We've recently dealt with something very simillar. Set up a new company for client with the reg office address at our address and then they disappeared without paying for the company. Since then we have received solicitors letters and various other company related post.
We sent a disengagement letter to the client and spoke to Companies House who advised us to write to the ex-client explaining that we had disengaged with them and that we were withdrawing the facility for them to use our address as reg office and giving them reasonable notice to provide a new reg office address. If no alternative address was provided Companies House said that they would commence striking off proceedures. Obviously letters re the striking off were sent to us and we just sent them to the last known address of the director and tried to contact by email and phone, all to no avail. In fact letters were sent recorded delivery and were returned 'gone away'. We also wrote to the solicitor who was chasing the client and informed them of the situation and of course all of this was copied in to the director at the only address they had given us.
Although this was a pain initially, the solicitors letters have now stopped and we have since located the director using LinkedIn and sent a very bland 'please contact us' letter to the director at their new employment so we can show that we made every effort to contact them.
Other than this I am not sure what else can be done although we have definitely learned to be more choosy about who we allow to use our address as their reg office from now on!
I don't think it's a good idea for you to be giving advice on the Italian tax position and it's unreasonable for the client to ask you to, particularly given that you have given them the sound advice of seeking out the specialist knowledge of an accountant in Italy. In my experience of dealing with clients with affairs covered by two tax jurisdictions, I always ask to deal with the foreign accountant and we work out the best advice between us (which I appreciate only works if both accountants speak the same language!). If you confirm or deny the Italian accountants advice now I would worry that this would set a precedent and you will be asked to comment on the accuracy of the Italian accountant's advice in future and I assume this won't be covered by your PI provider.
Worst case, if the client is required to report the income in both the UK and Italy, then the country in which the income arises will generally have first tax take and if there is a requirement to report the income in the other country too, then as the Innkeeper says, this should be covered by a double taxation agreement so the client will end up paying the higher of the UK and Italian tax on each source reported in both countries.
I'm surprised to hear that HMRC have no interest in the rental income, given that it's UK source income I believe it should be dealt with under the nonresident landlord scheme, unless you mean that HMRC have accepted an application under the scheme for the rent to be paid to the client gross?
As far as the personal allowance is concerned, even as a non resident, providing the male is a commonwealth or EEA citizen then he should still be entitled to a UK personal allowance.
With regards to the interest, I believe that some banks offer gross payment of interest for people who are not ordinarily UK resident on receipt of a declaration of this status on form R105 (available from HMRC website).
Should the clients suffer any UK tax, it should be dealt with fairly easily under a double taxation agreement.
Just one last thing to mention, it appears that your clients have moved around a lot so I would be a bit wary regarding the issue of domicile. You could end up with a situation where the husband is a UK dom but the wife isn't and I'm guessing that the £55K IHT exemption limit may cause some issues if the husband were to die first.
We have Iris and although it always used to be quite good, in the last year or so I have got sick of checking tax comps and finding that the Iris comp is wrong. In particular it currently has issues with capital allowances and R&D claims. Worse than this though, on calling their support we are often told that it is a problem they are aware of and it will be fixed in a future update..... Very helpful! The suggestion that we adjust the accounts / CT manually in the meantime is very frustrating and time consuming. Also had an issue in April with the Iris generated personal tax return checklists which were leaving off rental information which lead to at least one embarrassing phone call with a client, followed by a call to Iris who very helpfully said 'oh yes, we are aware of that.........'
I've no experience of Digita, but Sage Accounts Production Advanced always used to be ok (although I've not used it for a few years now) but for my money, a tax software package that gets the tax calc wrong even when the infomration you give it is right is worse than useless.
I agree that that particular message is annoying, but my vote for the most annoying HMRC message goes to the one where after you have gone through about 16 different menus (press 1 for someone pleasant but that can't help you, press 2 for someone that will pass you on to a different department who will arange for a call back at some time in the next 3 weeks etc....) finally the menus get you through to what you think is the right department, the phone rings and you wait expectantly....... Only to get the messgae 'HMRC are very busy with calls at the moment, please try again later' which is follwed by a swift click when they cut you off! That has to be the most annoying HMRC message and it is one which has cost me many chargeable units over the last few years!
I had an iPad 1 also on a 3 PAYG sim which I took to Paris last Christmas but instead of topping up my 3 sim, I purchased a new PAYG data only sim from the fist SFR shop I came to (in Cite Europe just by the Euro Tunnel exit). The SFR shop was great, they even set it up for me and I think the sim card and data cost me E20 and lasted all week. Now whenever I go to France I just top the sim card up in a mobile phone shop and pop it into my new iPad and I'm good to go.
incidentally, I never top up my 3 sim cards in the uk, rather I buy a new one every 3 months because 3 offer a deal for £20 where you can buy a sim card loaded with I can't remember how many GB, (but it's more than I have ever needed and I use my iPad a LOT) and all of the data lasts for 3 months from activation of the sim card. I have found this to be significantly cheaper and more flexible than the rolling monthly contract deals or topping up the card once it runs out!
I know it's difficult to say whether you have a passion for doing something that you haven't even tried yet, but it sounds to me like you very much enjoy being in business and are looking for some training in accountancy in order to take you up the career ladder. Although I don't mind doing the odd bit of debiting and crediting, it's not this that drives me to go to the office every morning, rather I love meeting people, seeing how their businesses run and looking for ways to help them achieve their goals and I think that this is what makes me a good accountant because at the end of the day anyone can sit at a desk and post debits and credits.
Again I'm not trying to put you off, but if you do want to train as an accountant you will most likely have a few years ahead of you on a reduced salary and be working probably in a slower paced environment than that of a busy sales team. Once you are part qualified you will have more options open to you, but only you can decide if you are willing and able to make the sacrifices required to train. Also don't underestimate the studying, it is definately doabe but shouldn't be undertaken lightly because you will need to devote a good portion of your time to it.
You are right in that a lot of captains of industry trained as accountants, but there are also a lot who didn't. I really don't belive that in a lot of those cases it's the accountancy qualification that got those peope there, rather it's their passion for working in business and their business skillls and it sounds like you have a lot of that already. Don't forget that most of those top companies have sales directors too and by the time you get to that kind of level nobody is going to be too worried about what qualifications you have.
If you do decide to study, I agree with Democratus that once you have an accountancy qualification it doesn't really matter which it is (although I think it is fair to say that you do tend to see less CIMA people in practice) but I think the important thing for you is to decide firstly whether you need to go down the this route or if you can achieve what you want to by other means.
I think it's great that you are ambitious and driven and happy to start at the bottom and work your way up, but you have to make sure that you use that drive to take you in the right direction. Firstly I think you need to decide whether you want to work in industry or practice and what you ultimately want to end up doing. If you want to work in practice I think you would be better off studying with ACCA or ICAEW rather than CIMA simply because those qualifications are geared more towards practice (although many ACCA and ICAEW qualified accountants do work in industry). It may be helpful to have a look on various big jobsites such as Reed and Hays for the type of job you realistically think you want to get in the future for the long term and then look at the qualifications that are required. This should help you decide what you need to study.
I trained in practice and studied as I worked and I honestly can't imagine trying to study without having the work experience to back it up so I would recommend that you try to find a job where study support is provided. Of course this is easier said than done and if you are currently working in sales I suspect you will need to be prepared to take a fairly sizeable salary cut. In general jobs in industry tend to be better paid than jobs in practice, but a career as an accountant is sadly no longer the guaranteed comfortable lifelong career that it was once perceived to be.
You say you are after structure and a career in accountancy can provide that to some degree but so can any other profession and lots of other jobs. I don't want to put you off as ultimately I love my job and wouldn’t really want to do anything else, but if you truly want to succeed and be a great accountant, you need to love what you do and have a passion for it, a desire for a structured career isn't enough.
If you do decide that accountancy is definitely for you, is there any scope to move into the accounts department at your existing employer, maybe on a trial basis? If not, I would write to as many businesses / practices as I could and send them copies of your CV highlighting your strengths and your commercial experience as this is something that fresh graduates don't often have and it is very valuable. I don't know if you would be considered for graduate schemes, but if I were you I would try to go direct to businesses rather than through recruitment agents because in my experience, particularly in the current climate where there appear to be more candidates than vacancies, agents only tend to bother with people they know they can place and as an unknown quantity I suspect they won't be terribly interested in trying to help you.
I hope this is of use and I wish you the best of luck
Interest only mortgages are quite common on buy to let properties, the idea being that a mortgage is taken out now on an interest only basis with the capital sum repayable in 25 years time. The hope is that at the end of the 25 years the property is worth sufficient to either remortgage it or sell it and leave the landlord with a healthy capital gain. Alternatively perhaps they envisage some other investment will repay the capital sum.
Interest is charged on the capital sum over the 25 year period and because no capital is repaid, the interest will only fluctuate depending on interest rates and the deal the mortgage is on but it will still be fundamentally charged on the capital sum borrowed.
If the interest relates to the BTL business then it should all be tax allowable.
When I do BTL I always draw up a balance sheet for my clients showing the cost of the property as an asset with a corresponding credit in the capital account and the mortgage as a credit with a coresponding debit in the capital account. The capital account then shows the equity which has been introduced to the business by the landlord. This is important because the landlord may remortgage the property up to its market value when it was first let and still obtain tax relief on that interest, regardless of what the money is used for (typically it is used to pay off the PPR mortgage). If the remortgage money is used for a personal purpose it is reflected in the accounts as a drawing on the capital account but tax relief on the interest is still available so long as the remortgage doesn't exceed the value of the property when first let. In the same way, the landlord may borrow money secured on a personal asset and providing it is introduced to the BTL business for business purposes (such as a deposit on a new property), they will be able to obtain tax relief on the interest.
If you have 5 years post qualification experience and membership of the ACCA and wanted to join the ICAEW another option might be their 'pathways to membership' scheme. It was originally due to close this December but it was annouced recently that it will remain open until December 2012. The following link gives you details http://www.icaew.com/en/join-us/members-of-other-bodies/pathways-to-membership
I too am ACCA qualified and I'm studing for the CTA but I am also considering applying to the ICAEW under this scheme as although I've never found that being ACCA has held me back, this seems like a relatively straightforward way of becoming an ACA which may be of use some time in the future.
My answers
We had something simillar
We've recently dealt with something very simillar. Set up a new company for client with the reg office address at our address and then they disappeared without paying for the company. Since then we have received solicitors letters and various other company related post.
We sent a disengagement letter to the client and spoke to Companies House who advised us to write to the ex-client explaining that we had disengaged with them and that we were withdrawing the facility for them to use our address as reg office and giving them reasonable notice to provide a new reg office address. If no alternative address was provided Companies House said that they would commence striking off proceedures. Obviously letters re the striking off were sent to us and we just sent them to the last known address of the director and tried to contact by email and phone, all to no avail. In fact letters were sent recorded delivery and were returned 'gone away'. We also wrote to the solicitor who was chasing the client and informed them of the situation and of course all of this was copied in to the director at the only address they had given us.
Although this was a pain initially, the solicitors letters have now stopped and we have since located the director using LinkedIn and sent a very bland 'please contact us' letter to the director at their new employment so we can show that we made every effort to contact them.
Other than this I am not sure what else can be done although we have definitely learned to be more choosy about who we allow to use our address as their reg office from now on!
I don't think it's a good idea for you to be giving advice on the Italian tax position and it's unreasonable for the client to ask you to, particularly given that you have given them the sound advice of seeking out the specialist knowledge of an accountant in Italy. In my experience of dealing with clients with affairs covered by two tax jurisdictions, I always ask to deal with the foreign accountant and we work out the best advice between us (which I appreciate only works if both accountants speak the same language!). If you confirm or deny the Italian accountants advice now I would worry that this would set a precedent and you will be asked to comment on the accuracy of the Italian accountant's advice in future and I assume this won't be covered by your PI provider.
Worst case, if the client is required to report the income in both the UK and Italy, then the country in which the income arises will generally have first tax take and if there is a requirement to report the income in the other country too, then as the Innkeeper says, this should be covered by a double taxation agreement so the client will end up paying the higher of the UK and Italian tax on each source reported in both countries.
I'm surprised to hear that HMRC have no interest in the rental income, given that it's UK source income I believe it should be dealt with under the nonresident landlord scheme, unless you mean that HMRC have accepted an application under the scheme for the rent to be paid to the client gross?
As far as the personal allowance is concerned, even as a non resident, providing the male is a commonwealth or EEA citizen then he should still be entitled to a UK personal allowance.
With regards to the interest, I believe that some banks offer gross payment of interest for people who are not ordinarily UK resident on receipt of a declaration of this status on form R105 (available from HMRC website).
Should the clients suffer any UK tax, it should be dealt with fairly easily under a double taxation agreement.
Just one last thing to mention, it appears that your clients have moved around a lot so I would be a bit wary regarding the issue of domicile. You could end up with a situation where the husband is a UK dom but the wife isn't and I'm guessing that the £55K IHT exemption limit may cause some issues if the husband were to die first.
Hope this is of use
We have Iris and although it always used to be quite good, in the last year or so I have got sick of checking tax comps and finding that the Iris comp is wrong. In particular it currently has issues with capital allowances and R&D claims. Worse than this though, on calling their support we are often told that it is a problem they are aware of and it will be fixed in a future update..... Very helpful! The suggestion that we adjust the accounts / CT manually in the meantime is very frustrating and time consuming. Also had an issue in April with the Iris generated personal tax return checklists which were leaving off rental information which lead to at least one embarrassing phone call with a client, followed by a call to Iris who very helpfully said 'oh yes, we are aware of that.........'
I've no experience of Digita, but Sage Accounts Production Advanced always used to be ok (although I've not used it for a few years now) but for my money, a tax software package that gets the tax calc wrong even when the infomration you give it is right is worse than useless.
I agree that that particular message is annoying, but my vote for the most annoying HMRC message goes to the one where after you have gone through about 16 different menus (press 1 for someone pleasant but that can't help you, press 2 for someone that will pass you on to a different department who will arange for a call back at some time in the next 3 weeks etc....) finally the menus get you through to what you think is the right department, the phone rings and you wait expectantly....... Only to get the messgae 'HMRC are very busy with calls at the moment, please try again later' which is follwed by a swift click when they cut you off! That has to be the most annoying HMRC message and it is one which has cost me many chargeable units over the last few years!
An alterntaive suggestion
I had an iPad 1 also on a 3 PAYG sim which I took to Paris last Christmas but instead of topping up my 3 sim, I purchased a new PAYG data only sim from the fist SFR shop I came to (in Cite Europe just by the Euro Tunnel exit). The SFR shop was great, they even set it up for me and I think the sim card and data cost me E20 and lasted all week. Now whenever I go to France I just top the sim card up in a mobile phone shop and pop it into my new iPad and I'm good to go.
incidentally, I never top up my 3 sim cards in the uk, rather I buy a new one every 3 months because 3 offer a deal for £20 where you can buy a sim card loaded with I can't remember how many GB, (but it's more than I have ever needed and I use my iPad a LOT) and all of the data lasts for 3 months from activation of the sim card. I have found this to be significantly cheaper and more flexible than the rolling monthly contract deals or topping up the card once it runs out!
Enjoy your Bordeaux!
I know it's difficult to say whether you have a passion for doing something that you haven't even tried yet, but it sounds to me like you very much enjoy being in business and are looking for some training in accountancy in order to take you up the career ladder. Although I don't mind doing the odd bit of debiting and crediting, it's not this that drives me to go to the office every morning, rather I love meeting people, seeing how their businesses run and looking for ways to help them achieve their goals and I think that this is what makes me a good accountant because at the end of the day anyone can sit at a desk and post debits and credits.
Again I'm not trying to put you off, but if you do want to train as an accountant you will most likely have a few years ahead of you on a reduced salary and be working probably in a slower paced environment than that of a busy sales team. Once you are part qualified you will have more options open to you, but only you can decide if you are willing and able to make the sacrifices required to train. Also don't underestimate the studying, it is definately doabe but shouldn't be undertaken lightly because you will need to devote a good portion of your time to it.
You are right in that a lot of captains of industry trained as accountants, but there are also a lot who didn't. I really don't belive that in a lot of those cases it's the accountancy qualification that got those peope there, rather it's their passion for working in business and their business skillls and it sounds like you have a lot of that already. Don't forget that most of those top companies have sales directors too and by the time you get to that kind of level nobody is going to be too worried about what qualifications you have.
If you do decide to study, I agree with Democratus that once you have an accountancy qualification it doesn't really matter which it is (although I think it is fair to say that you do tend to see less CIMA people in practice) but I think the important thing for you is to decide firstly whether you need to go down the this route or if you can achieve what you want to by other means.
Best of luck whatever you decide to do
I think it's great that you are ambitious and driven and happy to start at the bottom and work your way up, but you have to make sure that you use that drive to take you in the right direction. Firstly I think you need to decide whether you want to work in industry or practice and what you ultimately want to end up doing. If you want to work in practice I think you would be better off studying with ACCA or ICAEW rather than CIMA simply because those qualifications are geared more towards practice (although many ACCA and ICAEW qualified accountants do work in industry). It may be helpful to have a look on various big jobsites such as Reed and Hays for the type of job you realistically think you want to get in the future for the long term and then look at the qualifications that are required. This should help you decide what you need to study.
I trained in practice and studied as I worked and I honestly can't imagine trying to study without having the work experience to back it up so I would recommend that you try to find a job where study support is provided. Of course this is easier said than done and if you are currently working in sales I suspect you will need to be prepared to take a fairly sizeable salary cut. In general jobs in industry tend to be better paid than jobs in practice, but a career as an accountant is sadly no longer the guaranteed comfortable lifelong career that it was once perceived to be.
You say you are after structure and a career in accountancy can provide that to some degree but so can any other profession and lots of other jobs. I don't want to put you off as ultimately I love my job and wouldn’t really want to do anything else, but if you truly want to succeed and be a great accountant, you need to love what you do and have a passion for it, a desire for a structured career isn't enough.
If you do decide that accountancy is definitely for you, is there any scope to move into the accounts department at your existing employer, maybe on a trial basis? If not, I would write to as many businesses / practices as I could and send them copies of your CV highlighting your strengths and your commercial experience as this is something that fresh graduates don't often have and it is very valuable. I don't know if you would be considered for graduate schemes, but if I were you I would try to go direct to businesses rather than through recruitment agents because in my experience, particularly in the current climate where there appear to be more candidates than vacancies, agents only tend to bother with people they know they can place and as an unknown quantity I suspect they won't be terribly interested in trying to help you.
I hope this is of use and I wish you the best of luck
Interest only mortgages are quite common on buy to let properties, the idea being that a mortgage is taken out now on an interest only basis with the capital sum repayable in 25 years time. The hope is that at the end of the 25 years the property is worth sufficient to either remortgage it or sell it and leave the landlord with a healthy capital gain. Alternatively perhaps they envisage some other investment will repay the capital sum.
Interest is charged on the capital sum over the 25 year period and because no capital is repaid, the interest will only fluctuate depending on interest rates and the deal the mortgage is on but it will still be fundamentally charged on the capital sum borrowed.
If the interest relates to the BTL business then it should all be tax allowable.
When I do BTL I always draw up a balance sheet for my clients showing the cost of the property as an asset with a corresponding credit in the capital account and the mortgage as a credit with a coresponding debit in the capital account. The capital account then shows the equity which has been introduced to the business by the landlord. This is important because the landlord may remortgage the property up to its market value when it was first let and still obtain tax relief on that interest, regardless of what the money is used for (typically it is used to pay off the PPR mortgage). If the remortgage money is used for a personal purpose it is reflected in the accounts as a drawing on the capital account but tax relief on the interest is still available so long as the remortgage doesn't exceed the value of the property when first let. In the same way, the landlord may borrow money secured on a personal asset and providing it is introduced to the BTL business for business purposes (such as a deposit on a new property), they will be able to obtain tax relief on the interest.
If you have 5 years post qualification experience and membership of the ACCA and wanted to join the ICAEW another option might be their 'pathways to membership' scheme. It was originally due to close this December but it was annouced recently that it will remain open until December 2012. The following link gives you details http://www.icaew.com/en/join-us/members-of-other-bodies/pathways-to-membership
I too am ACCA qualified and I'm studing for the CTA but I am also considering applying to the ICAEW under this scheme as although I've never found that being ACCA has held me back, this seems like a relatively straightforward way of becoming an ACA which may be of use some time in the future.