Monthly Archives: November 2012

Don’t Lose your Child Benefit

From 7 January if one parent in a household earns more than £50,000 he or she will have to pay the new child benefit tax , regardless of which parent is claiming the child benefit, and irrespective of the income earned by the second parent. For those earning over £60,000 the amount of the charge is the same as the Child Benefit received.

How to keep your Child Benefit!

Income used to calculate the tax is defined as net adjusted income, to arrive at the net adjusted figure you deduct any gross pension contributions made.

For example:

Andrew has a taxable income of £55,000 and his wife Beth £20,000, they have two children which gives Beth Child Benefit of £1,752.40.

Since Andrew’s income is £5,000 above the limit, he will face a tax charge of 50% of £1,752.40 (£876.20).  However, if Andrew makes a net pension contribution of £4,000 into his personal pension plan this will be grossed up to £5,000.  His net adjusted pay will be reduced to £50,000 and the tax charge will not apply!

By paying £4,000 into his pension, Andrew has saved £876.20 and through his tax return can claim an additional £1,000 tax relief as a higher rate tax payer.  So his pension contribution has cost him £4,000 – £1,000 – £876 =£2,124 and he has saved £5,000 towards his retirement!

Other things to consider are;

  • Buying extra holiday through salary sacrifice
  • Buying childcare vouchers
  • Donating money to charity through gift aid
  • Equalising income between spouses
  • Crystalising income tax losses

For further information or to review your pension or retirement planning, contact Antony Keen on 01254 679138 or email antony.keen@pmm.co.uk

For general advice on taxation issues, contact Jane Parry on 01254 679131 or email jane.parry@pmm.co.uk 

Changes to Audit Exemption Requirements

On October 1st, the Department of Business Innovation and Skills brought in new rules that meant that small businesses no longer need an audit if they meet two out of the three qualifying criteria for small company accounts:

  • Fewer than 50 employees
  • Balance sheet total: no more than £3.26m
  • Turnover below £6.5m.

In addition to this, subsidiary companies will no longer need mandatory audits if their parent companies guarantee their liabilities and dormant subsidiaries – up to 67,000 in number – will not need to prepare and file annual accounts. In most cases, these changes take immediate effect.

These changes are part of the Government’s wider drive to reduce unnecessary burdens on UK businesses and it is hoped that it will help to save them millions every year, freeing them up to expand and grow their business.

Our business services team have been working with companies affected by the change and have successfully achieved cost savings of between 25% and 40% of fees for them. If you would like an informal discussion to find out if we can save you money, contact us on 01254 679131.

Top Marks Again for Lucy

For the second year running 22-year-old trainee accountant Lucy O’Gorman is to be honoured at a special dinner after scoring the best examination mark in the North West.

Lucy sat the taxation paper in the summer and scored an impressive 76% – more than any other student in the region.

This prompted the Institute of Chartered Accountants in England and Wales to write to her personally and to invite her to a celebratory dinner to be held in Preston next month.

Last year, Lucy was awarded the prize for scoring the top marks in the region for the financial accounting examination.

Lucy said: “I was thrilled to find out that I’d got the best exam results in the North West for the second year running. I love my work and it’s important to me that I do well in my career, I studied hard to pass my exams with good marks – but to come out on top again is amazing.

Managing partner Stephen Anderson said: “The whole PM+M team is delighted for Lucy. She works hard and is loved by her clients – these examination marks are a testament to her hard work.

“We are very proud to have her as part of our team. We encourage all our staff to be the very best version of themselves that they can be and we love taking the time to celebrate achievements.”

PM+M 2012 Christmas Present Appeal

In 2010 we launched our Christmas present appeal where we asked our staff, clients and friends to consider donating a Christmas present for local vulnerable children. We are running the appeal again this year.

Over the past two years, thanks to the overwhelming generosity of you all, we have donated hundreds of toys and gifts to our local Children’s Services team who pass them on to struggling families. For some of these children, this may be the only present they get which we think you will agree is a rather sobering thought which helps puts things into perspective.

As in previous years, we kindly ask you that you please consider sparing a little of your time and cash to donate a gift to this extremely worthwhile local cause. Gifts can be dropped off at either our Blackburn or Burnley offices (for addresses click here ) by Friday 7th December, so that they can be distributed in time for Christmas.

We do hope you will join us in this extremely worthwhile venture to help put a smile on a local child’s face this Christmas.

Gift ideas:

  • Gifts purchased should be to the value of around £10
  • All gifts must be new
  • Gifts can be brought wrapped or unwrapped
  • Wrapped gifts should be marked with the gender and age range
  • Items are needed for all ages of children, from newborn to 16
  • For younger children, suitable gifts could be soft or educational toys, clothes, games equipment (such as footballs, basketballs), dolls or action figures and books
  • For teenagers, suitable gifts include gift tokens/gift cards, CDs, gadgets, jewellery and toiletries or make-up.
  • Family gifts of board games are always welcome.

Please do not bring gifts containing confectionery or alcohol

If you would like to donate a gift, please contact Claire Jewsbury or Lorraine Cade on 01254 679131