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Essential monthly tax news and marketing strategies for busy accounting and tax professionals.


Could digital versions of paper based newspapers benefit from zero-rating?

7 minute read.

Summary 

The appellant was the representative member of a VAT group and appealed against decisions of HMRC that digital versions of The Times, The Sunday Times, The Sun, and The Sun on Sunday could not be zero-rated under Item 2 Group 3 of Schedule 8 Value Added Tax Act 1994 and were, therefore, standard rated for VAT purposes.

Secondly, even if the digital editions of the above titles are not ‘newspapers’, the appellant contended that the principle of fiscal neutrality nevertheless requires zero-rating on the basis that, viewed from the perspective of the customer, they satisfy the same customer needs as conventional printed editions. HMRC argued the digital editions were not similar to the newsprint editions and, in any event, the principle of fiscal neutrality could not be used to expand the borders of zero rating from their 1991 limits.

Read more…

What tax reliefs remain for landlords?

5 minute read.

Gradually reliefs and allowances relating to renting are being eroded away and with the Property Tax Campaign in its fifth year, it is obvious that HMRC believe that there is still more tax to be gleaned. However, one relief that it would be difficult to withdraw entirely is the right to claim expenses incurred on the running of the property. Renting is deemed to be a ‘business’ for income tax purposes and as such similar expenses incurred in the running of other businesses are allowable. Repairs, car running costs relating to the business use, council tax, management expenses, legal fees are all allowable.

Replacement furniture relief

The ‘Replacement Furniture Relief’ is a relief that had to be fought for by landlords and their representative associations as HMRC was intent on abolishing both the ‘renewals allowance’ as well as the ‘wear and tear’ allowance which permitted landlords of furnished residential properties to deduct 10% of net rent from their profits to cover ‘wear and tear’ on their properties whether or not any furnishings, fixtures and fittings or repairs had taken place. The ‘Replacement’ relief can be claimed by landlords of all residential lets (except furnished holiday lets) whether fully or partly furnished, as a deduction for the costs of replacing capital items such furniture, furnishings, appliances and kitchenware provided by the landlord for use by the tenant. Note that this applies to replacement only, not the initial cost.

Principal private residence relief

Another relief that is sure to remain, although restrictions have already been imposed, is the principal private residence relief (PPR). The PPR rules typically exempt the capital gain on the sale of a main residence. The relief is clearly targeted at owner-occupiers, but landlords can take advantage (providing the property has been the individual’s only or main residence at some time) by claiming the last 18 months ownership (9 months’ following the Autumn 2018 budget and 36 months for those moving into care homes) as occupation regardless of whether the landlord has been resident during those last months.

It is good tax planning for anyone purchasing a second property to elect for one of those properties to be the PPR and hence secure the 9 months tax relief. So long as the initial election is made, then it can then be varied (‘flipped’) as many times as desired by submitting a further election. There is no prescribed form or wording for the election, but it must be made within two years of the change in ‘combination of residences’. Should the two-year time limit be missed, there needs to be a ‘trigger’ event in order to reset the election date.

Affect to smaller landlords

The private rented sector has become a very different place over the past few years and although steps can be taken that may reduce the impact of the various restrictive changes that have taken place, research shows that the rules have affected the smaller landlords who have between three and five properties (89% of the sector) rather than the professional landlords who have emerged relatively unscathed.

Tax tip #1: Designing a tax-efficient remuneration package

2 minute read.

A typical remuneration package comprises a number of elements. Some of these are subject to legislative control. For example, employers must pay employees in accordance with the National Minimum Wage legislation, paying at least the National Living Wage to workers aged 25 and older and, for workers under the age of 25, at least the National Minimum Wage for their age. In addition, employers must comply with the equal pay legislation and provide paid holiday at least equal to the statutory minimum. However, other aspects of the remuneration package are at the discretion of the employer. 

In setting the remuneration package, the employer must have regard to a range of factors, including the culture of the organisation, market conditions and industry norms. Within these parameters there are opportunities to structure the package to take advantage of the various tax and National Insurance exemptions and reliefs available. These can generate tax and National Insurance savings for the employee and National Insurance savings for the employer.

The opportunity to save tax and National Insurance should be taken into account when designing a remuneration package. However, as always, this is only one element and all factors affecting the pay and performance culture of the organisation should be considered.

The best marketing strategies for accountants

5 minute read.

Marketing for accountants is tough and many tax and accounting firms neglect their marketing, whether it’s because they’re too busy, don’t think they need to, or are just not sure where to start. This article is a great place to start if you’re a small firm or sole practitioner who wants to get going with your marketing.

How to get started with your marketing

The best way to get started is to make a brief marketing plan to help you understand where you are now and where you want to get to. Make a note of what sets you apart from your competition, the services you want to focus on, and your goals for the year. When setting marketing goals, write them as SMART goals (specific, measurable, achievable, relevant, time-based), for example: in 6 months’ time, we will have increased our Facebook followers by 100, by posting 3 times a week and asking our current customers to like our page.

Once you’ve created your plan, follow our top marketing strategies for accountants to make sure you’ve got a solid foundation to build your business and your brand this year.

Website marketing for accountants

Your website is your most important marketing tool and is often a customer’s first impression of you. Make sure your website domain name is simple and easy to spell to help customers and search engines find your site. Your site should have the basics of who you are, what your services are, and your contact details front and centre. Don’t fill your website with irrelevant pages, less is more if you don’t have content to post – in fact, having lots of irrelevant pages on your site can actively harm your search engine ranking. It’s important that your website is up-to-date and modern in design – there are plenty of low-cost do-it-yourself website builders that you can use to create a simple site (Wix, Squarespace, Weebly, WordPress).

Social media marketing for accountants

Many accountants see social media as a waste of time for their firm because they don’t use it themselves or think their customers don’t bother. However, social media is a valuable and free asset to your practice. If you don’t have the time or confidence to post, just by having a business page with your contact details and a good quality photo of you or your firm will increase trust and confidence – customers might be suspicious if you don’t appear anywhere on social platforms. We would recommend that you maintain a LinkedIn and Facebook business page, but with Facebook remember to make sure your privacy settings are on to prevent potential customers seeing your personal posts.

Word of mouth marketing for accountants

Word of mouth or referral marketing is often the main way that small tax and accountancy firms market their business. To increase your effectiveness, you can engage with your best clients to ask for referrals and testimonials – giving an incentive such as a discount or an extra service is an easy way to gather referrals and testimonials quickly.

Content marketing for accountants

Content marketing is rapidly increasing in popularity as an inexpensive and effective marketing strategy and is a tool that accountants can use to their advantage. It covers creating and publishing content which is not specifically focused on sales, instead giving useful information. Accountancy is based on selling expertise, making it ideally suited for content marketing. To get started, you can create an email newsletter, blog, articles, white papers or fact sheets to post online or give to your clients in person. Benefits of content marketing include boosting sales through soft selling, building brand awareness, demonstrating expertise, and increasing customer engagement.

Local marketing for accountants

As a small firm, putting the time in with your local community can make all the difference. Sponsoring local events, joining or creating networking events in your area, posting in local social media groups, or being a part of an unrelated local hobby group will instantly widen your pool of potential clients and referrals.

We will be covering all of these types of marketing strategies for accountants in more detail on the blog soon.

Welcome to our blog

Welcome

1 minute read.

Welcome to the Tax Insider Professional blog, a dedicated place for accountants and tax professionals to learn and share.

Each week, we’ll bring you marketing for accountants best practice and insights as well as sharing tax tips and extra tax content that we think you’ll find useful in running your firm. We’ll also share and recommend interesting content from the industry, as well as news and updates about us.

We hope that this blog will become a helpful resource to you and your firm. If you have any suggestions on what you’d like us to write about, please leave a comment, email us at support@taxinsider.co.uk, or use our contact us form.

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