The end of the tax year can prove stressful for some, but this annual deadline focuses the mind on financial matters and forces us to get things in order.
The end of year accounts provide valuable information on the health of your business. Knowing we have to get things straight makes us take action on things which may have been put to the bottom of the pile, seek professional support and take time to reflect on the past year. It makes us allocate time to taking stock of areas which are going well and reaping rewards, areas which need addition investment to reach their potential and areas which are weak and could be cut.
In taking time to understand our financial position, we have the foundations on which we can build realistic financial plans for the coming year. We can look at income, expenditure and cash flow to understand where cuts need to be made, what money we have money to invest and where that is most likely to generate a return.
If you’ve felt the pain of getting everything in order for the end of the tax year, it may also be the ideal time to engage the services of a professional accountant. With their support it can be far easier to develop effective systems for managing your business accounts, tax payments and getting your annual returns to Companies House.
A good accountant will not simply complete your accounts; they will also provide advice on how to reduce your tax bill within legal restrictions. They can provide information on where to hold money that is being set aside for future investment, so it generates the most tax efficient returns and provide advice to ensure that your business is compliant with financial regulations.
Employee Benefit Trusts
Financial regulations are constantly changing, so an accountant will be able to provide the most current advice that is relevant to your business. One of the issues that has to be resolved before the end of this tax year are Employee Benefit Trusts (EBT). Until 2011, these were seen as a way to set aside money that could be used by employees for training, social events, loans etc. However many companies used EBT as a tax avoidance scheme.
Since the Finance Bill 2011, HMRC have been clamping down on companies who were believed to be using EBT for tax avoidance. EBT are no longer seen as an acceptable financial arrangement for any business. If your company is still using EBT, or have yet to close an EBT that was used in the past, it is at risk.
Until 31 March 2015, HMRC are offering a settlement opportunity to those who have used EBT. If tackled before this deadline, a financial settlement will be agreed and no litigation will be made. You can deal with the issue directly with HMRC, or you can talk with a specialist accountant who can help you work through the process and find the best option for your particular case.
Pareto Lawrence http://www.paretolawrence.co.uk/employee-benefit-trusts/ have expertise in EBT resolution. We not only advise on the best action for EBT compliance, but also assist with other aspects of your financial management, to ensure your money is working effectively for your business.