Our North East Member Firm Assist With Management Buy Out

Over the past couple of years there have been some changes at Barnard Castle based Steel Fabricator S&A which have now resulted in the sale of the building fabrication side of the business in a management buyout.

With the support of our North East member firm Tait Walker, the business has been purchased by the MBO team at S&A Fabrication, which consists of sales director Simon Pelly and senior estimator Jonathan Kirk. They will take over the daily running of the business and future growth plans, with the previous owners Geoff and John continuing to work on a consultancy basis.

Tait Walker worked with commercial law firm Mincoffs Solicitors and HSBC UK alongside the MBO team to ensure a smooth process throughout for all parties. Barnard Castle-based S&A Fabrication Ltd, specialises in manufacturing steel framed buildings for the agriculture industry, as well as producing a range of commercial and industrial buildings. Established in 1978 by Geoff Simpson and John Allinson, the firm is known for its popular Roundhouse Buildings Solutions business, a concept which brings advanced, innovative building design to the agriculture market.

Originally starting the work in June 2017, Tait Walker have been advising Simon and Jonathan at S&A Fabrication Ltd throughout the entire MBO process, as well as assisting with raising finance from HSBC UK to fund the transaction.

Michael Smith and Lucy Elliott from our National Corporate Finance team, worked with Tax Associate Adrienne Paterson to provide transaction and tax advice on the deal structure and Paul Shields who heads up the Durham office. Associate Solicitor Chris Hughes of Mincoffs and Martin Glaholm of HSBC UK advised on the movement of cash through the group structure and the legal process.

Michael Smith commented:

“We are delighted to have assisted Simon and Jonathan on the successful MBO of S&A Fabrications and Roundhouse Building Solutions.

Through our collaborative approach with Mincoffs Solicitors and HSBC UK, we have played a key part in securing the long-term future of the two established North East companies.

We are confident the group will thrive under the new management team with support from HSBC. We wish them every success going forwards.”

The Corporate Team at Mincoffs Solicitors (which included associate solicitor Chris Hughes who led on the acquisition, Partner John Nicholson and paralegal Bri Cheng) worked closely with the firm’s Commercial, Commercial Property and Employment teams to deliver advice to the management team on the transaction.

Chris Hughes from Mincoffs Solicitors added:

“The team and I were delighted to act for Simon and Jonathan on the management buyout and are proud to have played our part alongside Tait Walker and HSBC UK in delivering the transaction and ensuring continuity for the staff. We wish Simon and Jonathan the best of luck with their future plans for the group”

Commenting on the MBO, previous owner John Allinson said:

“Geoff and I are thrilled that Simon and Jonathan have been able to fund this purchase and will continue with the S&A and Roundhouse brand. We wish them every success and we’ll always be here to offer help and support when required.”

HSBC UK facilitated the transaction of S&A Fabrications Ltd by listening to what was required from management teams and putting a suitable finance structure in place.

David Slane, Area Director for HSBC UK in the North East, said: “As soon as we met the management teams at both S&A Fabrications and Roundhouse we had great confidence in their vision for the future of the businesses and the retention of jobs for the local area. We listened to what was required from both sides and put a suitable structure in place to facilitate the management buy-out. We place great importance on supporting local businesses, communities and economies and this deal evidences our ability to support companies across a variety of sectors in the North East.”

If you have any questions or if you would like to speak to us about your business, please contact Hannah Farmborough or call on 0207 429 4147 to be put in contact with a member of our Corporate Finance team.

This article originally appeared on the blog of our member firm, Tait Walker.

Reduced Administrative Burdens for Charities

Administrative burdens for charities

From April 2019, the Government will introduce measures to reduce administrative burdens for charities. These include:

  • An increase from £5,000 to £8,000 in the upper limit of trading charities can carry out without incurring a tax liability where turnover is under £20,000 and from £50,000 to £80,000 where turnover exceeds £200,000.
  • Allowing charity shops using the retail gift aid scheme to send letters to donors every three years when their goods raise less than £20 a year, rather than every tax year.
  • An increase to the individual donation limit under the gift aid small donations scheme to £30, which applies to small collections where it is impractical to obtain a gift aid declaration.

If you would like to discuss this with us in more detail or if you have any questions, please contact Hannah Farmborough or call on 0207 429 4147 to be put in contact with a member of our Not for Profit team.

This article originally appeared on the blog of our member firm, MHA Broomfield Alexander.

Cyber Security for “The Quasi IT Director” ®

Cyber Security

Hardly a week goes by without news of another cyber-attack, or the release of confidential information into the public domain.

As a non-technical Board Director who is responsible for IT, “The Quasi IT Director” ®, it is your responsibility to ensure that your company’s IT remains secure to stop hackers getting in, but also to ensure that data doesn’t leak out!

Since the introduction of the General Data Protection Regulation (GDPR), businesses that fail to secure their data, could face heavy fines and so we have set out some of the areas that you should review when considering your IT security policy.

 

Understand the landscape and identify what is applicable and relevant to your business: What can I do?
  • Accreditation standards,
  • Sanctions,
  • Regulation – Industry related, GDPR (General Data Protection Regulation) – applies to everyone.
  • Identify where your data is and who has access,
  • Review your data policies and processes and ensure your employees are aware of them,
  • Review the tools in place to: Prevent, Detect, and React.
Threat intelligence will assist in helping your business understand the risks by providing insight on: How can I get it?
  • The mechanisms used,
  • How to detect a breach,
  • What are the implications,
  • What you can do to protect your assets.
  • Sign-up to security newsletters,
  • Outsource your security to a third-party organisation or Threat Intelligence service,
  • Speak to your IT support organisation.

Don’t be Complacent, the Risks are Increasing:

  • Security is not something that you address and then move on. It must be continually monitored and reviewed,
  • In the recent HM Government, Cyber Security Breaches Survey 2018, it was reported that, for micro/small organisations:
    • 42% had identified a cyber security breach in the past 12 months.
    • Only 19% have undertaken all 10 steps of the Government’s 10 Steps to Cyber Security guidance.
    • Only 26% had any formal security policies.
    • Only 19% had any cyber security training.

Apply Security That is Appropriate for the Assets you Wish to Protect:

  • Define your baseline security that applies to everything in your organisation.
  • Identify the assets that require additional protection, for example:
    • Customer databases,
    • Intellectual Property,
    • Sensitive information, etc.
    • …and apply appropriate protection to them.

Keep your Hardware and Software Up-to-Date:

  • Ensure you use current versions of supported applications. Older applications are prone to security vulnerabilities and should be avoided.
  • Keep operating systems current and patched. This may also require periodic hardware updates.

Ensure you Have a Robust Password Policy:

  • A password should have a minimum of eight characters and contain a mixture of upper and lowercase plus special characters and numbers. The addition of each extra character will greatly improve the strength of the password.
  • Using current hacking techniques, the time taken to crack a password is demonstrated in the table below:

  • Avoid using the same password for multiple accounts.
  • Avoid common passwords and ensure that they expire periodically and cannot be reused.
  • Consider using pass phrases which are commonly made up from the first letter from each word of a sentence that you can remember.
  • Consider the use of a password manager to help you remember them, but don’t write them down!

A guide to how strong your password is can be found here, although this should not be considered to be fool proof.

Be Aware of Phishing:

  • Phishing is the attempt to obtain sensitive information such as usernames, passwords, and credit card details (and, indirectly, money), often for malicious reasons, by disguising as a trustworthy entity in an email.
  • Email addresses and personal details are often captured through social media sites, chain emails or stolen databases.
  • The email will contain links to websites that may look legitimate but are indeed fake and will ask you to enter sensitive information.
  • The email may also include attached documents which you should NEVER open.
  • Be aware of spoofed email addresses that contain domain names that are very similar to yours.
Viruses, Malware and Ransomware: How can I prevent this from happening to my organisation? What should we do if we get infected?
  • Computer viruses are not new, they have been around for many years. Sometimes they are just annoying. For example, adware that places unwanted adverts on your screen, or high jacking your search results so that you are directed to certain web retailers.
  • Viruses in the form of malware are also not new, however, it is now becoming a lucrative money-making opportunity for cyber criminals.
  • Ransomware is a malware virus that infects computers and network storage devices. They are often difficult to detect and can remain dormant, sometimes for many weeks, but in the background, they are encrypting your data. Once they have finished they will display a message requesting that you pay a ransom before you can access your data again.
  • Ensure you make regular backups of all important data and keep them safe for several weeks before they are overwritten.
  • Ensure you use a respectable antivirus (AV) solution. Free AV solutions, and those bundled with the operating system, will prevent some well-known viruses, but are traditionally not as good as those for which you pay a subscription, and will not be updated as regularly.
  • The use of user accounts with admin privileges should be avoided to limit the impact of a virus outbreak.
  • All staff (including senior management) should attend regular IT security awareness training to understand the risks.
  • Turn your computer off. Don’t try and shut it down. You may need to hold the power button in for a few seconds. If this doesn’t work, pull the power from the computer or wall socket.
  • Disconnect any network cables and/or external storage devices. This will help limit the damage if the computer is inadvertently switched back on again.
  • Don’t pay any ransom demands. There is no guarantee that you will get your data back anyway.
  • Call your IT helpdesk or support organisation for assistance.

Cyber Security requires more than just a common-sense approach and our Technology Advisory Services Team has vast experience in helping organisations ensure their IT systems and services are resilient, reliable, scalable and secure, whilst also keeping a watchful eye on cost.

If you would like to find out how we could help your business or if you have any queries relating to this or any other IT matter, please contact Hannah Farmborough or call on 0207 429 4147 to be put in contact with a member of our team.  

This article originally appeared on the blog of our member firm, MHA MacIntyre Hudson.

Top Tips for Creative Start-Ups

Creative Start-Ups

Despite the digital boom, getting a job in the creative and tech industries can be notoriously difficult which is why an increasing number of intrepid entrepreneurs are taking the decision to start their own business.

According to Companies House data, there were 1,296 technology company incorporations in 2017 in the South East alone – a 40% jump from 2016.

We’ve put together our top tips for creative start-ups, to help you get started on your path to entrepreneurship!

Be Creative – Write a Detailed Business Plan!

A good business plan will help you to test your idea, identify any weak points and is a real must if you want to secure finance. A business plan will also help you to define your ‘why’ – why you are going into business and what you are trying to achieve.

Your plan should serve as a guide, but it’s important to be flexible and agile when necessary – it is one of the main advantages of being a small business. Think of your plan as a road map which is designed to point the way to your destination, but knowing that when you get there (or preferably before) there is another plan to be made as your business grows.

Things are constantly changing in a thriving business. Changing trends, competitor behaviour or your sales figures may nudge you in a direction you wouldn’t have previously dreamed of. These can require new goals and strategies to achieve them.

Of course, a change in plans may also require refinancing – another important reason to keep your business plan up to date. These tips will help you revise your plan painlessly, so you’re in the best position to stay on course and impress a potential lender when you are looking for funding from a lender or investor.

Most importantly and above all else, a business plan is for YOU – the owner of the business. It’s your vision and defines where your business is now and where you want it to go to – it’s the route map of how you get there. Use your plan as a working document to keep you on track and keep you accountable for what you set out to achieve.

Set up Your Structure

You’re ready to start your new business, but have you considered how the choices you make now will affect its growth? One of the earliest decisions is your business structure: should you set up as a sole trader, partnership or as a limited company? All of these have different tax issues to consider, as well as different liabilities. While it’s possible to change your business structure, it’s much easier to set up correctly from the beginning.

Our team can help you look at the pros, cons, ongoing filing and tax implications associated with the main start-up structures, to help you decide which is right for you.

Get Help

Most people who start up in business have a strong business proposition, great ideas, enterprise and commitment. However, you can’t be an expert in everything! The next step is to find a business adviser who can help you on your way to achieving those goals.

Some of the things you need to think about can seem daunting and even off-putting to the budding entrepreneur. The good news is that you don’t need to be an expert in these fields to succeed in business. All you need is the support of a good professional to guide you along the way.

Find Some Funds

Raising finance for a start-up is never easy and very often involves an element of ‘bootstrapping’ or ‘sweat equity’. This means founding and building a company from personal resources, operating revenues and hard work! Availability of debt funding from banks is limited, and attracting equity investment at this stage can often mean having to give away too much of a stake in what should be your business.

A different avenue you can take is a start-up business grant. These are extremely popular, and very competitive. There are new ones popping up all the time, so keep a look out for funds such as the Skills Investment Funds, a match funding scheme for training in games and other creative sectors.

Technology companies should also be aware of Research and Development (R&D) tax credits. This tax relief is a government incentive to encourage innovation, and if you can demonstrate technological advancement, you may qualify. Don’t worry though, lab coats aren’t a requirement, just a tax adviser who can give you chapter and verse!

Other funding opportunities include the Enterprise Investment Scheme, video games tax relief and the Patent Box regime.

Gaming

If you are considering setting up a games company, our member firm Henderson Loggie have produced top tips for starting a games company and top accounting tips for starting your own games studio.

If you have any questions or if you would like to discuss anything with us in more detail, please contact Hannah Farmborough or call on 0207 429 4147 to be put in contact with a member of our team.  

This article originally appeared on the blog of our member firm, MHA Carpenter Box.

Academies and Related Party Transactions

Related party transactions

Related party transactions and academies have always been a contentious area for a number of reasons. It is sometimes perceived, particularly in news reports, that the Trustees are benefiting in some way from their position and not acting in the best interests of the Trust. In all likelihood, related party transactions are taking place because they represent best value for money for the services provided. Also, given the links that schools develop through their Trustees within the community, it is highly likely that there will be some connection between Trustees and local businesses.

‘At Cost’

In this year’s handbook, the requirements for the reporting and treatment of related parties have been further expanded, having developed over the past few years. The requirement for services exceeding £2,500 to be obtained ‘at cost’ has been in place since November 2013. As a reminder, Trusts should ensure that they have received a statement of assurance from the related party individual or organisation that their charges do not exceed the cost of the goods or services, and that the goods or services are provided on the basis of an open book agreement, including a requirement for the supplier to demonstrate clearly, if requested, that their charges do not exceed the cost of supply. Trusts should also consider whether they think it is necessary to request the demonstration of ‘at cost’ basis. Whatever the decision, all discussions and evidence should be minuted and filed. Ultimately, the Trustees are responsible for obtaining value for money and any decisions made need to be justified on this basis.

Reporting Related Party Transactions

In the 2018 handbook the ESFA has gone even further in the requirements for related party transactions.

From 1 April 2019, Trusts must report all transactions with related parties to ESFA in advance of the transaction taking place.  The transactions will need to be reported using an online form and Trusts will have to put procedures in place to ensure that all staff are aware of the requirements and who has access to report transactions.

Trusts must also obtain the ESFA’s approval for:

  • Transactions with related parties that are novel, contentious and/or repercussive.
  • A contract with a related party exceeding £20,000 or which takes the total value over £20,000 for the year.

Novel transactions are those of which the academy has no experience, or are outside the range of normal business. Contentious transactions are those that might cause criticism of the trust by Parliament, the public or the media. Repercussive transactions are those likely to cause pressure on other trusts to take a similar approach and hence have wider financial implications. It may not always be clear whether a transactions falls within one of these categories, but if in doubt the Trust should seek approval from the ESFA.

Related Party Staff

In the 2018 Accounts Direction, further guidance has been included for the situation where a member of a Trustee’s family is employed by the Trust. This is quite a common occurrence within the sector and something we often come across. The ESFA have taken quite a pragmatic approach. This disclosure doesn’t require details of the salary paid, but requires confirmation that they are paid within the normal pay scale for the role. Example wording is provided in the Coketown proforma accounts.

Given the contention in this area we can expect further guidance to continue to be released.

If you have any questions or if you would like to discuss your Multi Academy Trust with us in more detail, please contact Hannah Farmborough or call on 0207 429 4147 to be put in contact with a member of our Academies team.

This article originally appeared on the blog of our member firm, MHA Moore & Smalley.

VAT Deregistration

VAT Deregistration

When and How to Begin the Process of VAT Deregistration

These days VAT thresholds are the subject of much speculation, with the Government concerned that many business owners deliberately choose to stay below the VAT-registration threshold.

Limiting your ambition in this way might seem counter-intuitive – surely you want your business to get as big as possible? However, it can make sense if you are seeking to make a sustainable living rather than get rich, perhaps by trading on online auction sites, or running a café with limited opening hours.

If your business’ turnover is predicted to fall below £83,000 over the next year, it can voluntarily deregister for VAT. You will need to deregister from paying VAT if your business ceases to trade.

Voluntary Deregistration

Your business can deregister if it expects taxable sales in the next 12 months to be less than the deregistration threshold, which stands at £83,000 in 2018/19. A voluntary deregistration from VAT can take effect from a current or future date. If no date is specified, it takes effect from the date HMRC receives the application to deregister, or a later date as agreed with the Revenue. You cannot backdate deregistration, even if you made a mistake in registering for VAT in the first place, or you could have applied to deregister earlier but didn’t for whatever reason.

Compulsory Deregistration

If your business has ceased to trade and has no intention of making future taxable sales, it must deregister from VAT with effect from the final day of trading. However, there is scope to extend this date and therefore capture some final purchase invoices for the purposes of input VAT. There may well be professional fees to pay, which arrive after your business makes its last sale.

Example

Ben and Pete are VAT-registered home fitters trading as a partnership, which makes £90,000 in annual income. Both partners work full-time and they have no employees. On 31 October 2018, Pete decided to retire to leave Ben as the only fee earner. Pete plans to remain a sleeping partner.

All things being equal, expected sales in the next 12 months will be £45,000, so the business can deregister on 31 October 2018. This might be worthwhile if many of their customers are unable to claim input tax because they are private individuals. The partnership will also avoid having to enter the Making Tax Digital for VAT regime, which is due to take effect from 1 April 2019.

Assets Held on Deregistration

If your business still holds assets and stock on the day it deregisters, there can be a VAT liability to pay as those assets are deemed to have been disposed of at their market value on that day.

There are ways to reduce or eliminate the potential VAT liability, such as:

  • The VAT payable is based on the market value of the assets or stock on the date of deregistration, taking into account depreciation, damage to the goods, and obsolescence of the items.
  • No VAT is liable on an asset if input VAT was not claimed when it was purchased – for example, a second-hand van bought from a business which was not VAT registered. The exception is when standard-rated goods were obtained VAT-free as a result of taking over a business as a going concern.
  • No output VAT will be payable on the value of assets if those goods are zero-rated or exempt from VAT.
  • No output VAT is due on intangible assets, such as patents or goodwill.

Finally, where the total of output VAT calculated in respect of all the assets and stock held at deregistration amounts to less than £1,000, no declaration is needed on the final VAT return.

Example

For the purposes of this example let’s revisit Pete and Ben, who deregistered from VAT on 31 October 2018. On that day, the partnership held a one-year-old car bought for £15,000 plus VAT, but no input tax was claimed because the vehicle was for private use. They also had tools purchased over a number of years, costing £6,000 plus VAT. No output tax is due on the car because input tax was not claimed when it was purchased. The tools have depreciated to a market value of £2,000 on 31 October 2018. If the tools were sold at that value, £400 would be charged (VAT at 20%). Anything less than £1,000 is not considered a significant amount in this context, so no VAT has to be accounted for in respect of those tools.

Post-Deregistration Expenses

On your final VAT return, your business must account for VAT on unpaid sales invoices, even if it uses the cash accounting scheme. It can also claim input VAT on unpaid purchase invoices.

Once the final VAT return has been submitted, it is not too late to make a claim for business expenses. You can claim input VAT on purchase invoices, such as accountancy fees, that are dated after deregistration, so long as they relate to the period your business registered for VAT.

Bad Debt Relief

When your business ceases to trade, it may not have been paid for its final sales. If some customers fail to pay, the business can claim bad debt relief up to four years after deregistration. We can handle this for you by completing the VAT427 form online, printing it off to be signed and submitted. If you choose to handle this yourself, ensure you have all the information to hand before starting and note that a half-completed form cannot be saved.

Change of Business Structure

If your business changes structure, such as from a sole trader to a limited company, the sole trader will deregister from VAT and the new company should become VAT-registered on the same day. The new company may retain the same VAT number as the previous owner and it will also assume responsibility for any potential VAT liabilities. This includes carrying the can for any errors made in the previous four years, if the new company takes on the old VAT number. To avoid such unquantifiable risks, it is better to start afresh with a new VAT number.

Flat-Rate Scheme

Where your business has been using the VAT flat-rate scheme (FRS), it is deemed to leave that scheme the day before the VAT registration is cancelled.

Example

Ken is winding down towards his retirement after years in the pest control business, and decides to deregister from VAT with effect from 31 December 2018. He is deemed to leave the FRS on 30 December 2018, and should issue any outstanding invoices before close of business on this date.

All Ken’s business-related purchases made on 31 December 2018 will fall inside normal VAT accounting, but outside the FRS, so he can reclaim VAT charged on those items. He should make sure the invoices for these are dated 31 December, not before or after, to maximise his potential VAT saving on deregistration.

Once Ken is deregistered from 1 January 2019 onwards, he won’t be able to reclaim VAT on any purchases and must not charge VAT on his sales. He can claim bad debt relief on invoices issued for sales made before his VAT registration is cancelled, while the debt must be written off in his accounts and be at least six months old. The amount of relief claimed is calculated at the full rate of VAT applicable to the sale, not the flat rate used to calculate VAT to be paid to HMRC under the FRS.

VAT MOSS

Your VAT MOSS registration cannot continue if your business deregisters from VAT. The deregistration process for VAT MOSS must be done online and you must give HMRC at least 15 days’ notice before the end of the quarter in which notice to deregister from VAT MOSS is given. Thus, to deregister from VAT MOSS with effect from 1 January 2019, notice must be given by 15 December 2018.

If you have any questions or if you would like to discuss any of the issues raised in more detail, please contact Hannah Farmborough or call on 0207 429 4147 to be put in contact with a member of our VAT team. 

This article originally appeared on the blog of our member firm, MHA Broomfield Alexander.

Budget 2018 – Summary

Budget 2018

On Monday 29 October, Philip Hammond delivered his third Budget as chancellor. Our member firms and members of our international network have produced a range of materials that highlight the key Budget 2018 announcements and explain how they will affect you.

Videos:

Budget Review Webinar by Larking Gowen

Budget 2018 Summary by MHA MacIntyre Hudson

Budget 2018 Summary by MHA Moore & Smalley

Articles:

Capital allowances and the Budget 2018 by MHA MacIntyre Hudson

‘The era of austerity is finally coming to an end’…. but what did the 2018 Budget mean for tax policy? by MHA MacIntyre Hudson

Increased Annual Investment Allowance for 2019 – the stumbling blocks by MHA MacIntyre Hudson

Budget changes in Capital Gains Tax rules – what they might mean down on the farm by MHA MacIntyre Hudson

Tax-saving opportunities for GPs from the 2018 budget by MHA Moore & Smalley

Accounting for Rising Teaching Costs by MHA MacIntyre Hudson Education Partner, Alyson Howard

A Small Victory for Travel and Tourism by MHA MacIntyre Hudson Travel & Tourism Partner, Rajeev Shaunak

More Focus Required on Manufacturers by MHA MacIntyre Hudson Partner, Richard Powell

Changes to Employment Tax by MHA MacIntyre Hudson Senior Tax Manager, Gordon Thrower

IR35 Approach Needs a Rethink by MHA MacIntyre Hudson Employment Tax Director, Nigel Morris

Budget 2018: Three Key Measures for Business by MHA MacIntyre Hudson Tax Partner, Jay Boyce

Budget Reaction: Business Taxes by MHA Moore & Smalley

Budget Reaction: Capital Taxes by MHA Moore & Smalley

Budget Reaction: Personal Taxes by MHA Moore & Smalley

Fiscal Phil’s Pre-BREXIT Budget by MHA Broomfield Alexander

Budget Reflection by MHA Monahans

Budget 2018 Summary by Tait Walker

Budget 2018 Summary by Larking Gowen

Budget 2018 – Key Points by MHA Carpenter Box

Budget 2018: Reactions by Baker Tilly Mooney Moore

Reports:

Budget Report 2018 produced by MHA Broomfield Alexander

Budget Summary 2018 produced by MHA Carpenter Box

Budget Summary 2018 produced by Larking Gowen

Upcoming Events:

Brexit & The Budget Seminar – High Wycombe – MHA MacIntyre Hudson (9 November)

If you have any questions or would like to discuss any of the announcements with us in more detail, please contact Hannah Farmborough or call on 0207 429 4147 to be put in contact with a member of our Tax team.

EU Citizens, Brexit and Settled Status

 

As and when the UK leaves the EU, EU citizens will no longer have the direct right to enter, live and work in the UK. Therefore, if you have EU citizens working for you, you should be aware that these employees will need to obtain settled status under the EU Settlement Scheme in order to carry on working after December 2020 (unless they already have Indefinite Leave to Remain).

NB EU citizens will need to apply even if they are married to a British citizen

Eligibility

To be eligible for settled status, the EU citizen must:

  • Have been living in the UK continuously for 5 years;
  • Have started living in the UK by 31 December 2020.

EU citizens who have lived in the UK for under 5 years will generally be eligible for pre-settled status instead; this will allow them to stay in the UK for a further 5 years from the date they get pre-settled status and, after those 5 years, will be able to apply for settled status.

Applying for Settled Status

The EU Settlement Scheme is currently being trialed by EU staff working for 12 NHS Trusts and by EU students from three universities in the North-East. 1The Scheme will then be phased in towards the end of 2018 and will open fully by March 2019.  The deadline for applying is intended to be 30 June 2021 (a further six months grace after the end of the transition period).

The application form will be online. EU citizens will need to provide proof of their identity and their residence in the UK.  If the EU citizen is over 18, they will also be asked about their criminal history in the UK and overseas and will be checked against the UK’s crime databases.

The fee to apply in the majority of cases will be £65 for EU citizens aged 16 or over

What Should you do?

  • Check the numbers of EU citizen employees you have (if not known);
  • Ascertain for how long they have lived and worked in the UK;
  • Ask your EU citizen employees if they are intending to stay living and working in the UK;
  • Discuss with them the requirement to obtain settled status.

Employers’ Toolkit

A Home Office toolkit is available to enable you to increase awareness amongst your employees about the EU Settlement Scheme and how to apply for settled status; it is available at:

www.gov.uk/government/publications/eu-settlement-scheme-employer-toolkit – and includes briefing packs, posters and leaflets to assist you and your EU employees.

If you have any questions or if you would like to discuss any of the issues raised in more detail, please contact Hannah Farmborough or call on 0207 429 4147 to be put in contact with a member of our team. 

This article originally appeared on the blog of our member firm, MHA MacIntyre Hudson.

Making VAT Digital Update

We previously reported that from 1 April 2019, VAT registered businesses with a turnover above the VAT registration threshold (currently £85,000) will be required to keep digital records, and submit their VAT returns via the Making Tax Digital for Businesses (MTDfB) system.

HMRC has announced a delay to the introduction of mandatory Making Tax Digital (MTD) of six months, until 1 October 2019, for a small group of businesses with more complex requirements.

The 6-month deferral applies to businesses which fall into one of the following categories:

  • Trusts
  • Unincorporated ‘not for profit’ organisations
  • VAT divisions and VAT groups
  • Public sector entities required to provide additional information on their VAT return (Government departments, NHS Trusts)
  • Local authorities
  • Public corporations
  • Traders based overseas
  • Those required to make payments on account
  • Annual accounting scheme users

For all other businesses the commencement date for MTD is still 1 April 2019.

Either way VAT registered businesses with turnover below the registration threshold will not be mandated to use the system until April 2020 at the earliest, however, they can voluntarily choose to do so beforehand.

If you have any questions or if you would like to discuss any of the issues raised in more detail, please contact Hannah Farmborough or call on 0207 429 4147 to be put in contact with a member of our VAT team. 

This article originally appeared on the blog of our member firm, Larking Gowen.

Manufacturing Wish List for Budget 2018

Manufacturing Wish List

Richard Powell, Partner at our member firm MHA MacIntyre Hudson discusses why the Chancellor should shift from a scattergun approach and deliver more support for UK manufacturers and engineers.

Greater funding for research and development (R&D) tax credits may be a big ask in the current economic climate, but the scheme’s focus can certainly be improved. To be a real success, these reliefs need to move away from the open door approach where businesses from any sector can claim. By targeting relief at certain sectors ripe for growth, for example electric vehicle research, and companies developing automation solutions, the government could have much more impact.

We also need decisive action to encourage investment into the UK. One of the biggest concerns for manufacturing and engineering companies is the impact of Brexit on their supply chains, and many want to build their UK supply chains to counteract this. Any steps to encourage investment into the UK will help make this a reality. Whether it’s greater tax reliefs for inward investment, or a better capital allowance regime, promoting the UK as a business destination should be high on the Chancellor’s agenda.

The skills shortage is an ongoing problem for manufacturers and engineers and must also be addressed. We believe a tiered approach to the apprenticeship levy should be considered. Industries that are important to the future of the UK but are struggling to attract talent should be prioritised. Reliefs could be banded accordingly, with 100% apprenticeship funding for key industries, and lower allocations, for example 50% funding, elsewhere.

Funds are tight, and must be maximised. If we’re to deliver the infrastructure, automation and innovation this country requires to prosper post Brexit, resources must be thoughtfully allocated to the sectors where there’s most need.

If you have any questions or if you would like to discuss this in more detail, please contact Hannah Farmborough or call on 0207 429 4147 to be put in contact with a member of our Manufacturing or  Tax team.

This article originally appeared on the blog of our member firm, MHA MacIntyre Hudson.