 2013), you shouldn’t have to pay compensation. However, if a court finds you are liable, employers’ liability insurance will help you to pay any compensation for your employees’ injuries or illness. http://www.hse.gov.uk/toolbox/managing/ insurance.htm If you require any assistance with Employers’ Liability Insurance or Health & Safety issues, please do not hesitate to contact me.
Sarah TI Accountancy: Tip The Wink - June 2018
If you would like to see how little a month it would be for us to take care of your payroll and auto enrolment responsibilities, then please feel free to download our price guide from payroll services page. With all businesses now reaching their auto enrolment staging date The Pension Regulator is using its powers to establish employers have fulfilled their Auto Enrolment duties. The watchdog issued 11,156 fixed penalty notices between January and March 2018 – up from 7,435 in the previous quarter which shows how serious they are in enforcing everyones compliance.
Kelly
Puzzle
A fixed penalty notice of £400 is issued to an employer for failure to comply with a statutory notice or some clear-cut employer responsibilities to perform. The Pension Regulator also issued 2,700 escalating penalty notices – which vary between £50 and £10,000 per DAY depending on the size of the organization. These are issued to the employer if the company still hasn’t complied. It is vital that employers understand that The Pension Regulator is willing to take action against those who neglect to pay the pension contributions their staff are entitled to, and they are making it obvious that they are fully prepared to use their powers to get employers to be compliant.
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