The point of the EU relaxation is not that accounts will not need filing at Companies House, but that micro-entities will not need to prepare accounts that comply with Companies Acts/GAAP - the extent that this requirement is relaxed will depend on the individual countries. Maybe HMRC will argue that GAAP accounts are needed for corp tax but they may be arguing with a de-regulating government.
The simplification involved when "ministers reached an agreement in Brussels" (AWeb 3.6.11), gives much more flexibility than just not sending a copy of the abbreviateds to CH.
I think that the proposals allow member countries to go much further - from a 26.4.11 letter from Philip Johnson, President of FEE, (Federation of European Accountants), to Hungarian representatives: "The current proposal to allow micro-entities to apply cash based accounting is in our opinion a backwards step" http://www.fee.be/currentissues/default.asp?content_ref=1382&library_ref=4&category_ref=73
In other words, a "reduce the regulatory burden" government could move the goalposts such that a Receipts & Payments is all that is required. If so a loty of us AWeb correspondents will be seeking alternative careers.
You are right - but I am sure that the results will be productive for HMRC and so your compliant clients pay the price in terms of time lost dealing with HMRC.
BUT There is a culture in some of these trades that staying, illegitimately, unregistered is acceptable, that registration is somehow a matter of choice - I have clients who grind their teeth at being materially over the threshold and my telling them that they have to stay registered; they should eventually feel that my advice was right as some of their unegistered competitors face penalties.
In fact, some of these clients gain from VAT, as long as they are as busy as they could be anyway, the Flat Rate Scheme can be a "nice little earner" for them.
Rebecca, The extra cost to the contractor does not come form time spent calculating deemed salary, PAYE arising & P35 completion - they are easy tasks if the decision on IR35 caught/not caught has been taken. The cost in terms of fees, for advice on IR35 applicability is, in my view, less than the professional services warrant because of the price competition in the contractors' market.
The real cost is the burden of worry that contractors feel. even after extensive discussion with us accountants the decision on IR35 status rests with the contractor and the stress this, and the tax bill that could hit them Dragonfly-style is intense.
A related question. At some stage last year there was publicity that employers who were late with their monthly/quarterly returns, (ie paying over the PAYE to HMRC), would be liable to penalties. Previously this has only applied to y/e returns, with the only adverse effect, (apart from potential black marks on the HMRC risk analysis), of late paying over being interest if paid after 19th April and collection action from Recovery offices.
Was this quietly dropped or is it a bombshell HMRC are keeping in the cupboard to get out after 19th May for Mth 1 2010-11 payments?
Posting on this old thread in the hope that you are to be updated when thee are new postings.
Your proactice/e-mail software mix is just what I am switching to, have you been able to link/synchronise between VT and or taxcalc and outlook for contacts etc?
if you can help/advise on that at all I'd be very grateful: [email protected]
My answers
Companies Act Accounts
Kalden,
The point of the EU relaxation is not that accounts will not need filing at Companies House, but that micro-entities will not need to prepare accounts that comply with Companies Acts/GAAP - the extent that this requirement is relaxed will depend on the individual countries. Maybe HMRC will argue that GAAP accounts are needed for corp tax but they may be arguing with a de-regulating government.
IS this the extent of the proposals?
The simplification involved when "ministers reached an agreement in Brussels" (AWeb 3.6.11), gives much more flexibility than just not sending a copy of the abbreviateds to CH.
I think that the proposals allow member countries to go much further - from a 26.4.11 letter from Philip Johnson, President of FEE, (Federation of European Accountants), to Hungarian representatives: "The current proposal to allow micro-entities to apply cash based accounting is in our opinion a backwards step" http://www.fee.be/currentissues/default.asp?content_ref=1382&library_ref=4&category_ref=73
In other words, a "reduce the regulatory burden" government could move the goalposts such that a Receipts & Payments is all that is required. If so a loty of us AWeb correspondents will be seeking alternative careers.
Could not agree more
Kalden,
I could not agree more - how can I tell a client that he must comply with the law when others, who are fraudsters, get off so lightly.
Box is not Badges of Trade
The "box on the right" does not give guidance ont he badges of trade but on best practice if it is a trade.
Consistently below the threshold
Andrew,
You are right - but I am sure that the results will be productive for HMRC and so your compliant clients pay the price in terms of time lost dealing with HMRC.
BUT There is a culture in some of these trades that staying, illegitimately, unregistered is acceptable, that registration is somehow a matter of choice - I have clients who grind their teeth at being materially over the threshold and my telling them that they have to stay registered; they should eventually feel that my advice was right as some of their unegistered competitors face penalties.
In fact, some of these clients gain from VAT, as long as they are as busy as they could be anyway, the Flat Rate Scheme can be a "nice little earner" for them.
"Accounts" = tax comp
We will hear more this afternoon presumably.
I do not think that are talking about Full / Abbrev at all.
What I think they are meaning is that the really small companies will only have to produce "tax accounts" - ie no GAAP/CA2006 acounts at all.
Finding the SA400
I challenge anyone navigating through the HMRC "Starting in Business" section to find the SA400.
IR35 cost
Rebecca, The extra cost to the contractor does not come form time spent calculating deemed salary, PAYE arising & P35 completion - they are easy tasks if the decision on IR35 caught/not caught has been taken. The cost in terms of fees, for advice on IR35 applicability is, in my view, less than the professional services warrant because of the price competition in the contractors' market.
The real cost is the burden of worry that contractors feel. even after extensive discussion with us accountants the decision on IR35 status rests with the contractor and the stress this, and the tax bill that could hit them Dragonfly-style is intense.
Monthly Returns
A related question. At some stage last year there was publicity that employers who were late with their monthly/quarterly returns, (ie paying over the PAYE to HMRC), would be liable to penalties. Previously this has only applied to y/e returns, with the only adverse effect, (apart from potential black marks on the HMRC risk analysis), of late paying over being interest if paid after 19th April and collection action from Recovery offices.
Was this quietly dropped or is it a bombshell HMRC are keeping in the cupboard to get out after 19th May for Mth 1 2010-11 payments?
D T Young
Posting on this old thread in the hope that you are to be updated when thee are new postings.
Your proactice/e-mail software mix is just what I am switching to, have you been able to link/synchronise between VT and or taxcalc and outlook for contacts etc?
if you can help/advise on that at all I'd be very grateful: [email protected]