Back to Business Basics. Chiene + Tait Chartered Accountants Carol Flockhart, Helen Mackenzie and Justine Riccomini Wednesday 23 March 2011

23 March 2011 Back to Business Basics 2 Running Order  Session 1 – Business plans and forecasting  Session 2 – General tax and tax tips Coffee break  Session 3 – Cash flow management  Session 4 – Employment tax Questions and close

Back to Business Basics Session 1 Business Plans and Forecasting Carol Flockhart Wednesday 23 March 2011

23 March 2011 Back to Business Basics 4 Topics to Cover  What is a business plan and why need?  What should it include?  Business plan tips  Importance of financial forecasting  What should forecasts include?  Forecasting tips

23 March 2011 Back to Business Basics 5 Why Produce a Business Plan?  To secure funding  When selling your business  Plenty of internal reasons

23 March 2011 Back to Business Basics 6 What Should a Business Plan Include?  Executive summary  Background to the business  Market and competition  Business development  The people  Operations  Forecasts  Appendices

23 March 2011 Back to Business Basics 7 Elements of a good business plan  Succinct and logical  Clearly defined sections  Clear and objective  Unique selling point?  Funding – demonstrate need  Demonstrate skills and experience  Executive summary is key!

23 March 2011 Back to Business Basics 8 Tips on Business Plan Presentation  Short and focused  Professional  Third party sense check  Feedback from external advisors  Avoid jargon  Use of appendices

23 March 2011 Back to Business Basics 9 Financial Forecasts  Profit and loss  Cashflow  Scenarios (what if)  Balance sheet  Assumptions

23 March 2011 Back to Business Basics 10 Forecasting Tips  You have responsibility for the figures  Consistency  Realistic  Monitor on ongoing basis  Challenge your forecasts  Excel or specialised software?  Detailed assumptions  Tax!

23 March 2011 Back to Business Basics 11 Finally…  Do you have a business plan?  Does it need updating?  Are your forecasts realistic?  Do you use your forecasts to help manage your business?

Back to Business Basics Session 2 General Tax and Tax Tips Helen Mackenzie Wednesday 23 March 2011

Back to Business Basics Session 3 Cashflow Management Carol Flockhart Wednesday 23 March 2011

23 March 2011 Back to Business Basics 14 Topics to Cover  Difference between cashflow and profit, and importance of cashflow management  Credit control and customer management  Other factors including supplier management  Importance of good management information  Relationships with banks

23 March 2011 Back to Business Basics 15 Difference Between Cash and Profit VsVs

23 March 2011 Back to Business Basics 16 Credit Control and Customer Management  Know your customer  Payment terms  Invoicing  Cash collection

23 March 2011 Back to Business Basics 17 Top Ten Tips to Reduce Number of Slow Payers 1. Know your customer 2. Invoice promptly 3. Reminders 4. Obtain names 5. Making the call

23 March 2011 Back to Business Basics 18 Top Ten Tips to Reduce Number of Slow Payers 6. Keep records 7. Electronic payments? 8. Compromise? 9. Take legal action 10. Be polite, professional and persistent

23 March 2011 Back to Business Basics 19 Other Factors  Supplier management  Stock control  Control overheads

23 March 2011 Back to Business Basics 20 Good Management Information  Cash flow forecasting  Management accounts  Key performance indicators

23 March 2011 Back to Business Basics 21 Managing Banking Relationships  Keep on side  No surprises  Clear, regular financial information  Monitor bank covenants

23 March 2011 Back to Business Basics 22 And finally… Cash is King!

Back to Business Basics Session 4 Employment Tax Justine Riccomini Wednesday 23 March 2011

23 March 2011 Back to Business Basics 24 Agenda  Directors’ NIC  Time Limits & Penalties  Expenses  P11Ds & Class 1A NIC  P35 Deadlines/ Payroll  Salary Sacrifice  New Rates & Allowances – 2011/12  Other Budget Points

23 March 2011 Back to Business Basics 25 Directors’ NIC  Annual Earnings Period  Starting/ leaving part way through a tax year

23 March 2011 Back to Business Basics 26 Time Limits  P35/ P14 – 19 May (online)  P60 – to employees by 31 May  Form 42 etc – 6 July  P11D & Class 1A NIC – 6 July/ 19 July  PSA – 6 July/ 19 October

23 March 2011 Back to Business Basics 27 Penalties Penalty for: P35Class 1AP11DPSA Non- submission £100/ 50 ees <12 months £100/ 50 ees <12 months £300 + £60 per day 5% + 5% + 5% 1, 6, 12 months Incorrect submissions (Fraudulent or negligent) = amount of taxes due Up to £3,000= amount of taxes due InspectionsLost revenue £ InnocentUp to 30% Deliberate & unconcealed Up to 70% Deliberate & concealed Up to 100%

23 March 2011 Back to Business Basics 28 Expenses  Claiming  Authorising  Setting up a policy  Terms & conditions of employment  Policing  When it goes wrong  Fraud  Bribery Act & client entertaining

23 March 2011 Back to Business Basics 29 P11Ds & Class 1A NIC  What is a P11D?  Why bother getting it right?  What is Class 1A NIC?  What is a P11D dispensation?  What is a PAYE Settlement Agreement?

23 March 2011 Back to Business Basics 30 P35 Deadlines/ Payroll  P35 submission date = 19 May – online  Are P11Ds to be done?  Pecuniary liabilities and Class 1NIC  Changes in paternity leave provisions  HMRC plans for PAYE – RTI  – “what’s new”

23 March 2011 Back to Business Basics 31 Salary Sacrifice  Pensions  Childcare  Bikes to work  Car parking  Bussing employees to/ from work  Company cars  How does it work?  How do I do it?  Does HMRC approve?

23 March 2011 Back to Business Basics 32 New Rates and Allowances – 2011/12  BR - £1 – 35k – 20%  HR - £35,001 – 150,000 – 40%  AR - £150, %  NIC – 1% across the board - Class 1NIC – 12% for employees, 13.8% for employers, AR – 2%  PA - £7,475 for under 65’s  BR limit reduced to £35k – bringing 400,000 more people into HR bracket

23 March 2011 Back to Business Basics 33 Rates and Allowances – 2011/12 Contd  HR taxpayers will pay an additional £480 in tax each year  BR taxpayers will pay £680 less each year  Introduction of code “D1” – AR payers

23 March 2011 Back to Business Basics 34 Questions?