Spring Statement Analysis & 2019 / 2020 Tax Facts

Once again, Chancellor Philip Hammond has demonstrated his commitment to the principle of the Spring Statement as a low-key event, at least in terms of tax and public spending announcements.

With none of the pomp and circumstance of the Autumn Budget, Hammond stuck in large part to summarising key points from the updated economic forecast from the Office for Budget Responsibility (OBR). Though he presented the numbers with a flourish, the OBR was mildly pessimistic in its own presentation, especially around a reduced estimate for growth in 2019, down from 1.6% to 1.2%.

Corporate Challenge

This year is the Hospice`s 35th Anniversary! Pierce have therefore decided to take part in the East Lancashire Hospice Corporate Challenge 2019. The hospice is hoping to get 35 Companies on board to help raise as much money as possible. The headline sponsor of the event provides a Business with £50 to start the fundraising.  The challenge is over a four month period June to September , we will be organising numerous events over this period.

A few of the Events planned so far :

  • National Three Peaks
  • Race Night
  • Football Tournament
  • Cycle Liverpool Leeds canal
  • Murder Mystery Evening
  • Fashion Show

View our events page for further event details.

We will be holding an auction/raffles at some events  and would be extremely grateful if any of you could donate a raffle prize.

The hospice is close to many hearts at Pierce, over the years the hospice has supported many friends and family.

Let`s get fundraising !

JustGiving - Sponsor me now!

Lancashire businesses prepare for further changes to National Minimum Wage within the care sector following U-turn decision

National Minimum Wage (NMW) has been a key focus for the government for some time now and they have been pursuing sectors they believe do not comply with legislation.

Historically in the care sector, many employers paid a fixed amount to cover any overnight sleep-ins with an additional hourly rate paid for hours the employees was needed.

Two court cases – Mencap v Tomlinson-Blake and Shannon v Rampersad – argued that most care workers on overnight shifts are constantly on call, therefore the employee should receive NMW for the entirety of the shift.

In October 2017, the government introduced a new compliance scheme for the care sector, allowing employers within this sector to review their pay arrangements in line with the above and pay any monies that may be due to employees without being publicly named and shamed.

Both cases have since gone to the Court of Appeal and the decision made a complete U-turn to not count sleep-in shifts as working time, the only time that counts towards national minimum wage is when the worker is required to be awake for working. However, if suitable sleeping facilities are not provided then minimum wage must be paid for the entire shift.

Therefore, the rulings have reverted back to how most employers treated the arrangements in the first instance.  HMRC have now updated their guidance to reflect the latest rulings.

Andrea Bridgehouse, owner of My Life-My Choice in Oswaldtwistle which supports children and young adults with disabilities and complex needs, said: “These rulings have sent shockwaves of confusion through many sectors that use night workers, but they set an especially dangerous precedent in the vital care sector.

“Providing quality care is complex and costly enough as it is and the changes could cost our business in excess of £80,000. This would take us to the brink and it’s no exaggeration to say that it seriously threatens our future.

“We’re the only service provider in the area that is set up to deal with these complex issues and if we had to close then it would lead to 176 young people and their families being stripped of the support they depend on, 44 carers out of a job and it would signal the end of a business I have spent 18 years building.

“Due to the previous changes, I now pay my staff £85 a night and will continue to do so, if I make a U-turn and revert to the old rate then my staff will lose pay and leave.”

Lisa Kennery, payroll manager at Pierce, said: “The changes will certainly bring a headache to businesses, particularly in the care sector. Depending on how a business has been calculating pay for sleep-in shifts historically will determine how it will impact a business both financially and operational.

“Businesses like My Life-My Choice will have already changed their rates and paid the higher amount, costing the business thousands of pounds.”

For further information on how these changes may affect your business, please call Lisa Kennery Pierce on 01254 688 100 or visit www.pierce.co.uk

 

Budget boost for business investment

With the Budget 2018 announced just a few days before Halloween, there was much speculation about whether the Chancellor’s famous red Budget Box would be full of tricks or treats. As the last Budget before Brexit, it was highly anticipated by both business owners and individuals.

During Pierce’s annual Budget Breakfast event, which welcomes business leaders and clients from across Lancashire, Chairman John Green described Philip Hammond’s latest announcement as ‘the most small business friendly budget ever’ which had ‘enterprise at the heart.’

For me, the most welcomed announcement was the Chancellor’s helping hand to kick start business investment by increasing the Annual Investment Allowance (AIA) from £200,000 to £1m. The increment provides opportunities for businesses to gain significant tax relief when they invest in plant or machinery.

During his speech, Hammond said the aim of the increase was to ‘stimulate business investment’ and it is a strategic move to help boost business confidence during uncertain times as Brexit creeps even closer.

In my experience, since the AIA was introduced a decade ago back in 2008, it has encouraged business owners to move forward investment plans and I’m sure that this announcement will encourage even further growth.

With the increased amount available from 1 January 2019 – 31 December 2020, I would urge businesses to look at their investment ambitions and maximise on this opportunity while they can.

The timing of the investment is critical, the expenditure must be incurred at the correct time and in accordance with the rules. Your accounting period end will influence the ideal timing.

Available to an individual, partnership or company carrying on a trade, profession or vocation, a UK non-residential property business or a furnished holiday let, the AIA covers plant and machinery, vans, lorries, equipment, building fixtures and computers.

For a full breakdown of the Budget 2018, visit our website. For more information about how your business can drive investment forward with the help of the AIA, call Mark Walmsley on 01254 688 100 or email  m.walmsley@pierce.co.uk

UK Income Tax Liabilities regarding Offshore Matters

New legislation has introduced a legal requirement for UK taxpayers who have undisclosed UK tax liabilities to income tax, capital gains tax and inheritance tax in respect of offshore matters to disclose the relevant information to HMRC by 30 September 2018.  This is known as the Requirement to Correct (RTC).

The penalties for failure to correct (FTC) start at 200% mitigated to a minimum of 100% of the tax.  There can also be asset-based penalties in more serious cases.

With effect from 1 October 2018, the Common Reporting Standard will be introduced under which 100 jurisdictions will exchange financial account information on residents’ investments offshore hence the need to report any undisclosed liabilities by the 30 September 2018.

When the legislation was first drafted it was thought it was intended to target deliberate tax evasion, such as routing undeclared UK income through off shore structures. However over the course of the last few months it has become clear that HMRC will be taking a more aggressive approach even in cases where an innocent error has occured.

In brief, a person must correct any offshore tax non-compliance, including failure to notify chargeability to tax or failure to submit a Return that should have been submitted.

The RTC covers tax years as far back as 2013/14 if a failure has occurred but the taxpayer has taken reasonable care, back to 2011/12 if behaviour was careless and back to 1997/98 if the behaviour is deliberate.

If you have any assets overseas, for example holiday homes, letting income, bank interest, then Pierce can help you prepare for the new legislation.

For further information, please contact Anne Wilson on a.wilson@pierce.co.uk or call 01254 688 100.

Awards success for Pierce

Accountancy firm Pierce is celebrating after its employees and clients achieved award success at Lancashire Business View’s Sub 36 awards and the BIBAs.

Payroll assistant Layton Smalley has been shortlisted for the Apprenticeship Award at the Sub 36 awards. Layton, 19, recently completed his 18-month apprenticeship at the firm before being promoted to his current role.

Layton was nominated for playing a key role in the payroll team, providing vital administration support for the department, as well as assisting other team members with processing payroll and dealing with client queries.

Pierce’s client, English shoe company, LANX had a hattrick of shortlistings for

the New Business Award and the Innovator Award and Entrepreneur of the Year Award for its owner Marco Vaghetti.

Continuing the success, last week client Flavour Warehouse won two BIBAs after being named Manufacturer of the Year and Exporter of the Year.

Lisa Kennery, Payroll Manager at Pierce, said: “We’re delighted that Layton has been shortlisted for the Apprenticeship Award. He is so committed to his job and works really hard so he truly deserves the recognition.

“We’re really proud of our client’s achievements too, both LANX and Flavour Warehouse are really innovative businesses.”

The Sub 36 awards will be held on Thursday October 18 at the Winter Gardens, Blackpool.

For more information about Pierce, please visit www.pierce.co.uk or call 01254 688 100.

Pierce’s payroll manager shortlisted as biggest influencer

Pierce is celebrating after their payroll manager, Lisa Kennery has been shortlisted for a prestigious industry award.

Lisa has made the final eight for the biggest influencer category at the Chartered Institute of Payroll Professionals Annual Excellence Awards.

Lisa was nominated by Pierce’s payroll assistant manager Philip Johnson, after receiving unrivalled support from Lisa during his career at Pierce.

Philip said: “Lisa has not only played a key role in enhancing my knowledge needed for my professional qualifications but also in gaining the softer skills needed to develop my career. Since being at Pierce I have worked my way up from being an apprentice to assistant manager which is all thanks to the support, guidance and encouragement from Lisa.”

Lisa added: “It was such a shock to find out that I have been shortlisted for this award. It’s a great achievement and I’m thrilled that Phil nominated me.”

The 2018 Annual Excellence Awards will be taking place in Birmingham on Thursday October 11.

Luxury hotel appoints Pierce to support growth

Lancashire-based luxury hotel Stirk House has appointed Pierce to support its ambitious growth plans with expert business advisory and accountancy services.

Stirk House, a listed building which overlooks the Ribble Valley, has experienced significant growth in the past three years, increasing turnover from £1.4m to £2.4 million by branching out from guest stays and becoming a popular wedding venue.

The family run Clitheroe hotel has enlisted the services of Blackburn-based accountants, Pierce to provide auditing, tax planning and advice on access to finance.

Helen Kay, financial director at Stirk House, said: “In the last few years we have developed our core hotel business by taking a more pro-active customer approach and investing £750,000 into the building to offer bespoke wedding packages at an affordable price. This has helped us to increase the number of weddings we host per year from 18 to 180.

“Pierce is not only a dependable, expert partner – the team is pro-active, friendly and approachable which made them a great fit. With their help, we will be able to implement our business plans, get everything in place financially and grow the business further.

“Our future plans include investing into the leisure club and spa facilities and increasing the number of bedrooms.”

Nadeem Hussain, director at Pierce, said: “Stirk House is an iconic local hotel and a much loved heritage building – but at its heart lies a thriving, modern business with exciting plans.

“We will work closely with Helen and the management team at Stirk House to build on the incredible successes of the past three years, by underpinning their excellent business ideas with strategic business, accountancy and funding plans.

“We look forward to helping the business during this exciting next phase.”

For more information about the expert financial services offered by Pierce, please contact them on 01254 688 100 or visit www.pierce.co.uk.