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Changes to R&D Tax Relief scheme

Posted on: January 26th, 2015 by Denise Roberts No Comments
Denise Roberts, Tax Director, Broomfield & Alexander

Denise Roberts, Tax Director, Broomfield & Alexander

Is your business an engineering or manufacturing company which produces “bespoke” or “first in class” products?  If so, we need your help to try to persuade HMRC not to implement a change which could adversely affect your business by completing our brief survey and giving us your feedback

In the Autumn Statement HMRC announced that they propose to change the R&D tax relief claims system, to exclude the cost of materials included in the bespoke items (or first in class items) from any R&D Tax Relief claims from 1 April 2015 if those items are then sold to customers.

Under the current law, it is possible to include within R&D Tax Relief claims the costs of materials consumed in the development process which are then included in the item sold.

For development projects relating to high value items such as offshore equipment, vehicles or other plant and machinery which is developed and then sold these costs can make up a sizeable part of the R&D Tax Relief claims made by engineering companies.

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Community Asset Transfers = CAT & VAT

Posted on: January 23rd, 2015 by Liz Mounfield No Comments
Liz Maher, Director, Centurion VAT

Liz Maher, Director, Centurion VAT

The Centurion VAT team has been supporting a number of local authorities, and the subsequent Trust bodies established, in addressing the VAT issues that will directly impact on the feasibility of transferring out council run Leisure and Cultural services to separate Trust management.

So when I saw Empowers Blog piece on the next round of CAT funding announced from the start of 2015 it caught my eye.

The transfer projects we’ve worked on cover quite wide ranging VAT impact issues: sporting services provided by a local authority for example are excluded from the VAT Exemption treatment so a council charges VAT on this aspect. The same supply made by a separate Trust body with charitable status would attract the VAT exemption treatment. “So what I hear you say” – well the basic VAT rules will not allow someone to recover the VAT they have incurred on costs which are then used to support an activity which generates VAT Exempt income – not good news for budgets!

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International market entry strategies

Posted on: January 20th, 2015 by Liz Mounfield No Comments
Andrew Milloy, Visionary Consultants

Andrew Milloy, Visionary Consultants

There are many ways in which a Company can find a route to an overseas market. There is no single market entry that works for all International markets. For many businesses direct exporting may be the best strategy while in another it may be suitable to set up a joint venture and in another it may be effective to license the manufacturing. Many factors will determine the choice of strategy, including, but not limited to, tariff rates, the degree to which you need to adapt your product, marketing and transportation costs. These factors may well increase cost to market but it would be expected that the increase in sales will offset these costs.

The following Market entry strategies can be regarded as the main options for companies:

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Year end tax planning guide (2014-15)

Posted on: January 20th, 2015 by Leighton Reed No Comments
Leighton Reed, Director, Broomfield & Alexander

Leighton Reed, Director, Broomfield & Alexander

Our year end guide summarises some key tax and financial planning action points which should be considered prior to the end of the tax year on 5th April 2015.

The planning points set out in this guide are all statutory reliefs which can be used as Parliament intended to reduce a range of taxes without falling foul of the new legislation.

Download the Broomfield & Alexander Year End Tax Planning Guide (2014-15) here.

HMRC’s MOSS came into effect on 1st January, 2015…

Posted on: January 16th, 2015 by Leighton Reed No Comments

The 1st January 2015 has been and gone and suddenly HMRC’s “Mini One Stop Shop” (MOSS) is the topic of conversation!

Early reports suggest that the HMRC registration machine is struggling to keep pace with the late demand. Some traders are stopping direct sales to the EU and the position on platforms and marketplaces is confusing. There is evidence emerging that some member states are interpreting the rules differently and some, such as Italy, have missed the staging date altogether.

America appears to have woken up and there are groups lobbying against the requirement to account for EU tax. Other countries such as Japan, South Africa and Australia are looking at dates in 2015 to implement the same system. Watch this space!

If you would like to discuss your concerns please contact us on tax@broomfield.co.uk and we would be happy to advise further.

International marketing: pricing issues

Posted on: January 15th, 2015 by Liz Mounfield No Comments
Andrew Milloy, Visionary Consultants

Andrew Milloy, Visionary Consultants

Why is international pricing so important?

For many established companies successful in their domestic markets they have developed a pricing strategy that works well and which has developed through experience of the market and competition.

However, an international pricing strategy should be viewed differently for many reasons. For companies entering an overseas market for the first time it’s likely that they will be an unknown entity. They will be unable to call on good reputation and goodwill. In many instances the product will have to be re-packaged, re-branded or even re-engineered slightly to ensure it’s successful on the new market. Given this and other factors a company’s cost structure is likely to be different and prices will need to take this into account.

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SORP 2015 bite size guidance: Disclosure of trustees & staff remuneration, related party and other transactions

Posted on: January 15th, 2015 by Joanne Taylor No Comments
Joanne Taylor, Senior Charities & Not for Profit Manager, Broomfield & Alexander

Joanne Taylor, Senior Charities & Not for Profit Manager, Broomfield & Alexander

Welcome to our series on SORP 2015 where the specialist charities and not for profit team at Broomfield & Alexander will bring you bite size guidance on the changes that SORP 2015 will bring to your organisation.

The new SORP and its predecessors recognised that the disclosure of certain transactions are important within a charity for stewardship purposes  and also for providing assurance that the charity is operating for the public benefit and that its trustees are acting in the interests of the charity and not for private benefit.

The new SORP requires that disclosures must be made for transactions involving trustees, de-facto trustees, related parties, staff remuneration and ex-gratia payments and must  always be regarded as material regardless of size.

Much of this guidance is not new, but the new SORP provides more detailed guidance to address issues that have arisen since the last in SORP 2005.

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Impact of the Autumn Statement on Corporate Finance

Posted on: January 12th, 2015 by Katherine Broadhurst No Comments
Katherine Broadhurst , Assistant Manager, Corporate Finance, Broomfield & Alexander

Katherine Broadhurst , Assistant Manager, Corporate Finance, Broomfield & Alexander

Now that the run up to the election seems to have started properly, we thought it would be a good time to recap on 3 budget changes set out in the Chancellor’s Autumn Statement which could have an impact on the availability of finance in the economy.

Restriction on historical tax losses

Significant losses were made in the banking sector as a result of the recession and provisions against compensation due as a result of mis-selling scandals. Being able to relieve all of these losses against future profits would have meant banks may not have paid any tax for a significant period of time. As a result, the government has announced that from next year, banks will only be able to use historic losses to relieve 50% of their profits.

The Office for Budget Responsibility has estimated that changes to the tax regime in this way could lead to banks paying an extra £700m extra a year this decade. Whilst this could have a negative impact on the lending activity undertaken by banks as they will have less cash available, the government has announced a number of schemes that will reintroduce some of this tax back into the economy through support for SMEs seeking funding.

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SORP 2015 bite size guidance: Allocating Costs by Activity

Posted on: January 12th, 2015 by Claire Thompson No Comments
Claire Thompson, Charities and Not for Profit Assistant Manager, Broomfield & Alexander

Claire Thompson, Charities and Not for Profit Assistant Manager, Broomfield & Alexander

Welcome to our series on SORP 2015 where the specialist charities and not for profit team at Broomfield & Alexander will bring you bite size guidance on the changes that SORP 2015 will bring to your organisation.

In this blog post we look at how costs should be allocated by activity in the Statement of Financial Activities (Module 8) – note that the approach taken to this topic is the same in both SORPs.

General Principles:

The SOFA must distinguish between expenditure incurred on charitable activities which contribute to furthering the charity’s aims and purposes and those undertaken to raise funds.

A charity’s SOFA or related notes should provide an analysis of a charity’s significant activities in a way that is relevant to both the charity and the user of the accounts.

Significant activities are those which due to their scale or importance are key to the charity in meeting its aims and objectives. The activities should also be consistent with the significant activities noted in the trustees’ annual report.

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HMRC’s latest tax campaign targets solicitors

Posted on: January 9th, 2015 by Seamus Gates No Comments
Seamus Gates, Director, Broomfield & Alexander

Seamus Gates, Director, Broomfield & Alexander

During December, HMRC launched their latest tax campaign and this time it is aimed at solicitors. The Solicitors Tax Campaign gives solicitors working in a partnership or company, or as an individual, the chance to tell HMRC about any income they haven’t declared.

Since 2007, HMRC campaigns have collected over £596 million in tax from people approaching them voluntarily together with a further £338 million from a large number of follow-up activities. There are a number of criminal investigations already underway and so far eight people have been convicted of cheating the public revenue, with custodial sentences totalling in excess of 10 years handed down and leading to the recovery of £593,000.

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Latest From The Blog


Changes to R&D Tax Relief scheme

Denise Roberts, Tax Director, Broomfield & Alexander

Denise Roberts, Tax Director, Broomfield & Alexander

Is your business an engineering or manufacturing company which produces “bespoke” or “first in class” products?  If so, we need your help to try to persuade HMRC not to implement a change which could adversely affect your business by completing our brief survey and giving us your feedback

In the Autumn Statement HMRC...

Read more

Community Asset Transfers = CAT & VAT

Liz Maher, Director, Centurion VAT

Liz Maher, Director, Centurion VAT

The Centurion VAT team has been supporting a number of local authorities, and the subsequent Trust bodies established, in addressing the VAT issues that will directly impact on the feasibility of transferring out council run Leisure and Cultural services to separate Trust management.

So when I saw Empowers Blog piece on the next round of...

Read more