in focus turn your business strategies into reality
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issue nine: Summer 2016
Profit or Perish
How can you be one of the post-Brexit winners?
Howzat for sponsorship!
ATOL Auditing success
business advice
accountancy & audit
Limited benefits for Directors tax advice
Will UK be frozen out of Europe?
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welcome
in this issue welcome to issue nine Well, there’s no way I can get away without mentioning the EU Referendum vote result, which for some was welcome and for some very much the opposite. Whichever way you voted, we now all have to move forward in a positive fashion, partly to avoid talking ourselves into another recession and partly to show that we have faith in ourselves, our businesses and our country. There’s going to be an avalanche of discussion and speculation in the coming weeks - possibly months, or even years, depending on how long the exit negotiations take. Whatever else happens, we know there will be plenty of changes, in tax rules and regulations, payroll and employment law, etc. to keep track of and to keep us all on our toes - so, best foot forward! Planning for every eventuality may be the key to survival - or growth, as there will always be winners, whatever the situation.
In this issue:
03 Quiz Results 04 Staff News 06 - 09 Business News and Advice Profit or Perish - how will Brexit affect your business? NEW Profit Improvement Workshop; Brexit and Corporate Finance; Financial Reporting Changes
10 - 12 Tax News
Company owners to pay more personal tax on dividends;The Construction Industry Scheme; The tax implications of leaving Europe
13 Audit News
Russel Byrd becomes Gloucestershire’s first ATOL registered auditor
14 Payroll News
The moving feast that is Payroll Compliance
15 - 16 Academies Update
Academies accounts direction 2015-16; Condition Improvement Fund 2016-17
17 Randall & Payne in the Community
Busking for Gloucestershire Young Carers; Cricket sponsorship; Nelson Trust Clock
18 Dates for the Diary
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19 Tax Reference
Tim Watkins, Managing Partner
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www.randall-payne.co.uk
contents The newly restored Nelson Trust clock, above the Hub Bistro
business advice accountancy & audit tax advice wealth management financing business startups valuations buyouts debt factoring
Coffee at the Hub Bistro
Making coffee at the Hub Bistro
The winners (and Steve Knibbs) with their champers
Enjoying the clock now it’s working again
Quiz is a Double Success! 30 teams entered our annual quiz, held jointly with WSP Solicitors at Marling School. This year the proceeds, over ÂŁ2000, are to be split 50:50 between Gloucestershire Young Carers and the Pied Piper. The quiz, hosted again by Steve Knibbs from the BBC, was hotly contested and eventually won by our own Randall & Payne Team, who each walked away with a bottle of Mumm Champagne. Well done to (left to right) Adrian Stokes, Lawrence Landray, (Steve Knibbs, our quiz master is in the centre), Andrew Sweet and Ed Price and thanks to everybody who took part, helping to raise such a great total! if
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R&P update
news focus turn your business strategies into reality
your guide to what’s new in the world of business...
Staff News Exam Success
Congratulations to Dani Longney and Gina Gardner for completing their AAT Level 4 Diploma in Business Skills qualifications! This fantastic achievement complements their full AAT Memberships. One more certificate will complete their Higher Apprenticeships. Well done both!
Dani Longney
John Gaze looks forward to retirement
Mel Scotford celebrates 25 years with R&P
Having been a real asset and valued member of our tax team since joining us as Tax Manager in June 2008 from HMRC, John Gaze has now set his sights on retirement and left R&P in June to embark on this new adventure.
While many will find it hard to believe, given her youthful looks, Mel has worked as a Randall & Payne secretary for 25 years! We couldn’t let a milestone like that go unrecognised, so Tim Watkins presented her with gifts and a bouquet and we all raised a glass to her next 25 years.
Thankfully John has generously shared his knowledge and experience of HMRC and how best to deal with them with the other members of the team, but his humour and down to earth attitude will be greatly missed in the office. Commenting on John’s departure, Tim Watkins spoke for the whole office, saying: “John was a very valuable member of our Tax Team, a colleague and a friend. We will all miss him, especially everyone in the Tax Team where we have had John Gaze the benefit of his wide knowledge and wise words. On behalf of all of us at Randall & Payne, we wish John well for a long and very happy retirement”
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Mel said: “I have enjoyed working for Randall & Payne and can honestly say that it doesn’t feel like 25 years. There has been many changes during this time, with colleagues retiring or moving on and the move to a one office and I am pleased to still be part of the team and was overwhelmed with the celebration they gave me”
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Oh to get this kind of reception every day!
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staff news
Gina is Officially Outstanding! Huge congratulations to Gina Gardner, awarded the ‘Apprentice of the Year, Financial and Business Services’ at the 2016 Apprenticeship Awards. Gina, who was part of a shortlist of four, was joined by her family and R&P staff at the glitzy event, held at The Centaur, Cheltenham Racecourse on 7th July. The evening was expertly compèred by the BBC’s Steve Knibbs and was an impressive showcase of emerging Gloucestershire business talent, with none more deserving of her award than our Gina, just one of our highly talented apprentices. Well done Gina, we are proud to have you in our team. Higher apprenticeships are work-based learning programmes, covering over 40 different subjects, that lead to a nationally recognised qualification. Apprentices benefit from the chance to gain professional accreditation and membership and a unique, new way of developing professional-level, job specific skills while remaining in employment and earning a salary, without student loan debt. Apprentices also benefit from new opportunities for career progression and a clear pathway to achieving their ambitions in the workplace. This is great for employees and employers alike and employers, as R&P have known for some time, benefit from motivated employees who understand the company and its ethos. Apprentices are the key to the continued growth of Gloucestershire’s Business community and R&P recruit regularly via our website.
Richard Gray joins R&P’s Business Advisory Team R&P prides itself on having a strong and innovative business advisory offering. Our commitment to this service moving forwards is demonstrated by our investment in skills, in particular the recruitment of Business Growth Advisor Richard Gray an expert in both sales and growth strategies: “My role at Randall & Payne is to support the business advisory team from a background in developing both sales and growth strategies by working with clients and understanding their business’ needs. Supporting businesses with that allows us to give a really potent offering to our clients that they wouldn’t necessarily expect from their accountants. “Will Abbott was one of the high growth coaches when I was delivering the Growth Accelerator programme for Gloucestershire and it was clear that Randall & Payne were developing a
really powerful business advisory service that was like no other locally, so by joining Randall & Payne I can help develop a service that is absolutely unique to the market to deliver really fantastic results. Building on the chartered accountancy side, we can work with a business, show them where they are now, find out where they want to be in a year’s time and use our skills and expertise to help them get there.” Richard Gray
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business advice
Profit or Perish: The falling pound means that imports will be more expensive. This has already had an impact on fuel prices and is likely to have a huge impact on manufacturers importing components and materials, so businesses may have to choose between cutting profits or passing the cost onto consumers. Finance may be less easily available. While the leave campaign promised that lost EU funding would be maintained by the UK Government, in the short term at least, there could be a drop in available funding. The uncertainty in the economy more broadly is likely to reduce the availability of investment as financiers become more cautious in the short term. Randall & Payne can help you look at alternative financing options and utilise forecasting and audits to ensure any application for finance is as strong as possible.
Randall & Payne Quorum allows business leaders to connect and share strategies for growth while gaining skills and tools to implement them. For a small investment you not only get a sounding board for your ideas, but real training and the knowledge that you can see and measure your progress regularly.
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• Online Tools • Remote Business Support • Accounting For Business • Workshop for Business Leaders • Minimising Tax • Making the most of your wealth
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business advice
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How will Brexit affect your business? The results of the recent EU referendum have created a lot of uncertainty for businesses, in particular exporters and SMEs. There are a number of immediate impacts which need to be considered, says Will Abbot Immigration was arguably the deciding factor for many voters and, while changes to free movement across Europe are unlikely to come into effect for a number of months or even years, at some point there will be an impact that businesses relying on EU workers must be prepared for. The IT and STEM skills gaps are likely to become more severe, so businesses relying on these skills need to be prepared to face issues with recruitment as well as staff retention. There are innumerable other ways that Brexit could affect your business so it’s essential to assess the immediate impact on your business and create a strategy that both counters the short term impacts and prepares for the long term. Leaving the EU may create tremendous opportunities for your business, or you may need to implement contingencies immediately to keep your business moving forwards.
The businesses that survive Brexit will be the ones that seek expert guidance in navigating what may seem like a rapidly changing business landscape. By taking advantage of Randall & Payne’s experienced business advisory team, you can find the opportunities and minimise any difficulties, brought on by this transformation of British relations with Europe. Randall & Payne has been providing business advisory services for decades, seeing clients across all industries through many changes in the business landscape. However your business is being affected by the vote to leave the EU, we can help you develop strategies to carry you through this period of uncertainty.
For more business advice see our website www.randall-payne.co.uk or call our Business Advisory team on 01242 776000 if
WILL ABBOTT, Partner LLB FCA AMSF MInstLM Will leads our team of business experts and helps clients to take a step back from their business in order to see it clearly: its strengths and weaknesses, its goals and what needs to be done in order to reach them: “By working with business owners we can drive improvement and growth which ultimately leads to increased value and greater choice.”
Need help to turn your business strategy into reality? Our next Quorum Meetings will be held on Sept 13th and Nov 29th. To book a place, contact Jo Kline or Will Abbott on 01242 776000 Summer 2016 Summer 2016
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Brexit and Corporate Finance
Ollie Newbold
I suspect Brexit linked with any business topic will become a very well-trodden path over the coming months. However, it would be remiss not to consider the impact from a Corporate Finance angle, especially when transactions of this nature are often linked with a strong economy and robust business confidence levels. We have already seen markets react sharply to the news of an exit from the EU and I have witnessed first-hand the doubt that such a result can provide. I had a phone call first thing on Friday 24th June saying “with what has gone on, is now the time to commit to an acquisition?” – this was from the MD of a successful Gloucestershire based company looking to make a sizeable strategic acquisition. As part of our free ‘Improve – Invest – Grow – Exit’ seminars we talk about having a clear strategy for any acquisition and making sure that the focus is on ensuring that the acquisition meets that strategy. So with this in mind my view is the following questions should be considered: 1. Has my strategy for the acquisition changed as a result of Brexit? 2. Does the target still meet my acquisition strategy? 3. Are there any implications for funding as a result of Brexit?
In most circumstances, nothing will have really changed for points 1 and 2 and, having spoken to various banks since the news broke, the suggestion is that this possibility was built into their models so there should be no immediate change in lending appetite or credit policy. Notably, these questions are just as relevant on the sell side of a transaction – you simply need to put yourself in the place of the buyer and be prepared to have your advisers at the ready to explain why nothing has really changed for them. To succinctly sum up (in a heavily abridged version of Rudyard Kipling’s ‘If’): ‘If you can keep your head when all about you are losing theirs, you’ll be a business expert, my son’.
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For help from our Corporate Finance Team, contact us on 01242 776000 or visit our website. 8
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business news
Changes In Financial Reporting Which Affect You The Financial Reporting Council (FRC) have revised Financial Reporting Standards in the United Kingdom and Republic of Ireland, replacing all the current standards with five new Financial Reporting Standards of which only two are likely to affect small businesses, you need to decide which of these 2 reporting standards would work better for your business to ensure the information on record is comprehensive and sufficient to assist you in your future plans.
Our Corporate Finance team have spoken with local lenders and finance companies who have stressed that the information provided in FRS105 (the reduced disclosure standard for the smallest entities) could potentially reduce the balance sheet value of businesses and create issues when raising finance or potentially exiting your business. With this in mind this fact sheet is to illustrate the importance this decision could have on your business.
FRS105 Micro-entities regime Qualifying criteria: Turnover < £632,000 Balance sheet <£316,000 Average number of employees 10 or less.
FRS102 Section 1a Small company regime Qualifying criteria: Turnover <£6,500,000 Balance Sheet <£6,500,000 Average number of employees <50
This flow diagram should help you make your decision but in summary if you are not expecting business growth, nor looking to sell or seeking financial investment in the future then the Micro Entities regime may suit. If however you are looking to grow the business, obtain future investment or finance, or sell for the full market value the FRS102 is likely to be more appropriate.
For more information contact our Accounts team on 01242 776000 or visit www. randall-payne.co.uk
Which standard best suits us? FRS105 or FRS102
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No
Do I meet the criteria set out above?
Yes
FRS105
Are you planning to grow the business or will we need our financial reports to obtain business valuations in the future?
Yes
No
FRS102
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tax news
Company Owners To Pay More Personal Tax On Dividends Changes from the 2015 Summer Budget, which came into effect in April 2016, will find most company owners paying more personal tax. Trish Clements explains:
For those who have been paying themselves a low salary and making the difference up with dividends, this may no longer be the best solution as Dividend Tax, which replaces the previous dividend credit system, greatly increases the tax paid on dividends. This new tax operates in a similar way to income tax, affecting dividends in excess of £5000 a year, so it’s important to speak to your accountants now to ensure you’re dividing your income between salary and dividends efficiently. Dividend tax credits have been abolished and replaced with a band system taxing dividends over £5000 at 7.5% for basic rate tax payers, 32.5% for higher rate tax payers and 37.5% for those on the additional rate. It is expected to raise £2.54bn during 2016/17. If your dividend income is less than £5000 you will have no extra to pay, however, if you are receiving dividend income from a trust, you won’t get the dividend allowance. From April 2016 the tax thresholds are: • Personal Allowance: £11,000 • Basic Rate Limit: £32,000 • Higher Rate Threshold: £43,000
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Example: “I have a non-dividend income of £18,000, and receive dividends of £22,000 outside of an ISA” Of the £18,000 non-dividend income: • £11,000 is covered by the Personal Allowance • the remaining £7,000 to be taxed at Basic Rate Of the £22,000 dividend income: • the Dividend Allowance covers the first £5,000 • the remaining £17,000 of dividends to be taxed at the Basic Rate (7.5%)
These changes greatly reduce the tax benefits associated with incorporating, so businesses considering incorporation may wish to discuss the impact of the new tax before moving forward. Alternatively, it may be worth considering whether being incorporated is still the most tax efficient structure. Randall & Payne can assess the impact that this new tax will have on your finances and help ensure you’re paying the correct amount of tax by using dividends efficiently.
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Contact our tax team today on 01242 776000 to find out how we could save you money on your tax bill.
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tax news
Construction Industry Scheme News Senior Accountant, Alex Rolfe gives a brief overview of the Construction Industry Scheme and the changes introduced earlier this year. The Construction Industry Scheme (CIS) covers most construction work and related activities carried out in the UK. The full list of activities covered can be found in the government’s CIS340 booklet on www.gov.uk. Businesses involved in the construction industry are known as ‘contractors’ and ‘subcontractors’ and may be companies, partnerships or self employed individuals. For the purposes of the CIS, construction companies, building firms and also government departments, local authorities or any other business spending more than £1 million a year on construction is classed as a contractor and must be registered as such with HMRC. Subcontractors are those businesses that carry out work for contractors. Many businesses act as both contractors and subcontractors. Before engaging a sub-contractor it is extremely important for the contractor to determine if the subcontractor should be an employee, as contractors may be liable for under declared PAYE & NI if wrong. It is the terms of each particular engagement that decide the employment status, with deciding factors based on right of control; substitution; who provides materials and equipment; paid for absences; business risk and who is responsible for error correction. HMRC has a web-based employment status indicator tool to help but the results may favour being classified as an employee (HMRC’s preferred outcome). It can be worth seeking advice if you have any concerns. Before a contractor can pay a subcontractor for construction work, they need to verify with HMRC that the subcontractor is registered and HMRC needs to confirm the rate of deduction that must be applied to payments, or whether the payment can be made without any deductions for the first time or if they have not been used in the previous two tax years.
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New subcontractors must be verified through HMRC and from 6th April 2017 online verification will become mandatory. From 6th April this year: • online filing of CIS returns became mandatory, with the offer of alternative filing arrangements for those unable to access an online channel by reason of age, disability, remote location or religious objection. Contractors must make a monthly return to HMRC on 19th of each month to: • confirm that the employment status of subcontractors has been considered; • confirm that the verification process has been dealt with correctly; • detail payments made to all subcontractors; • detail tax deductions made; • or confirm no payments made Subcontractors can apply for gross payment status if they have filed all returns, made payments on time and turnover is at least £30K for each owner/director of the business (or at least £100,000 for the whole Partnership or Company). The whole CIS system is backed up by a series of penalties, covering incorrect monthly returns (negligent or fraudulent); failure to provide CIS records for HMRC to inspect, incorrect declarations about employment status and late returns with penalties escalating over time. if
If you have any queries regarding the CIS, contact Alex Rolfe on 01242 776000 or at alex.rolfe@randall-payne.co.uk Summer 2016
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tax news
The Tax Implications of Leaving Europe A number of major policy consultations were put on ice during the referendum campaign and the result may mean many of these are never released. The ‘Making Tax Digital’ consultations, which were expected to emerge in the immediate aftermath of a remain vote, could now be put on hold.
Hot on the heels of Referendum Outcome Speculation, comes new speculation about how we will separate form Europe and, as importantly, who will lead the negotiations, with no visible long-term plan in place.
VAT MOSS will continue to apply to UK businesses selling digital services into EU, but UK businesses will be on a non-EU basis, so the operation of VAT-MOSS is likely to be more difficult.
The 2016 Finance Bill is already running behind schedule and may not get passed as planned in early October.
The tour operators margin scheme (TOMS) is also likely to be harder for UK businesses to operate, in determining the place of the supply (i.e. where the tax is accepted for).
The illustrative ‘leave’ budget, produced by George Osborne and Alistair Darling during the referendum campaign, anticipated £15bn of tax rises and £15bn spending cuts, which would most likely crack the triple tax lock, with rises in Income Tax and National Insurance. Corporation Tax is likely to remain the same in order to tempt companies to stay in the UK. In the short to medium term, tax and regulations tied to European law, for example VAT, won’t change. VAT has proven, worldwide, to be one of the most efficient taxes, collecting £115bn a year for the UK government. As it is a relatively easy change to implement, there’s a chance the VAT rate could go up, although, without the need to refer to CJEU, the UK may extend the scope of zero rating and exemptions from VAT. Intrastat returns could no longer apply post-exit, as sales to and from EU countries will be exports and imports, rather than intra-EU movements and VAT on expenses incurred in EU countries may become more difficult to recover.
The UK has had a number of disagreements with the EU over the scope and operation of UK taxes, including patent box, changes to the taxation of controlled foreign companies, differential rates of insurance premium tax, etc. Once the UK ceases to be a member of the EU, both the tax rates and the structure of the tax system will be determined according to the needs of the parliaments in Westminster, Holyrood and Stormont, subject to the terms of the UK’s settlement with Europe. Finally, once the UK achieves exit, European approval will no longer be needed in respect of state aid on tax incentives such as R&D tax credits, the patent box, and executive investment schemes (EIS & SEIS), so we may, see more tax incentives introduced to encourage businesses to invest here.
ROB CASE Partner BA (Hons) FCA CTA AIIT Rob is a VAT specialist.
“I seek to provide a sound interpretation of peoples’ VAT situation, taking an informative approach to what is often seen as an unpopular and overcomplicated tax.”
For more information call Rob on: 01242 776000 12
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www.randall-payne.co.uk
audit news
Russel Byrd’s flying high with full ATOL Audit accreditation! R&P Partner Russel Byrd has completed the training required to become a registered ATOL Auditor, the first accountant in Gloucestershire to have done so, adding to Randall & Payne’s list of specialist sectors.
Russel Byrd, Head of Audit & Assurance at R&P, has completed the training required to become a registered ATOL Auditor, adding to Randall & Payne’s list of specialist sectors. The Air Travel Organisers’ Licensing (ATOL) is a UK Civil Aviation Authority (CAA) scheme to protect people who have purchased package holidays and flights from a member tour operator. The majority of UK tour operators are required to hold an ATOL licence in order to legally sell air travel. ATOL licensed firms will have had their business practices inspected by the CAA and licensed tour operators must also obtain insurance bonds from the CAA so that, if an event causes the airline to be unable to provide travel for its customers, refunds can be provided to affected travellers and flights home arranged (in addition to accommodation and other items which may be included in a package holiday). In order to help improve the standard of ATOL reporting and to provide assurance that financial information which is submitted on behalf of ATOL holders is accurate, the CAA has developed the ATOL Reporting Accountants’ (ARA) scheme, designed to ensure that designated accountants of participating bodies are sufficiently knowledgeable about both the industry and the specific requirements of ATOL to provide the required assurance needed by the CAA. Only professional accountancy bodies which have signed the agreement with the CAA can
designate their members to become an ARA. So far that list consists of ICAEW, ICAS, AAT, ACCA and the IFA and they will be required to provide the appropriate level of continuing professional development (CPD) for their members to successfully undertake ATOL work. It also means that professional bodies will have in place a more professional regime that focuses on the demonstration of competence, helping to reduce overall risks in the market of reporting false or inaccurate financial information by ATOL holders. Each professional accountancy body signed up to the ARA Scheme has provided the CAA with a list of their designated ATOL Reporting Accountants members, which is regularly updated. if
RUSSEL BYRD, Partner, ACA FCCA Russel leads our team of auditors: “Being an ATOL Registered Accountant in Gloucestershire adds further credibility to our team and provides comfort to those companies, who are governed by ATOL, that we can use this expert knowledge to help them manage such industry specific risks”
For more information contact Russel Byrd on 01242 776000 or visit www.randall-payne.co.uk Summer 2016
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payroll news
Payroll Compliance the moving feast
2016/17 has also bought with it a raft of changes that employers need to be aware of
We now have both the national minimum wage and the national living wage. To confuse matters further, there are court orders and salary sacrifice schemes, a voluntary living wage (£8.25 outside London and £9.40 within London) and a number of new allowances and changes. This is just a brief overview: Student Loans There are currently two student loan categories: Plan 2 students, who have had loans since 1 September 2012 in England and Wales and Plan 1 students who are the remainder. Plan 1 students need to earn £17,495 before having to make repayments whereas Plan 2 students need to earn £21,000. The starter checklist for new employees will need to include “do you have a student loan that isn’t fully paid?”; “are you repaying by agreed monthly amounts?”; “which type of student loan do you have (Plan 1 or Plan 2)?” The P45 form has not been adjusted to deal with this , but no answer means a default to Plan 1.
Marriage Allowance Distinct from the historic allowance, this allows £1,100 to be transferred between a married couple or civil partners if the individuals were born after 5 April 1935 and the highest earner is a basic rate tax payer. The new payroll codes for this are a suffix of ‘M’ for the individual receiving the shared allowance and an ‘N’ suffix for the transferor. Significant changes in National Insurance for this year include apprentices, levels, employment allowance and letters. The Employment Allowance has been increased to £3,000 from 6 April 2016, but eligibility has been restricted so that Director only payrolls cannot claim. There must be a second employee receiving at least one payment of £156.08, based around the current interpretation of the information.
However, HMRC will issue an SL1 notice which will confirm the correct plan and act as a notification to change plans. The Plan 2 threshold has been set for the next 5 years. From September 2016 there will be a Plan 3, which includes up to £10,000 for masters (research) and Plan 4 (taught). Then, in September 2017, any loans for part time degrees or second degrees in STEM subjects will also fall in. Repayments are to be set at 6% over the threshold and will run concurrently with Plans 1 and 2. There is a student loan plan tool at: http://www.studentloanrepayment.co.uk/portal/ page?_pageid=93,6678408&_dad=portal&_ schema=PORTAL
The most significant introduction is the Abolition of Employer’s NIC for Apprentices. An apprentice is defined as someone who is following the “government approved framework” which entails a three way written agreement with start and end dates. If the employee fits as an apprentice and is aged under 25, there will be no employer’s NI up to the upper earnings limit. To aid in this there is the introduction of a new threshold, the AUST (Apprentice Upper Secondary Threshold) of £43,000 in 2016/17. In conjunction with this there is the introduction of the Apprenticeship Levy, which will apply to all employers and sectors subject to an NI’able payroll for 2016/17 of £3m upwards. It is likely that this will be collected for the first time in April 2017, be reported via RTi and payable with the normal PAYE/NI payment. The Levy will be put into a pot for employers to spend on apprenticeship courses.
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For further details, please contact our Payroll team at payroll@randall-payne.co.uk or on 01242 776000 14
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academies news
Academies Update Academies Accounts Direction 2015/16 The Academies Accounts Direction for 2015 to 2016 has now been released along with a brief guide to assist in the transition to the SORP 2015, Academies Accounts Direction and FRS102 All Academy Trusts must now use this Accounts Direction when preparing their Financial Statements for the period ending 31 August 2016. On the Accounts Direction page is the guidance notes for submitting the Financial Statements by 31 December 2016, along with the link to the online cover form which needs completing before submission. As usual the Accounts Direction outlines the following requirements for an Academy Trust: • Preparing an annual report and Financial Statements to 31 August
• Submit the audited accounts and auditor’s assurance report to the EFA by 31 December
• Have these Financial Statements audited by a registered independent auditor
• File the accounts with Companies House as required by the Companies Act 2016
• Produce the regularity, propriety and compliance statement and have an assurance report on this statement by the auditor
• Publish the accounts along with those from the prior year on the trust’s website by 31 January
There have been some changes in the Accounts Direction initiated by the change in accounting standards to FRS102 and also the updated Charities SORP 2015. In terms of the financial reporting: • There is less charitable activity disclosure as required by the new SORP •
Related party transactions have been clarified as including any transactions with connected parties, irrespective of them meeting the related party definition
• Guidance on service concession arrangements • Suggested wording for when the Academy is a member of the Risk Protection Arrangement • Guidance on required disclosures for comparative information given the additional requirements in the SORP
In addition to this, specific guidance has been provided on the transition guidance together with a new section which sets out the required disclosures for the transition to FRS102. The new notes include key items such as: The basis of preparation accounting policy should reflect the change to the new accounting framework
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All accounting policies should be considered for suitability and whether the comparatives will need restatement to reflect those that have needed changing
A reconciliation of any changes made to the comparatives to reflect the change to FRS102.
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academies news
Academies Update The key action points for Trustees and senior staff are summarised below: • Determine the Trust’s key management personnel • Compare the current level of reserves against the reserves policy • Ensure risks can be identified and then describe how they are being managed •
Consider whether accounting systems and, in particular, the chart of accounts remains appropriate for the change in classification of income and expenditure by activity and restate comparatives where there have been changes
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continued...
Determine whether any staff are entitled to holiday pay and, where the holiday year is not coterminous with the financial year, calculate an accrual or prepayment
• Consider whether to take the option of the one-off revaluing of fixed assets • With the change of definitions on the statement of cashflows be aware of category changes • Consider revenue recognition following change to probable • Consideration of the going concern status for at least 12 months from the date of approval
• Restate comparatives for the inclusion of Governance costs within support costs
• Ensuring appropriate FRS102 LGPS pension valuations obtained
• Determine the approach to the showing of comparative figures
• Ensure that operating lease disclosures now reflect the future minimum lease payments
• Determine whether software licences held are material and then whether they should be capitalised as an intangible asset
• Consideration of whether grants have unfulfilled conditions or contingencies attached to them
This means a quite extensive schedule of works to be done and this needs careful consideration as to when and how it will be achieved, as the timescales for the completion, approval and filing of the accounts remain unaltered. if
Condition Improvement Fund 2016 - 17 On 24 March the Parliamentary Under Secretary of State for School, Lord Nash, announced that the CIF 2016 to 2017 funding pot would be £435million. This will be split across 1,276 projects across 1,030 Academies and Sixth Form colleges. Those successful should have already received their notification.
are up to date. The CIF portal is the key location for finding all the information in respect of the successful bid, including terms and conditions, but also importantly the post approval guidance.
The priority for awarding funds went first to those dealing with compliance and health and safety issues, which could include asbestos, fire protection and electrical safety, then onto making buildings weather tight and continuous supply of water and heating.
This will also be the area for submitting your project monitoring returns, submitting any change of scope or change of payment profile requests and, on completion, the project completion return.
For those who received successful notifications, they need to accept the terms and conditions of the funding to gain the first payment, check the payment profile to ensure it meets the projects needs and then make sure the contact details
Those who were unsuccessful, a significant number given 3,500 applications with 1,276 successful, can review their project scores and feedback via the CIF portal which would then indicate if priority will be given should additional funds become available.
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For more information or guidance, contact our Academies Team on 01242 776000 16
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in the community
Busking for Young Carers
Restoration of the Nelson Trust’s Hub Bistro Clock
Gina Gardner recently put on a busking performance at the Cheltenham Brewery Quarter, in aid of our charity for the year, Gloucestershire Young Carers. Luckily we had great weather for the occasion and, with support on the day from Jo Kline and volunteers from GYC collecting funds, she raised a handsome total of £90.00!
We were pleased to support the Nelson Trust in its goal of restoring an important piece of Gloucester’s heritage, the 200 year-old Hub Bistro clock. The clock has been in a state of disrepair for many years. With its pendulum boxed in up in the TV lounge, the weights in the corner of the room and the mechanism on the top floor, it really is part of the fabric of the building and the Nelson Trust felt, quite rightly, that it deserved to be restored to its original beauty and tell the correct time! R&P joined the Townscape Heritage Initiative, EESI, Ecclesiastical and the Cumbria Clock Company to fund the renovation project. You can see the restored clock and enjoy a tasty breakfast or lunch at the Hub Bistro, which gives former vulnerable people the opportunity to rebuild and take back control of their lives.
HOWZAT! Randall & Payne Signs a Sponsorship Deal with Hatherley & Reddings Cricket Club work, locally and throughout Gloucestershire and we take very seriously our corporate responsibility to make a positive impact on that community and the environment. We also plan to hold staff events at the impressive clubhouse, so it’s a win-win for both parties.”
R&P is sponsoring Hatherley & Reddings cricket club, our neighbours in Shurdington, whose first team play in the West of England Premier League, Gloucestershire Division. The first phase of sponsorship provided a brand new set of first team shirts, made from the latest performance material, with a pro-fit look and the R&P brand. “We are thrilled to support our local cricket club which boasts a healthy seniors division and a
growing youth section from U6 right through to U19 for both boys and girls. It’s a great facility for a sport that rising in popularity,” said Tim Watkins. “Our sponsorship goes much further than team kit, we also plan to help fund cricket nets and sports equipment that benefits all players and age groups at the club, during the next couple of years.” “We are very much part of the community in which we
The first team play in the West of England Premier League, Gloucestershire Division, the other teams play at various levels in the local County League. The club is also home to the Gloucestershire Growlers, the County’s blind and partially sighted team. Club vice-chair, Rich Stewart, commented: “Hatherley & Reddings is a well-established club with fantastic facilities and friendly, family environment. With four competitive senior sides, a social Sunday team and ten youth teams made up of boys and girls aged 6 – 19, we are grateful to all those who support the club.”
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wednesday thursday friday
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1 2 3 Corp Tax due
july 2016
for period ended 30/09/15
4 5 6 7 8 9 10 P11D filing deadline Last date to agree PAYE settlements for 2015/16
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payments for PAYE & Class 1 Postal pay for class 18 19 20 21 22 BACS 23 24 class 1A NICs to clear with HMRC
NIC Payments (electronic submission)
1A NICs to HMRC Due date for 2016/17 PAYE month 3
A/cs filed at Deadline for 2nd IIGE 25 26 27 28 29 30 31 Co Hse, period end 31/10/15. Corp tax filing period end 31/7/15
SA payment on account
monday tuesday wednesday thursday friday saturday sunday
august 2016
Corp Tax due 1 2 3 4 5 6 7 for period ended 31/10/15
8 9 10 11 12 13 14
15 16 17 18 19 20 21 Due date for 2016/17 PAYE month 4
22 23 24 25 PAYE & Class 1 IIGE 26 27 28 NIC Payments (electronic submission)
Bank Holiday 29 30 31
monday
tuesday
A/cs filed at Co House, period end 30/11/15. Corp tax filing deadline period end 31/8/15
wednesday thursday friday
saturday
sunday
1 2 3 4 Corp Tax due
september 2016
for period ended 30/11/15
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12 13 14 15 16 17 18 Quorum
PAYE & Class 1 19 20 21 22 23 Due date for 2016/17 PAYE month 3
NIC Payments (electronic submission)
Skills for Business Workshop
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A/cs filed at Co House, period end 31/12/15. Corp tax filing deadline period end 30/9/15
www.randall-payne.co.uk
tax reference
income tax allowances 2016-17 Personal allowance:
Marriage allowance:
Personal allowance £11,000 Income limit for personal allowance £100,000 Income limit for married couple’s allowance £27,000
Married couple’s allowance for those born before 6 April 1935: Maximum amount of married couple’s allowance £8,355 Minimum amount of married couple’s allowance £3,220
vehicle benefits Company cars 2016/17 CO2 emissions (gm/km)
% of cars list price taxed
0-50 7 51-75 11 76-94 15 95 16 100 17 105 18 110 19 115 20 120 21 125 22 130 23 135 24 140 25 145 26 150 27 155 28 160 29 165 30 170 31 175 32 180 33 185 34 190 35 195 36 200 and more 37 Car Fuel Benefit 2016/17 £22,200 appropriate percentage* *percentage used to calculate the taxable benefit of the car for which the fuel is provided. For diesel cars add a 3% supplement but maximum still 37%. For cars registered before 1st January 1998 the charge is based on engine size. Company Vans 2016/17 = £3170 Fuel for Company Vans 2016/17 £598 Zero Emission Van 2016/17 20% of normal benefit.
corporation tax year to 31/3/2017 Now unified at a flat rate at 20%* Due to fall to 19% from 1/4/2017, 17% from 1/4/2020. *Different rates apply for ring-fenced (broadly oil industry) profit.
Blind person’s allowance
£2,290
Dividend allowance
£5,000
Personal savings allowance for basic rate taxpayers Personal savings allowance for higher rate taxpayers
£1,000
Bands of taxable income and corresponding tax rates 2016-17 Basic rate
20%
Higher rate
40%
Additional rate
45%
Starting rate for savings income
0%
Dividend ordinary rate – for dividends otherwise taxable at the basic rate 7.5%
£500
Dividend upper rate – for dividends otherwise taxable at the higher rate 32.5% Dividend additional rate – for dividends otherwise taxable at the additional rate 38.1%
Capital Allowance
Starting rate limit (savings income if other income is < £5000)
Plant & machinery main rate
18%
Basic rate band
Integral features, long life assets + cars over 130gkm
8%
New cars <75g/km
100%
Higher rate band
Annual Investment Allowance: up to 31 Dec 2015
£500,000
from 1 Jan 2016
£200,000
Complex rules apply where the accounting period straddles the change - contact us for specific advice.
mileage allowances Cars and vans Rate per mile Up to 10,000 miles 45p Over 10,000 miles 25p Bicycles 20p Motorcycles 24p These indicate the maximum tax free mileage allowance for own vehicle business use. Any excess is taxable.
£5,000 £0-43,000
£43,001 - £150k
Additional rate band Over
£150K
value added tax Standard rate
20%
Reduced rate
5%
Annual Registration Limit: from 1.4.16 (1.4.15 - 31.3.16 £82,000) £83,000 Annual Deregistration Limit: from 1.4.16 (1.4.15 - 31.3.16 £80,000) £81,000 No change to the Flat Rate scheme/ Cash Account limits
pension premiums 2016/17
• Tax relief available for personal contributions: higher of £3,600 (gross) or 100% of relevant earnings. • Any contributions in excess of £40,000, whether personal or by the employer, may be subject to income tax on the individual. • Where the £40,000 limit is not fully used it may be possible to carry the unused amount forward for three years. • Employers will obtain tax relief on employer contributions if they are paid and made ‘wholly and exclusively’. • Tax relief for large contributions may be spread over several years.
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Chartered Accountants • Business Improvement • Tax Planning • Audit • Wealth Management Randall & Payne is a brand name of Randall & Payne LLP. Registered in England & Wales number: OC345710. Chargrove House, Main Road, Shurdington, Cheltenham, Glos. GL51 4GA. Unless otherwise indicated we use the word partner to refer to a member of the LLP. Registered to carry on audit work in the UK and Ireland and regulated for a range of investment business activities by the Institute of Chartered Accountants in England and Wales. Details about our audit registration can be viewed at www.auditregister.org.uk for the UK, under reference number C002244548 and www.cro.ie/auditors for Ireland, under reference number EWC002244548. 20A member of the ICAEW Practice Assurance Scheme. www.randall-payne.co.uk