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Why it pays to get help to set up a limited company

Why it pays to get help to set up a limited company

You have been thinking about it for a while and you are now ready to take the plunge and get your own business going. Enough with working for others, it’s time to be your own boss. You have the idea, you have the funding (or financial backing), and you know exactly how you want things to work.

The first step is getting the business officially set up. This is where things can get a little uncertain if you have not done this before. There are a number of options available when setting up your own business and you need to be sure that you pick the right one for you and your circumstances. For many the best way is setting up a limited company. Suddenly what seems like a straightforward process can become a bit of a headache as you attempt to navigate your way through the mountains of paperwork that are required in order to get going.

At this point, getting a bit of expert advice and help could be the difference between getting it right and potentially getting it very wrong. You are also no doubt more than a little distracted with all the other administrative processes that go hand in hand with setting up and running a new business. So why bother trying to do it all when you can get some specialist help to set you up properly?

Using a professional to sort it out for you has a number of advantages:

They know how to navigate the system efficiently. Setting up a limited company requires completion of certain specific documents including articles of association and decisions on people with significant control in the business. You will also need to register your new company with Companies House, as well as do all the checks you need to do to ensure that your proposed company name is unique and available for use.

They add value. As well as giving you back precious time to do the things you do well as part of organising and running your business – i.e. finding new clients, servicing the ones you already have, organising suppliers, office space, promotional materials, etc. – they can advise on the order of when things need to be done to ensure that the process is smooth. With significant experience in doing precisely this for a number of businesses, they know what needs to be done and can advise accordingly so that you are not wasting your time trying to do things before they become necessary (or worse, missing something and having to go back a few steps).

They keep on top of things. As things become due they will either be able to get on with it on your behalf, or know when to come to you for your approval (where required). This allows you to keep your focus on all the other things going on in the set up and running of the new business.

A small investment in using professional services to set up your new limited business definitely makes good business sense. For advice and assistance Cain and Beer are on the end of a phone or email to help you out – call us on 020 3633 1340 or email us at – we’d be delighted to help.

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business meal cain and beer

Is VAT allowable on Business Entertaining?

We get asked this question a lot by our clients and the answer unfortunately is NO you can’t claim the VAT on business entertaining as a rule.

However, you can claim the VAT element on entertaining your staff and overseas customers. So, if you had a Christmas party for all staff you could claim the full value of the VAT. If the Christmas party was for staff and their partners then you would have the deduct the VAT proportion of the partners.

If you need advice on which expenses you are allowed to reclaim the VAT on then please just ask by emailing us at calling us on 020 3633 1340 or you can contact us via our website www.cainandbeer.com.

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10 Things Your Bookkeeper Should Do For You

10 Things Your Bookkeeper Should Do for You

1 – Give You Back Your Precious Time  

Do you really want to be spending your evenings and weekends doing your bookkeeping even if you know what you’re doing and unfortunately, a lot of business owners don’t! You probably think that it is best to do everything yourself to keep your costs down but it is best to leave important jobs like your bookkeeping to an expert; the outlay can easily be saved in the long run. A good bookkeeper will save you time; valuable time that can be better spent by you growing your business. Do you really want to be spending your evenings and weekends doing your bookkeeping even if you know what you’re doing and unfortunately, a lot of business owners don’t!

When you start out in business it is easy to get caught up with everything that needs to be done, cleaning your office or workplace, making the tea, organising your staff (if you have any), ordering stationery, buying stamps, collecting work, buying tools and materials, going to the bank and oh yes keeping up to date with your paperwork and updating your books!! Although it saves you money initially, all these things actually stop you from doing what you started out in business in the first place to do and make money.

2 – Save You Money 

If you have been keeping your own records and preparing your books or even if you fall into the trap of putting all your receipts and paperwork into a shoe box or carrier bags for your accountant at the end of the year, then, a bookkeeper can definitely save you money. An accountant’s fees or hourly rates will in most cases be a lot higher than a bookkeeper’s so your bookkeeper could actually save you money in accountant’s fees by preparing the books for your accountant to check so he or she won’t have to do all the legwork. There are also other areas where your bookkeeper could save you money these will be touched on later.

3 – Keep You Up to Date

As the emphasise is moving more towards ‘cloud accounting’ it is now possible to view your accounting position in real time so your bookkeeping should be done for you at least quarterly. Ideally if your bookkeeping is completed weekly you will always be up to date and know exactly where you stand, how much you have in the bank, what transactions are still to go through, how much you owe and to who and also how much you’re owed and by who.

4 – Prepare Regular Financial Reports for You 

If your bookkeeping is prepared for you weekly then at the end of each month your bookkeeper should provide you with some basic monthly reports which at the very least should include a profit & loss, a balance sheet, an aged debtors and an aged creditors list.

5 – Give You Detailed Management Accounts 

A bookkeeper worth his salt should also produce detailed management accounts; these are an extension to the regular monthly reports and provide drilled down information. For example, if you sell products you may need to know your best sellers or which products are the most profitable. You might also like to compare your figures from previous months or years so a report showing you a whole year month by month will be of real value.

These reports are key to helping you make informed financial decisions for your business and they will also show you what your ‘breakeven’ figure is which is basically how much you need to make to cover your overheads.

6 – Explain to You What It All Means 

Each month or at the very least every 3 months you should have a review meeting with your bookkeeper to go through your figures; during this meeting your figures will be explained to you. It is also an opportunity for you to ask questions and receive sound financial advice without having to wait until the end of the year. If you need

7 – File Your Returns Returns On Time 

It is essential that your VAT, PAYE, Corporation Tax, Self-Assessment and Annual Accounts are filed on time and these days HMRC are fining very heavily when you are late. If your bookkeeping is kept up to date, then there should be no reason for your returns to be filed late. Your bookkeeper should produce your VAT return and make you aware of when it should be filed by and how much you are due to pay and by when.

 

8 – Liaise with Your Accountants

At the end of your financial year, your accountant will need to prepare your annual accounts and calculate your Corporation tax payments using the bookkeeping that has been compiled by your bookkeeper. Your accountant will in most cases, need to ask questions or get clarification on certain transactions so your bookkeeper should be available to answer those questions.

 

9 – Deal with HMRC On Your Behalf 

Every now and then you may receive correspondence from HMRC and have a need to communicate with them. Your bookkeeper should be available to liaise with HMRC on your behalf and assist you if there is an inspection. Again, as your bookkeeper has prepared your accounts he or she will be best placed to speak to HMRC as they will have first-hand experience of the records.

 

10 – Assist with Your Cash Flow 

You have probably heard the expression ‘Cash is King’ well the truth is that so many businesses fail due to lack of cash despite being owed a lot of money. A decent cash-flow forecast should be part of your management reports that you receive but if it isn’t your bookkeeper should at the very least, keep you abreast of where you stand.

If you would like further advice about any of the above 10 points then please do not hesitate to contact us either by calling us on 020 3633 1340, emailing or via our website www.cainandbeer.com

 

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Bookkeeping services, London

Bank charges need not cause you grief

Do sights like this cause you worry? Then read about some of our handy hints below

It is so important to always know where you are with your bank account and keep regular tabs on incomings and outgoings. It is all too easy to bury your head in the sand and leave your bookkeeping to chance but that comes at a premium.

Things can be a lot easier if you use accounting software like Sage; providing you keep it up to date that is; you will know when certain payments are due out of your account.

Have you any idea how much your bank charged you in the last 12 months for going overdrawn without an overdraft or for unpaid transactions and unauthorised overdraft interest? If it is high that should be enough of a wake-up call to ensure you don’t get hit like that again in the next 12 months.

By taking a few simple steps you can drastically reduce your bank charges: –

  • Write a list of all your regular payments in date order on a spreadsheet showing payees and amounts payable. If the amount varies each month then make an educated guess based on previous months.
  • Add this list to your calendar as events, showing payee and amount for each direct debit and set a reminder for a few days before to check your bank account.
  • Do just that! Check your bank account to see if there will be enough cleared funds.
  • If there is enough money, great do nothing! If there isn’t, you need to take action right NOW! You either have to cancel the payment or pay money into your account.

This may cause a bit of inconvenience to cancel payments but generally your payees will understand especially if they only have to wait a few days to be paid. It could improve your relationship with your bank and possibly have a positive bearing on your credit rating.

To find out more about our bookkeeping services, workshops and training, please call Cain & Beer on , or email us at

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