Wednesday, 23 June 2010
The Budget
Yesterday was the first opportunity for the new coalition government to outline their proposals for government spending, particularly for the current fiscal year, but also in broad principal, for the next three years.
How will these proposals effect individuals and small businesses? For individuals in the higher income bracket; no change at all. Once their total taxable income exceeds £100k in a tax year then they will begin to lose your personal allowances; when their taxable income exceeds £150k in a tax year, then they will be paying income tax at 50% on income above £150k.
For individuals who find that there income within a tax year means that they will be paying tax at basic rate, then there is better news; their personal allowances are going to be increased by £1,000 in April, worth £170 a year.
But there is a cost. VAT is going to rise to 20% in Jan next year, which means that this £170 will soon be clawed back into government coffers. Our shopping bills, private motoring costs, personal and luxury expenditure will all be more expensive by 2.5pence in every £1.
Businesses however, can look forward to more generous proposals; fuelled, no doubt, by the fear of further unemployment and also to encourage profit, which results in more tax. The corporation tax for small companies is going to be reduced from 21% to 20%; and for larger companies, which has a corporate tax rate currently at 28%, the rate is going to be reduced by 1% for each year, for 4 years, until the rate is at 24%.
For all businesses, corporate or not, if they employ people, then the threshold at which they pay employers national insurance will rise each year by the rate of inflation PLUS £21 per week.
What about those who were planning to realise capital assets? It was feared the the CGT rate would return to 40% for non business assets. However, as it turned out, for higher rate taxpayers the rate is increased only to 28% from midnight 22 June, 2010 - still an increase but nowhere near as much as was feared. Even better news though for entrepreneurs relief - the rate of 10% on the first £2m gain will be extended to the first £5m - worth popping the champagne corks for!
So, how is the government going to tackle this huge deficit that it has been telling us about? Well, no changes for the higher earners is one. In fact, with annual inflation - albeit this rate is small - one could argue they are worse off. Also there is the increase in the VAT rate.
The big hits are in public spending. Public sector workers will face a pay freeze for two years for those earning over £21,000 per annum; for those in the public sector earning less than £21k per annum, they will get a flat pay rise worth £250 for both years. In addition; education spending in England is facing up to a 25% cut. There are also hits on; child benefits, housing benefits, tax credits, other benefits effecting lone parents. The total cuts to welfare will result in an expected saving by 2015/16 amounting to £11bn.
My final thoughts? Well, we were all bracing ourselves for high increases in taxation and in the end these didn't materialise. But beware of the effect of the cuts in public spending. When preparing for your personal and business budgets for the next two years - build in a factor for a drop in demand as a result of your customers having less disposable income.
Like me, I sure that you are glad that the budget is over - at least for the moment. Should we lose sleep? probably not - just make sure that YOU budget and ALWAYS prepare up to date and robust plans
Tuesday, 11 May 2010
TODAY with TONY DOWN
Excellent numbers attended the financial and business planning courses this week - very positvie feedbacks. Further courses that we are running very shortly, include; SAGE accounts, Quickbooks, and general book keeping. Budgeting methods and skills will be included in all the courses.
All course are led by Tony Down FCCA, a Chartered Certified Accountant and experienced presenter. Contact a member of his team on + 44 (0) 08450 347343 or email tony@gordon-down.co.uk
Financial Management
Many businesses today are still unaware of their overall financial situation. Apart from being able to easily access their bank account balance from over the telephone, internet, or cash point machine, all the other important information such as; total sales, breakdown of costs, profit and working capital remain a mystery until accounts are prepared nine months or so after the year end. Too late for being able to make management decisions; their only use is for the tax authorities for which, in reality, was the only reason the accounts were prepared.
It is little wonder then that businesses are still struggling and that the rate of business closure remains very high.
Tony Down and his team seek to support and encourage businesses by providing and explaining the financial information, thereby empowering business owners and their management teams to take business decisions based on accurate information.
Whether your business is based in the UK or in another Country; to find out how Tony and his team can add value to your business, please contact him on +44 (0) 08450 347343 or email tony@gordon-down.co.uk
Tony is a Chartered Certified Accountant and Business Advisor. He is also an experienced presenter where he regularly provides seminars on subjects including, financial and business planning, financial monitoring and financial control.
Wednesday, 21 April 2010
SEMINAR by TONY DOWN
Today, and through to the 6th May; the electorate here in the UK are being asked to make choices. Depending on what their choices are, and more importantly, their choice on the 6th May, this will determine who will govern Britain for the next four years or so.
So making the right choices are important, not just politically, but certainly in business aswell. Business is limited in the amount of resources that are available to them (economists call this 'Scarce Resources'). Whether the resource is money, people, or, capital equipment - the amount available is limited; so, we have to make choices from time to time.
This week I have been continuing to advise a business who wants to carry out a new project, but for a long time, this project has remained as just an idea in the directors minds - no progress has ever been made. I have helped the company put a 'Route Map' together whereby they can identify where they are now, then how they are going to achieve a successful outcome to the project - This is called; 'Strategy'.
Basically it's about planning. Making the most effective and efficient use of the limited resources available to them - Making right choices. Taking a wide panoramic view of the business and economic evironment and then breaking the picture down into detail.
Finally, Thursday and Friday I presented the second of this months business seminars. One of the delegates who attended is an Illustrator and Animator; at the end of the course he came up to me and said, 'Thanks Tony, the last two days have been really helpful', then he handed me a cartoon of myself presenting the seminar - I shall treasure this so much; there are some things that just cannot be measured in monetary terms.
Management and use of resources in business is important - It's not just about money, other resources are just as important too. For details of my seminar "IT'S NOT JUST THE COST, IT'S THE INVESTMENT THAT COUNTS", contact me at +44 (0) 08450 347343 or email me at: tony@gordon-down.co.uk
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