Massey Accounting Company

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National Minimum Wage Rise from 1 October 2015

National Minimum Wage (NMW) rates rise from 1 October 2015. For an employee 21 years old+ the NMW is now £6.70 ph. Also of note is a significant increase in the apprentice rate to £3.30 ph (from £2.73). Ensure your payroll procedures are up to date. For further details and more rates visit gov.uk

Our client’s will shortly be receiving personalised guidance.

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Optimal Director’s Salary for 2015-16

Probably the most important post of the year for company directors!

Wage riseThe small owner managed limited company will usually pay their directors / shareholders with a small salary + dividends.

The level of the director’s salary is usually set in order to avoid any income tax and national insurance. On this basis the recommended remuneration package would be:

Upper limits for 2015-16

Salary – per annum: £8,060 (last year £7,956)
Salary – per month: £671 (last year £663)

Dividend – per annum: £30,891 (last year £30,518)
Dividend – per month: £2,574 (last year £2,543)

However, since the introduction of Employment Allowance some company directors will be better off paying themselves a £10,600 salary and slightly lower dividends (up to £28,606).

Employment Allowance means that most employers will be able to reduce their Class 1 National Insurance contributions (Employers NI) by up to £2,000.

So, increasing your salary and yet not having to pay the Employers NI will save the company £203 per director / shareholder.

Not everyone will benefit. Generally if you have other income you’d be better sticking with the above “usual” remuneration package.

Each client of Massey Accounting Company will be receiving a personalised recommendation shortly.

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View our video: How to Save Tax YouTube-logo-full_color; and follow our blog on Google+ or click +Follow at the bottom of this page.


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Which Accountant Would You Choose?

Not what you would call an accountant?
Check out this brief but insightful article:

Which Accountant Would You Choose?

 

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Are gifts to customers allowable against tax?

As a general rule gifts to customers are not allowable against your taxable profits.

However, follow this guidance and you can afford to be a little more generous with your customers this year:

Small gifts which carry a conspicuous advertisement for the trader are an allowable expense. Common examples include: branded diaries, pens and mouse mats. The advertisement must be on the gift, not just the wrapping.

Unfortunately the expenditure of the following kind is specifically excluded (even if it incorporates your advertisement): Food, drink, tobacco, gift vouchers and gifts exceeding £50 per recipient.

Source material: http://www.hmrc.gov.uk/manuals/bimmanual/BIM45070.htm

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National Minimum Wage Rise from 1 October 2014

National Minimum Wage (NMW) rates rise from 1 October 2014. For an employee 21 years old+ the NMW is now £6.50. Ensure your payroll procedures are up to date. For further details visit gov.uk

Our client’s will shortly be receiving personalised guidance.

Enjoy saving tax?

View our video: How to Save Tax YouTube-logo-full_color; and follow our blog on Google+ or click +Follow at the bottom of this page.


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Invoice on the go

Invoices by WaveMy favourite (and free) cloud bookkeeping system just got better – the new Invoice by Wave app allows on-the-go invoicing. Download it from the App Store.

As I’ve said before, I’m not an affiliate, just a fan of this cool bookkeeping system that’s already helping many of my clients.

 

Enjoy saving tax?

View our video: How to Save Tax YouTube-logo-full_color; and follow our blog on Google+ or click +Follow at the bottom of this page.


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Tax Free Pay Rise

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Next time you’re considering giving your employees a pay rise (or yourself as director or secretary) consider giving them a mobile phone instead!

Presuming the employer takes out the contract in the company name and provides just one phone to their employees then this is a tax free benefit to the employee – regardless of how many personal calls the employee makes.

Example

An employee currently pays a £40 per month mobile contract. After having paid his tax (20%) and National Insurance (12%) this contract costs the employee £59 of their monthly gross wage!

Presuming the employer could secure a similar tariff in their name the cost to the employer might be just £27 per month (after VAT and corporation tax relief).