Postage rates have increased to 76p for a basic first class letter and 65p for second class. Large letters and letters over 100 gram are also more expensive to post.
The current income tax year ends on 5 April 2020, which is also Palm Sunday this year. Small companies should consider setting up a payroll scheme to pay their directors a salary to cover their Personal Allowance, if they have not done so already, before this deadline. The time to act is now, so see an accountant!
The new Christmas Stamps will be issued today and can be purchased online from the Royal Mail. I will be buying the 1st and 2nd class stamps for most of my Christmas cards, but the higher value stamps are rather small and I will be using other nice commemorative stamps for my airmail cards. All my cards will have a “Merry Christmas” sticker on the back purchased from Amazon.
Small private companies with a year end of 31 January 2019 and into their second or later year of existence should submit their accounts to Companies House by Thursday 31 October 2019 in order to avoid a Late Filing Penalty.
It is quite common to invoice a customer with terms of “30 days or nett monthly account”. Small customers will be expected to pay within 30 days, while large customers will be expected to pay at the end of the month following the month of the invoice, so an invoice sent in August 2019 would be settled by Monday 30 September 2019. Obviously, the average settlement time will be 45 days, but this is OK if the customer’s credit is good.
Large companies insist on doing it this way because they may receive several invoices from a supplier during a month, and will want to settle all of them with a single payment when they do their monthly computerised cheque run. It would therefore be a good idea for the supplier to have sent a statement at the start of September listing all outstanding invoices. Typically the cheque run would be about the 25th of the month, which is today.
If you give credit and have debts to collect, then you might like to have a discussion with us. Most accountants are also general business advisers as well. Some large companies rely upon a cynical calculus of bargaining power when they take ages to settle invoices, and you need to know what to do about this.
The “nett” in “nett monthly account” has “net” as an alternative spelling.
We are keen on the use of optical character recognition, so we are now making our outgoing mail OCR-friendly. The standard font which we will use for addresses is 12 point Lucida Sans, which is based upon reading the Royal Mail User Guide for Machine Readable Letters. We will increase the spacing by 20% in the vertical direction to make it easier for humans to read the address as well.
Lucida Sans comes in two versions. Where outgoing mails are critical, we will use Lucida Sans Typewriter which is a monospace font which OCR scanners find easier to deal with. Letters to Companies House and the Revenue will use this font. We keep a small stock of pre-addressed C5 envelopes for all the main departments. Where letters are sent to vague “Somewhere in Cumbernauld” postcodes like BX9 1AS, we want to be sure that the postcode is processed correctly.
Where outgoing mails are not critical, we will use Lucida Sans in its proportionally-spaced version. This is more pleasing to the human eye but ever so slightly less OCR-friendly. Direct mailings will use this font.
I have a client who was supposed to submit accounts by tomorrow’s deadline of March 29th, but hasn’t actually done anything yet. I have agreed with Companies House and the Revenue a two-week extension until Friday April 12th. However, the client still hasn’t done anything and I am not expecting much to happen.
I ask you, dear reader, should I tell this client to look for another accountant? Perhaps our MPs could advise.
The cost of a basic 2nd class stamp increases to 61p and a basic 1st class stamp increases to 70p, with matching rises for large letters and items over 100 grams. The rise in the second class stamp price is in breach of Ofcom’s guidelines this side of April 1st, which only allows 60p, so the Post Office will give its expected superprofits to charity. The average rise is by 4.8% measured over one 2nd and one 1st class stamp taken together.
We keep about six months’ supply of basic NVI stamps plus a few stamps in the range between 1p and 20p, so we are a little inflation-proofed until September at least. Higher value stampings are made up of a mixture of lower values. NVI means “non value indicator” and NVI stamps are worth their current price when used in combinations, so their apparent value rises automatically today. As an example, the new cost of a large second class letter weighing 200 grams has risen from 1.26 to 1.32, for which we use exactly the same combination of stamps, namely one 1p stamp, one 2nd class and one 1st class.
Postage rates rise on Monday March 25th 2019, so you might like to buy in a stock of stamps of the “non value indicator” type which will hold their relative value. We have done it already by ordering online from https://shop.royalmail.com/ which is currently offering free delivery on orders over £50.
It costs nothing extra to order a great variety of colourful stamps. We advocate that every business does a little bit of direct mailing, for example in its slack season. Our standard stamp for direct mailing is the grey-green second class “English country definitive” with the three lions. This is an attractive-looking stamp and it does not scream “second class” at the recipient. The same can be said of the nice blue second class Scottish country definitive.
For the other mail we send out, we use a variety of nice stamps and commemoratives and we can order in early March in order to stock up. We often get our own envelopes handed back to us with signed documents in them, so we cut off the used stamps and give them to charity. Everybody wins.
Most of the printed matter we get is standard three-column A4-size bank statements for which we use Optical Character Recognition (OCR) on a flatbed scanner. We get the occasional credit card statement without any running total, and our own bank statements, which we receive once a month, happen to be in A5 format.
We could scan A5 format by rotating it before and after scanning, but this is quite a bit of faffing about. What we will do instead for both credit card statements and unusual bank statements is to scan them using an OCR pen scanner. Every February we will look on Amazon for the most recommended pen scanner, and try it out if it is different from last year. This year we have purchased a “Scanmarker” pen and it looks as if it will be able to do something useful. We will adapt our software to work with it.
Credit card statements and unusual bank statements we will collectively call “Irregular Printed Matter”. We don’t see that much of it, but it is nice to have a policy for dealing with it. At least we give the clerk more toys to play with, which takes the boredom out of accountancy.