The initiative, startupM8, is led by Somerset Businessmen Tim Myerson and Phil Bower and supported by Adrian Stallard from Lentells Taunton office, who has a wealth of experience working with small companies.

StartupM8 offer one day courses that de-mystify the whole experience of what is really involved in starting and running your own business in an informal and inclusive setting. Numbers for each course will be restricted to just 10 to create a supportive and open atmosphere. The initial workshops will give a realistic and jargon free over-view into the key aspects of starting a business, including looking at the viability of business ideas, initial legal and financial obligations and the general implications, both

professional and personal, of running your own business. Additional follow up courses will cover more specific aspects of running a business including financial and legal implications and approaches to marketing.

For more information please go to www.startupM8.co.uk or call 01823 240048

LenteLLs news

newsBusiness Advisors And Tax Specialists

Issue 9 Summer 2011

In the past, missing the deadline for filing self assessment tax returns by an individual, partnership or trust by a few months only gave rise to a penalty of £100 per return, which has been the position for over ten years. Indeed if there was no tax liability arising in relation to that return, then the penalty was normally waived.

However, from 6 April 2011 the late filing of such returns will give rise to much larger penalties. The deadlines for filing paper returns for this year will be 31 October 2011 and for filing online 31 January 2012.

The new penalty regime will mean that if the returns are not filed by those dates, there will automatically be a £100 penalty per return, in the case of partnerships per partner, regardless of whether there is any tax payable or not. In addition, once the returns are more than 3 months late, there is a £10 per day penalty which will be automatically imposed for the following 90 days whilst the return still remains outstanding

up to a maximum of penalty of £900. Once the return becomes more than 6 months overdue, the penalty rises to whichever is higher; 5% of the tax on the return or £300. Even if there is no tax liability at all in those cases on an individual self assessment return, one would be looking at a penalty of £1,300.

If tax returns are more than 12 months late in being filed, then much steeper penalties will be imposed by HM Revenue & Customs in addition to the above penalty regime.

We would therefore recommend that tax returns are filed in due time in all cases to avoid this penalty regime. If a tax agent is used, information to enable the tax return to be prepared should be provided in good time.

LenteLLs PARt OF LOCAL InItIAtIVe FOR tHOse COnsIDeRInG BeCOMInG seLF eMPLOYeD

new PenALtIes FOR LAte FILInG OF seLF AssessMent tAX RetURns – DOn’t Get CAUGHt OUt

A group of Somerset based companies have come together to offer a series of workshops and related support packages aimed at individuals considering starting their own busi-nesses in the area.

The work-based pensions reform will require auto-enrolment into a pension scheme for all ‘eligible jobholders’. Each employer will be given a date by which they have to comply - the staging date. Large companies will be expected to comply first; those companies with under 50 employees are unlikely to be contacted until 2014 at the earliest.

Employers will be responsible for providing an approved ‘qualifying scheme’ for all workers who earn more than the minimum earnings threshold, are aged between 22 and state pension age and work in the UK.

There will be a minimum contribution of 8% of qualifying earnings (currently £5,175 to £38,185 per annum), of which the employer must pay a minimum of 3%, the employee will pay 4% with 1% paid as tax relief by the government.

What should I do now?

• Prepare well in advance for these changes. To ascertain your staging date go to www.tpr.gov.uk/staging

• Check sooner rather than later that existing schemes meet the necessary statutory requirements to become a ‘qualifying scheme’. Many occupational and group pension schemes will qualify and even those that are not currently eligible may find it relatively straight forward to change the scheme rules or amend the terms of the policy accordingly prior to the staging date.

• Start researching your options in regards to starting up a ‘qualifying scheme’ or consider contributing to NEST, the National Employment Savings Trust. This is a new trust- based occupational scheme set by the Personal Accounts Delivery Authority (PADA). The responsibility for enrolling employees into NEST and collecting and paying over contributions to the scheme will fall on the employers.

The Institute of Directors, while welcoming improvements to retirement provision, has warned that the changes will hit smaller businesses hardest. Feedback from IoD members indicates that 95% of those who do not have any pension arrangements for employees are SMEs. It is these smaller businesses that will have to implement and finance auto-enrolment, adding to their administrative and financial burdens.

2012 CHAnGes tO PensIOn LeGIstLAtIOnFrom 2012 changes to the pension law aimed at encouraging more people to save for their retirement will affect all employers with at least one employee.

4 Lentells Report News

Register Todaywww.lentells.co.uk

Finding your way through the maze of information available on the internet presents a challenge. Register for free on our website to get useful tips and articles on accountancy, latest Budget News and Weekly Newsletters.

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HOw tO COntACt Us

Chard

17-18 Leach Road,

Chard Business Park, Chard,

Somerset TA20 1FA

Telephone: 01460 64441

E-mail: chard@lentells.co.uk

Lyme Regis

St. Georges House,

Uplyme Road Business Park,

Lyme Regis, Dorset DT7 3LS

Telephone: 01297 443182

E-mail: lyme@lentells.co.uk

taunton

Ash House, Cook Way, Bindon Road, Taunton, Somerset TA2 6BJ

Telephone: 01823 286274

E-mail: taunton@lentells.co.uk

Seaton

50 Fore Street, Seaton, Devon EX12 2AD

Telephone: 01297 20584

Email: seaton@lentells.co.uk

Lentells is registered to carry out audit work and is regulated for a range of investment business activities by the institute of Chartered Accountants in England and Wales.

This firm is not authorised under the Financial Services and Markets Act 2000 but we are able , in certain circumstances, to offer a limited range of investment services to clients because we are members of the institute of Chartered Accountants in England and Wales. We can provide these investment services if they are an incidental part of the professional services we have been engaged to provide.

 

LenteLLS SponSoR SomeRSet BuSIneSS AWARdS

Full story....... p3

LenteLLS dIReCtoR SuppoRtS InItIAtIve FoR neW StARt upS

Full story....... p4

LenteLLS AppoInt neW AppRentICeS

Full story....... p4Matt joined Lentells Chard office at the beginning of July having just c o m p l e t e d his A levels at Holyrood

Academy in Chard. He is currently completing an intensive bookkeeping course and as part of the Government’s apprentice initiative will start his AAT training on a day release basis at Richard Huish College in Taunton. Matt said “It is great to have the opportunity to gain experience of working in an office

while at the same time studying for the exams; I hope this will enable me to put what I learn into practice”.

James Orchard will join the Chard office in September. He has just completed his AS’s at Richard Huish. James was in fact mentored by Jane Jordan, a Director of Lentells Healthcare Division, who volunteered as a mentor under the Government’s STEMNET scheme, an initiative to encourage young people to consider careers in science, technology, engineering and maths.

“Becoming a mentor has been a very rewarding and interesting

LenteLLS tAKe on tWo neW AppRentICeSLentells have appointed two young apprentices to study towards AAt, matt Foote and James orchard.

Most businesses are aware of the need to retain records for six full years, but what needs to be kept? This will vary from a simple box of invoices to a fully computerised accounting system with supporting documentation. If you are unclear about the requirements for your business, you should discuss with your accountant or refer to the Business Link website.

What should you do if your records are selected for review by HMRC?

Your first call should be to your accountant. If there are any doubts over the integrity of your records, you should then agree an action plan to correct any shortcomings prior to review by HMRC.

Going forward it is likely that many small businesses will need to put more effort into their record keeping. Those that do not have the time /skills to do so should consider employing external help.

Improved records will help control your business finances, satisfy HMRC and may even reduce your tax and accountancy bills.

Lentells are able to offer advice on all aspects of bookkeeping, accounts, tax, payroll and VAT to support small businesses. For a free initial consultation, contact Jane Jordan on 01460 64441 or email jane.jordan@lentells.co.uk

ARe YOUR ReCORDs UP tO sCRAtCH? Hm Revenue & Customs (HmRC) estimates that 40% of businesses do not keep adequate records. In response, they are planning to review up to 50,000 cases per year with potential penalties for significant failures.

experience and we are delighted that James is now joining Lentells to continue his training” said Jane, “Working in partnership with Richard Huish on the day release scheme is an ideal way for these young apprentices to pursue their training while at the same gaining valuable experience of working in an office as part of a team”.

Following on from an announcement in the last budget HM Revenue and Customs have published a consultation document outlining in more details its plan to cut the rate of inheritance tax on estates where a proportion is left to charity.

The rate is to be reduced to 36 per cent as long as 10 per cent or more of the value of an estate is bequeathed to charity. Inheritance tax is normally due at 40 per cent above the nil-rate band which currently stands at £325,000.

PROPOseD CUt In InHeRItAnCe tAX eXPeCteD tO BOOst CHARItIes

Our “understanding Your Accounts” seminars held earlier this year in March were a huge success with over 120 GPs and Practice Managers attending over four sessions. We are now planning to hold a further two seminars on 14 September and 6 October, which

will provide additional information on balance sheets, property and partnership issues, forecasting and budgeting.

to book a place please contact; trissa.hoskin@lentells.co.uk or call 01460 64441

LenteLLs MeDICAL DIVIsIOn: seMInARs FOR GPs AnD PRACtICe MAnAGeRs

many small businesses are being charged

backdated energy bills in some cases

going back up to six years for thousands

of pounds as a result of undercharging.

At present energy providers can only

serve backdated bills for one year’s energy

usage for domestic customers, but no

such legislation currently exists to protect

business clients. Organisations representing

small businesses are now lobbying the

energy regulator Ofgem to end the rule that

allows business customers to be treated in

this way, especially small businesses that are

often in no position to receive unexpected

bills for many thousands of pounds for

immediate payment.

sMALL BUsInesses FACe BACKDAteD eneRGY BILLs

LenteLLs sPOnsOR sOMeRset BUsIness AwARDs

There are significant changes about to occur regarding retirement legislation which will have a huge impact on the way you run your business in the future. If you choose to do nothing you may find yourself facing legal action.

Historically, when an individual approaches retirement age you could give six months notice that you want them to retire. From 6 April 2011 this will no longer apply as the default retirement age (DRA) is being phased out. The impact of this on your business is that you will no longer be able to end an employee’s contract on the grounds of age and they can continue to work for you for as long as they are capable of doing the role. This will apply to anyone who reaches the age of 65 after 30 September 2011.

This has no affect on the statutory retirement rules and an employee still has the right to retire once reaching statutory retirement age if they choose to.

These changes will have huge implications for the way that businesses work with regards to planning for succession, workforce planning and in the way that a business ensures consistency and fairness in their policies to ensure that older employees are not discriminated against or given any special allowances.

It will also have implications for employees as it will affect career progression and promotion opportunities.

Employers who fail to implement the new legislation could face claims of unfair dismissal and discrimination.

In reality as individuals approach retirement they often tend to wind down toward their eventual retirement. Employers tend to accept this as they know that it is only for a short while until the individuals retire. However, in future businesses will need to regularly review all employees regardless of age and make it clear what is expected of them.

Is YOUR BUsIness ReADY tO ACCOMMODAte An AGeInG wORKFORCe?

By law, businesses with an annual turnover of more than £73,000 (the current threshold) must register for VAT and send HMRC regular returns and payments.

Mike Wells, HMRC director of risk and intelligence, said: “The aim of the VAT Initiative is to make it easy for individuals and businesses to contact us, make a full disclosure of their income and face a reduced penalty. I urge people who have not registered their businesses for VAT to get in touch and get their tax affairs in order simply and on the best available terms.”

If you believe that your business may fall into this category it is essential that you contact HMRC immediately as they are offering a partial amnesty until 30 September 2011. Businesses

HMRC tARGets VAt DODGeRs

more than 40,000 businesses will be contacted over the next couple of months by Hm Revenue & Customs (HmRC) as part of its vAt Initiative to identify businesses that are currently trading above the vAt threshold but have not registered.

HMRC have announced new fuel rates for

company cars, which apply to all journeys

made on or after 1 June 2011. For one

month from the date of change, employers

may use either the previous or new rates.

The rates are now going to be reviewed

four times a year and any changes will take

effect at the beginning of each calendar

quarter. Due to the increased frequency

of the reviews HMRC have decided that

they will no longer consider changing the

rates if the fuel price fluctuates by 5% from

the published rates. Petrol hybrid cars are

treated as petrol cars for this purpose

Customs will accept the figures in the table for VAT purposes though employer will need to retain receipts in line with current legislation.

new FUeL RAtes FOR COMPAnY CARs

engine Size petrol Lpg

1400cc or less 15p 11p

1401 to 2000cc 18p 13p

Over 2000cc 26p 18p

engine Size diesel

1600cc or less 12p

1601 – 2000cc 15p

Over 2000cc 18p

Broadband Delivery UK has announced that two areas in the South West successfully bidded for £34 million for superfast broadband to help encourage economic growth in the area. The successful bids, one from Somerset and Devon

(£30m) and another from Wiltshire (4m) will also secure additional financial support from their local authorities and private investors. It is estimated that as a result £100 million could be injected into the South West region.

sOUtH west wIns MULtI MILLIOn POUnD BROADBAnD InVestMent

It is proposed that the changes will come into effect from 6 April 2012.

Organised by the Somerset Chamber of

Commerce the awards aim to recognise

and promote the county’s diverse and

talented entrepreneurs. This year’s awards

were unveiled at the Bath and West Show

where the Chamber of Commerce was

delighted to welcome the Countess of

Wessex at the launch. 2011 will see fourteen

categories with new awards announced for

the Best Family Business and Environmental

Responsibility. As in previous years Lentells

will be sponsoring the Self Employed Sole

Trader category. For further information on all

the categories and how to enter please go to

www.somersetbusinessawards.org.uk. The winners

will be announced on 21 October at a

reception to be held at the Somerset County

Cricket Ground.

2 Lentells Report News Lentells Report News 3

Lentells are delighted to announce that they will again be sponsoring a category in this year’s Somerset Business Awards.

Jane JordanHealthcare Director

that come forward and make a full voluntary disclosure will pay a reduced penalty of 10% of the tax owed as long as the outstanding tax and the penalty are paid in full by 31 December.

After 30 September HMRC will investigate all those who have failed to come forward after which substantial penalties or even criminal prosecutions could follow.