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Giving you the heads up.... Monthly Newsletter of TI Payroll & Accounting

May 2014 Edition 27

Welcome to May’s Newsletter Last week I went to Penrith to watch Trisha Stewart speak. For those who cannot recognise her from the photo Trisha is the lady who Helen Mirren's character was based on in Calendars Girls. I took my Mum knowing how much she loved the film and thought it would b e a g r e a t Mother/Daughter morning out. It was, and we both thoroughly enjoyed listening to Trisha who was both entertaining and informative in her talk. She told us about how the idea of a Calendar had come about, how there had been divisions between the 12 ladies when the film offer came about, how they really didn't expect to sell 3000 never mind the 4 million copies they eventually sold. She is very humble about all the fantastic experiences this venture has given her and seems content on settling back into normal life without the stardom. She is just really pleased that all the attention has contributed to raising so much money for Leukaemia research. Listening to Trisha made me think about what a difference a small opportunity can make. When we are in business we sometimes shrug off doing something that is a little quirky, thinking that it obviously won't work as no one else is doing it, but when you recognise the percentage principle I have from the Entrepreneur's Circle below, you might think otherwise:

1 1 4 15 60 20

= = = = =

4

15

60

20

Super Successful (Very wealthy) Doing Very Well (Rich) Getting There (Making Good Money) Getting by Struggling

These percentages work for business in general or in your specific sector. Now, after you have thought about which segment you are in, take a look at how many people are either Getting by or Struggling – 80% (if you know about

Pareto's Principle and the 80/20 rule then these figures will make total sense). That means 80% of the people in your sector are doing things WRONG!! So if you are sat there following the crowd than you could be heading the same way. What you need to do is look to find who the 4 or even the 1 in your sector and see how they are marketing their business, are they doing things a little different? Are they standing out from the crowd? I would suggest you study 3 of the businesses that are top of their game and get on their lists; even become a customer of theirs if that's possible. Once you receive emails from them you can see how they interact with their potential clients and customers – this is a great way to pick up ideas that work. Can you imagine if the Calendar Girls has worried about what people would say about doing a “nude” calendar and stuck to doing one of churches or bridges – I know it wouldn't have raised anywhere near as much money for Leukaemia and I'm not sure it would not have made such a good movie – do you?? So why stick to the norm? Just think of something different and your Calendar Girls moment could be just around the corner.

Tracy x PRODUCTIVITY TIP

Small Gestures Make Customers Feel Like Kings Small gestures can go a long way towards making your clients feel like royalty. When used throughout the customer experience, these niceties will help you sell more, build loyalty and encourage word of mouth. If you are not sure where to start why not try a couple of these:

Include handwritten "thank you" notes when shipping your product and emphasize the importance of each client's purchase.

Deliver your product in an appealing packaging that elicits excitement and purchase gratification.

Show customers how to use your product and tell them exactly what they can accomplish with it.

Provide easy to follow instructions or tutorials with videos and images.

 

Greet them by name. Remember their anniversaries and birthdays, and thank them for their loyalty.


End of the Renewals Allowance on your 2013/14 Tax Return The renewal's allowance worked on the basis that you cannot deduct the initial purchase of an asset, so when fitting out a new rental property, there is no tax deduction for buying, say, a cooker. When the cooker needed replacing, however, the cost of the replacement was claimed as a “renewal”. Any sales proceeds from the old cooker were deducted, and the amount claimed was adjusted to reflect any element of improvement of the new cooker over the old cooker. The allowance applied to any trader, but it is particularly useful for landlords of residential accommodation. This is because, unlike commercial landlords and ordinary trading businesses, landlords of residential accommodation cannot claim capital allowances on plant and machinery installed in the accommodation. The landlord of a furnished property had a choice: he could claim the renewals allowance, or he could claim a “wear and tear” allowance calculated as 10% of the rent he received. In some cases the 10% wear and tear allowance worked out as the better choice, but there were other cases where the renewals allowance provided a better result.

When you dance, your purpose is not to get to a certain place on the floor. It's to enjoy each step along the way.

Dr. Wayne Dyer

HMRC announced that from April 2013, the renewals allowance will no longer be available, except for the strict statutory allowance for “trade tools” which is unlikely to be much help for landlords. The exceptions to the new rule is equipment such as boilers, water heater, air conditioning systems and kitchen units as HMRC deems this type of equipment to become part of the building once it is installed and therefore a replacement is counted as a repair. The only relief available to residential landlords for their 2013/14 self-assessment will be the wear and tear allowance, and this can only be claimed for fully furnished properties, so landlords of unfurnished residential accommodation will not be able to claim any relief at all for replacing such items as cookers, sinks, baths, and so on. Tip One: Furniture which has a useful life of less than two years doesn't count as capital expenditure, so you can claim a tax deductions for the full cost for the year of purchase. Where you provide furniture that is insufficient to qualify for the “wear and tear” allowance, you also won't be entitled to claim for the cost of renewing it unless it's permanently fitted to the building. So you'll be laying out money for your rental business, but with no tax relief to show for it. This hardly seems fair, but there is a solution. Tip Two: You could lease (rent) the furniture etc. you provide to tenants. The rules don't say that you have to own an asset to be entitled to tax deductions, merely that you “provide” it. Therefore, by paying rent instead of buying you can obtain tax deductions for even a few pieces of furniture. How this works: Where you rent furniture it's the leasing company that owns it, not you. They can claim CA's, but as far as you're concerned the lease charges you pay are fully tax deductible from your rental income. Believe it or not, there are companies that will lease anything to you from a tumble dryer to a bed. If you don't fancy paying a rental charge for the furniture you include with your accommodation then there is another option:

Tip Three: Charge your tenants a separate amount for furniture you provide. This won't count as part of your property rental business (unless you fully furnish the property). In effect you've created your own furniture leasing business and this allows you to claim Capital Allowances' for the cost of new furnishings against the amount you charge your tenant for using it. To avoid trouble with HMRC we advise drawing up separate rental agreements for furniture etc., and the accommodation.

Twitter of the Month Grow YOUR Business @TheSBOMag follows you

The Small Business Owner Magazine is packed with tips, insights and strategies to help you grow yourself AND your business. Editor: Dave Sharpe This magazine is great for any small business owner. You can read it straight from your ipad or tablet and best of all - its FREE!!


Business of the Month

Sadie’s Dog Training Sadie Brunskill is devoted to her dog Betty, her fourlegged soul-mate and Sadie has develop this enthusiasm for canine companions into her own business.

For Sadie, the administrative side of running a small business certainly has its' 'pups' and downs

Sadie found that more forceful approaches to dog training were simply barking up the wrong tree – not working for either dogs or their owners. She encountered this forceful type of dog training with her own dog and did not find any alternative trainers locally.

But Sadie says that after a year of running her School for Dogs, she 'absolutely loves the work she does, she couldn't see herself doing anything else!' In fact, Sadie even enjoys training dogs in her spare time!

Rather than sending Sadie into a 'howl' of frustration, she was inspired to investigate a more dog friendly approach to training As Sadie discovered more about effective dog training, she was increasingly asked by other dog owners to help train their dogs. As Sadie says, 'I was getting wonderful feedback about the results they were seeing, without having to be “cruel to be kind”!' This made Sadie explore dog behaviour and training techniques even further – almost like a dog with a bone! After four years, she was granted full membership of the Pet Professional Guild (the international association for force-free professionals) and now runs Sadie's School for Dogs. Sadie's School for Dogs offers 'force-free training and socialisation classes, one to one training sessions, behaviour consultations, dog walking and pet sitting services'. Both dogs and their owners appreciate Sadie's (very) kind approach to training. Sadie tells us: 'My passion lies not only in dog training, but in training with only kind, effective, science-based methods, as this provides the best results and creates a wonderful, trusting bond between you and your dog'. Not only does this benefit the dog, Sadie notes that improving a dog's behaviour can affect a whole family: 'I often see tears of joy when people start to see the transformation from 'naughty hell-hound' to 'joyful, obedient family pet''.

What does Sadie think that the government could do to help small businesses like hers in these 'ruff' economic times? For Sadie, more financial support (e.g. Job Seekers Allowance) for people hoping to start their own business would be welcome. Sadie hopes that more young people will take on the challenge of starting up in business themselves, as she did. Sadie aims to build her own training venue indoors in the next few years (important for the Cumbrian climate!) where she can hold more classes, as Sadie says, 'covering everything from puppy play sessions to starting out in dog sports'. TI Payroll and Accounting have been able to help Sadie with the aspects of a small business that she's less keen on? Being faced with a mound of paperwork connected with her small business certainly gave Sadie 'paws' for thought. Sadie admits that the biggest challenge she faced when starting up was dealing with the administration involved. As Sadie comments: 'Dogs I can do. Numbers and paperwork? Not so much!' This is when TI Payroll and Accounting came to Sadie's rescue. As Sadie comments, 'Tracy has been very supportive in helping me', which has made running her business much more straightforward. For Sadie, this help has 'freed up a lot of time for me to do more of what I love'. So Sadie's School for Dogs gives TI Payroll and Accounting top marks for their admin and financial help.


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The service I have received from Tracy and her team has been exceptional and very customer focused!

Elizabeth Brooksbank

payroll administration bookkeeping services construction industry scheme self employed limited companies tax returns SAGE training

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Ti payroll may2014 newsletter