Many businesses will want to be able to use assets such as machinery, vans or a shop which they cannot afford to purchase outright, and so they will need some sort of business finance in order to assist with the use of the asset. The cheapest source of finance is usually your bank. There are two ways to borrow money from a bank, namely by an overdraft or by a fixed-term bank loan.
Setting up a Website
Most businesses these days have a website, and websites can often be bought off-the-shelf and customised quickly so that at least they give a few basic details about your business. If you are setting up a new business, it can be a good idea just to have a simple website with an address which you can add to your business stationery and advertising material. You can always upgrade the website later.
Leaving it late and reasonable excuse
A number of deadlines are coming up. Many companies have 31st March year ends, so small companies from their second year onwards need to submit their accounts by 31st December 2014, and pay corporation tax by 1st January 2015. Income tax returns are due by 31st January 2015, and if these are based upon trading accounts, then those accounts need to have been prepared by the same date.
Paying a Dividend 2
The Equivalent
This is a theme which we are introducing and to which we may return in future articles. On an average day, Sterling is over-valued from the viewpoint of manufacturing industry in the North of England and in Scotland. It is valued just right from the viewpoint of the City of London, and since the City is a good earner of foreign exchange, HM Government goes along with that.
Loan Extension
Greece is asking for a loan extension. What does this actually look like? Let’s say we borrow £100,000 over 25 years at an interest rate of 4% per year and with the intention of repaying a constant amount each year, which is the typical mortgage. The repayments needed can be calculated on an Excel spreadsheet as £6,401.20 per year.
The Battle of Waterloo
It’s time to remind ourselves that Napoleon lost the Battle of Waterloo. He was defeated, in part, by an innovative new tax called income tax, which was introduced as a temporary measure, and intended to be in substance a voluntary levy raised in order to defeat the common enemy.
Non-Corporate Distribution Tax
Politicians love to moralise about how we should all be paying our fair share of taxes. Well, can anyone remember non-corporate distribution tax? This tax:
(1) Never appeared in any manifesto.
(2) Was introduced and repealed within the lifetime of one parliament.
(3) Is rather too complicated for the average MP who voted in favour of it to be able to do even the simplest calculations.
Paying a Dividend
This information is targeted at small owner-managed companies. It is assumed that the owners do not have any children about to go to university, or already at university, for whom a student loan application is needed.
Prepayments and Deferred Income
Let’s suppose that Business A has entered into a maintenance contract with Business B to keep the computers of Business B in working order. The contract was started on 1st November, Business B paid £1,200 cash up front, and both companies have a year end of 31st December.