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Nimbus

By Nimbus

August 30, 2012

Seed Enterprise Investment Scheme

August 30, 2012 | By |

Seed Enterprise Investment Scheme

With the banks still not lending to small businesses, are there other forms of external investment? The government has introduced the Seed Enterprise Investment Scheme (SEIS), which will sit alongside the existing Enterprise Investment Scheme (EIS), to promote investment in the smaller, early stage companies that would normally be overlooked by the EIS investor.

Does your company qualify?

The company must have fewer than 25 employees and assets of less than £200,000.  It can raise a maximum of £150,000 through the scheme, but no investor can receive more than 30% of the company.  The trade being carried on by the company at the date of issue of the relevant shares, must be less than two years old. The majority of trades are included, however there are exclusions and some other conditions to be aware of. More information is available at  http://www.hmrc.gov.uk/seedeis/how-to-qualify.htm.

How does the investor benefit?

The investor will receive 50% of the cost of the shares off his personal income tax bill, up to a maximum annual investment of £100,000. For the 2012/13 tax year only, if the investor has chargeable gains, realised on any assets in the year, he can also invest those in a qualifying SEIS in the same year (up to £100,000).  In both cases, if the shares are held for more than 3 years, on disposal there is no capital gains tax to pay. Therefore, it is possible to reduce your income tax bill by £50,000 and completely avoid capital gains tax on £100,000, so the maximum tax saving is £78,000 for a £100,000 investment. For more details and other conditions please visit  http://www.hmrc.gov.uk/seedeis/invest.htm

What do I do next?

Obviously you need to find investors; therefore you need an attractive proposition and a detailed business plan.  Once you have that in place, one of our professionals can help you obtain advance assurance from HMRC that your company will qualify for SEIS, something investors will insist on this prior to parting with their money. You also need to complete Form SEIS1 after the first 4 months of trading, or if not yet trading once you have spent 70% of monies raised, something we can help you with.

If you would like more information about the Seed Enterprise Investment Scheme, or any other approved tax saving opportunities, please get in touch http://www.nimbusaccounting.com/contact-us/.  Nimbus Accounting staff are all qualified accountants and have a specialist knowledge of SME accounting and taxation. We have offices in Brighton & Hove and offer face to face meetings in Sussex and virtual meetings to the rest of the UK. 

Tax
Nimbus

By Nimbus

August 29, 2012

Getting ready for RTI

August 29, 2012 | By |

You have probably heard that HMRC are introducing a new method of PAYE reporting. Historically HMRC would receive either monthly or quarterly PAYE payments from employers and would only be able to reconcile these once the employer submitted their year-end return (Form P35). In the past the employers in financial difficulty were able to use HMRC as a creditor, by not paying the PAYE due and HMRC would not be aware of this debt.

HMRC have now introduced Real Time Information (RTI), not quite up to the minute, but real time information month by month. Therefore, from April 2013 or October 2013 (depending on the size of your business) all employers are required to submit their PAYE data to HMRC on a monthly basis. The payment dates remain the same, either monthly or quarterly, depending on the size of your PAYE liability.

There are potentially a few losers with the introduction of RTI. Students will unfortunately lose the ability to earn their full personal allowance in their summer holidays without being taxed! The good news is they will be able to claim back the tax, but will need to complete a Form P50 after their summer job has finished.

So what is all the fuss about? As with all changes in procedures there is a reluctance to adopt something new. At Nimbus Accounting we are well prepared for the change. Our payroll software will automatically transmit the necessary information to HMRC at a click of the button. There are firms, as always, trying to scare clients that there will be extra administration. If this sounds familiar, pick up the phone and give us a call at Nimbus Accounting, we will give you honest straight forward advice in plain English.

If you are based in the Brighton & Hove or Sussex area and want to discuss this, or any other matter affecting your business, please don’t hesitate to give us a call on 01273 782 742. Nimbus Accounting staff are all qualified accountants and have a specialist knowledge of SME accounting and taxation.

PAYE

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