Navigating the world of mileage claims, fuel receipts and vehicle maintenance can seem complicated. We often get asked about how to claim, what can be claimed for and how it needs recording. So, we have put together some useful information and tips to explain it all.
If you are required to use your own vehicle or company vehicle for work, you may be able to claim Mileage Allowance Relief from HMRC based on the number of business miles you travel. This tax relief could be worth up to 45p for every mile you have travelled since April 2011!
eBay recently wrote to business sellers to remind them of the upcoming changes to how VAT will be charged on fees. Effective from the 1st of August VAT will be applied to all fees. For the first time sellers will be able to reclaim the VAT on their VAT returns.
Historically sellers were unable to reclaim VAT but if they gave eBay their VAT number eBay would deduct the VAT at source. Then for the past 18 months eBay had special dispensation to not charge VAT for any business seller (even if they weren’t VAT registered).
This follows on from last year’s package of measures introduced by the Chancellor, aimed at tackling the rapidly growing VAT evasion by overseas traders that sell goods in the UK via online marketplaces such as eBay, Amazon and others. As a result, HMRC was given the power to force online marketplaces to ensure that their overseas customers were registered and accounting for VAT or risk being liable for the VAT themselves.
The change to how eBay charge VAT
Now, from the 1st of August eBay UK will bill from a UK entity and charge VAT on fees and only those who are VAT registered and able to claim input tax credits will be able to recoup the VAT paid to eBay.
Many sellers have welcomed the move – eBay will be charging VAT as a UK entity and the VAT will be passed to the exchequer. Sellers, especially those who have been suspected of dodging VAT will find the VAT added to their eBay invoice and if they’re not registered for VAT with HMRC won’t be able to claim it back!
For sellers who can reclaim VAT it’s effectively just a cash flow and accounting change with no financial impact to their bottom line.
Those it will negatively impact
There are a few sellers who will be negatively impacted – sellers registered as businesses whose turnover is too small to compulsorily register for VAT will either start paying VAT at 20% or take the decision to voluntarily register. Also sellers on certain VAT schemes who are unable to reclaim input VAT will also see their costs rise. It’s important to realise that this isn’t eBay’s fault however (net fees are not changing). VAT is a government mandated charge and for the past 18 months sellers have had a free ride and it’s just that this added Brucie bonus is coming to an end.
What if you’re billed mid month?
If you’re a business seller billed on the 15th of the month, your invoice dated the 15th of August 2017 will show VAT on all your fees. However, you’ll also see a credit for any VAT applied to your fees between the 16th and 31st of July.
If you need further help or have questions on VAT, we’d be happy to help. Perhaps we can help organise your accounts with a free month of Xero? Get in touch to organise a free of charge consultation. Drop us an email firstname.lastname@example.org or give us a call 01858 289189
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Cloud storage is becoming an essential part of running a business, and we know those late to the party are feeling a bit left behind. Today I’m going to run down some of the best options out there to help narrow your search and encourage you to take your business to the cloud.
Instead of being stored locally on your machine, data stored on the cloud is stored on the provider’s server and is accessed through the internet. There are three main motivations behind storing files in this way, and sometimes they seem at odds with one another. The first is security, as businesses need a safe place to store important documents and need control over access permissions. The second is collaboration, as files need to be shared easily around the office. The third is remote access, so you can get to your data when working from home or edit that presentation while on the train.
As you do more research, remember to look at costs in depth; many offer a number of different plans so you risk paying for services you don’t use.
The best known and most popular, Dropbox is the cloud storage benchmark. If something is going to link to a cloud provider, Dropbox will be first on the list making it the best option for combining with different apps and plug ins. It has also got some useful features of its own; the local folder on your computer can be accessed offline and will sync when online, plus it backs up changed files so older versions and deleted files can be accessed and restored. Real time online collaboration will be used all the time in offices that require multiple people to work on the same project.
Zoolz takes a unique approach by storing rarely used files separately. These ‘cold’ files are kept in inactive storage and require 3 to 5 hours before they can be accessed, using less space and ultimately saving you money as your plan is customisable based on how much data you want to store. Zoolz is ideal for companies with lots of documents that need storing but don’t often need accessing.
JustCloud is a great option for bigger companies with lots of files to store, or companies still growing. Business plans start at 100GB but go up to unlimited storage space which is not strictly necessary for most businesses, but does allow for a lot of room for expansion. We really like the administrator’s panel, from which you can control user access and how much storage each user is allowed. Administrators can also monitor the changes made to documents. JustCloud can be difficult at first as it cannot handle large amounts of data being shipped to it at once; this shouldn’t be a problem later, but can be a pain when setting up.
Box has less of an emphasis on personal use than the others on this list, and has been specifically designed businesses in mind. It’s well designed, easy to customise and is supported by lots of extra plug ins and apps. For example, there is one for linking directly to Office so all files are automatically backed up in Box. The amount of features means that this one is confusing to new users or non-business users but once you get used to it, you will find that this system can support your every business need.
This one links so well to other Google services, that it is the no-brainer option for people that use Gmail already. There is a downside with this: as you share storage space with your email account an overflowing inbox will give less cloud space. The GoogleDrive emphasis is on personal use, but some features are perfect for businesses. For example, with the selective sync feature you can choose which folders sync on each device. Like Dropbox, real time collaboration is supported and the interface is very simple to use as a file tree shows where all files are stored.
Let’s finish with something a little bit different. Spideroak is all about privacy: with the other cloud systems, the companies technically have access to your files, but here files are encrypted by your local folder meaning that the data is readable only by you. This may make it sound as if accessing files from other machines would be a problem but a control centre app that operates on different machines can work around it. This service isn’t really about collaboration or integration but is excellent for security, and proves that businesses must work out their needs before choosing a storage system.
If you want to talk to us about your bookkeeping or accountancy requirements, we offer completely free of charge business consultations so we can get to know each other and see if The Business Hut is a good fit for your business.
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For so many modern business challenges, there is an app solution. If finding the programs that are perfect for your business is difficult, finding ones that are compatible with each other can be impossible. The Xero App Marketplace is a great place to start looking as it’s filled with apps that connect with and support Xero. There are over 500 out there, covering every possible business need. You can search via both the app function and business type.
There are new apps being added all the time, and here are some recent highlights.
Business intelligence software for small businesses looking to accelerate growth, Grow specialises in bringing together data from different sources, so you can compare Xero reports with other data. Grow is easy to use, with a customisable dashboard and uncluttered display. Insights are tailored to your business and key objectives can be highlighted with the easy customisation options.
ExcluServ Connect integrates Concur and Xero. Concur is a powerful app that controls all your expenditure, managing expense, invoice and travel. ExcluServ Connect provides support for managing billable expenses and viewing all your expense receipts as attached images to Purchase Invoices in Xero.
CaFE stands for Cash Flow Engine and allows for accountants and bookkeepers or their clients to manage cashflow. The app is always running and automatically syncs, so can highlight impending shortfalls and surpluses instantly. It is always there when you need it and the reports produced are easy to understand.
Every app should focus on saving time and minimising hassle, and Instafile does both brilliantly. It lets Xero users file Limited Company Accounts and Corporation Tax Returns directly with Companies House and HMRC; an easier way to do statutory year end filings, saving lots and time and avoiding the mistakes manual data-entry can lead to. Its compatibility with Xero is seamless as the app was developed with constant of feedback from the Xero user community.
Using cloud accounting software and applications puts you in control. You can decide who can view data, and control each user’s level of access. The cloud really is the safest place for your accounts to be.
If you want to talk to us about your requirements for a bookkeeper or accountant, we offer completely free of charge business consultations so we can get to know each other and see if The Business Hut is a good fit for your own business.
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Procrastination is part of human nature, it’s amazing how mundane things like housework become super important when you have a project on the go or deadline that should be tackled. The house and garden usually gain more attention when putting something off. As small business owners one of your new year’s resolutions may have been to convert to a new accounting software in the new financial year.