How to set up and run a small business

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Small business accounting software has changed massively in recent years. Thankfully, the advent of cloud computing has consigned the days of buying book-keeping software in a box and installing it on your own computer to history.

Nowadays, start-ups and small business can choose from a whole host of online accounts software packages. The technology helps to ease the pain of book-keeping and accounts for small business owners and provides a range of other benefits too.

But with so many different web-based accounting solutions out there, how do you choose the right system for you and your business?

That’s where this guide comes in. If you follow the advice, and ask these questions, you should be able to quickly narrow down the field, and ultimately choose the best online accounting software for your needs.

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The area of tax for small businesses is not straightforward, in fact it can be a real minefield for the unwary. However if you take a little time, and work with your accountant, it’s usually possible to find ways to save some tax.

To help you think about ways you and your business could pay less tax, here are 10 tax-saving tips. They are designed to make you stop and think. Are you doing everything you can do to save tax? Is your advisor helping you to do so?
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ByteStart has teamed up with Crunch Accounting to bring you a very special offer.
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When you buy certain new equipment, invest in buildings or research and development, you can deduct a proportion of the cost from your taxable profits and reduce your business tax bill, through Capital Allowances.

Capital Allowances take the place of commercial depreciation, which is not allowed for tax. Using them effectively can be a huge boost to your business, especially if you need to invest to fund growth.

Here’s a look at the main elements of the various capital allowances schemes and how your business can qualify to take advantage of them. Continue…

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Running your own business sometimes seems to be a series of successes followed by setbacks.

You win a big client, then lose an existing client. You hire the perfect employee and their current employer offers them more money to stay. You make a nice fat profit, and the taxman comes along and takes 20 per cent of it! Talk about three steps forward, two steps back.
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A staple of business life for decades, the spreadsheet was adopted on a mass scale in the late 1980s and 90s alongside desktop computers. The fact that it is still used today is testament to the fact that it really was one of the killer apps of its time.

Increasingly, however, in the age of cloud-based software and connected devices, the spreadsheet and PC-reliant tools like it are being rapidly overtaken by advances in technology, leaving legacy business users at a competitive disadvantage.

Switching from spreadsheets to cloud accounting software allows small business owners to access more up-to-date figures for sales and cashflow, and view analysis and reports on a broad selection of other essential business performance indicators.

With a wider range, and more current information to-hand, cloud accounting can help business owners to make quicker and better-informed decisions.
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Are you a self-employed individual? Do you have to travel on business, and does that travel ever entail an overnight stay away from your home?

Do you know exactly which of the travel and accommodation expenses you can legitimately claim back? If you get it wrong, you could pay too much tax, or worse still find yourself in trouble with HMRC for paying too little tax!

To help you get it right, here’s an explanation of the rules regarding travel and accommodation expenses for sole traders. It explains what you can, and can’t, include as legitimate costs in your business accounts. Continue…

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If you are a limited company shareholder, you may have to pay personal tax on any dividend income you receive. This article outlines how company dividends are taxed.
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If you need to submit a Self-Assessment Tax Return (SATR) it’s imperative you get it in on time and free of any mistakes.

There are penalties for not submitting your tax return on time and you may have to pay a fine if HMRC deem you have not taken enough care in completing it.

With regard to the deadlines, paper tax returns need to be filed with HMRC by 31 October and tax returns submitted online by 31 January. So, if you complete your tax return online, you get a few extra months.

This article explains how to get started with your tax return, and how to avoid common mistakes that people make on their self assessment tax return.
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Cash flow is arguably one of the most important parts of managing your small business. So any tax incentives, or potential tax relief opportunities which are available should always be grabbed with both hands.

But then, you often hear stories about how great these incentives and reliefs are, only to find that there are lots of conditions and qualifying factors, which mean you can’t actually benefit from them.

Thankfully, Research and Development tax relief isn’t like that. As long as you are genuinely investing in R&D projects, there’s a great opportunity to cut your corporation tax bill, or even get tax credits from HMRC in the form of an actual cheque!

So, what do you need to know about Research & Development Tax Relief Incentives? Continue…

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If you are dealing with a new customer or supplier and want to check whether the VAT registration number (VRN) they have supplied is valid, there are two ways you can do so.

One method is to call the HMRC VAT Helpline, the other is to use the online VAT Information Exchange System (VIES) run by the European Commission.
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National Insurance is a deduction from earnings, set up originally to fund various State benefits such as the NHS, the State pension and other welfare-related schemes.

In reality, it is just another tax. In fact, as standard income tax rates have remained constant for many years, NI rates have soared.

In this guide we look at how National Insurance works, and what your National Insurance Contributions (NICs) will be as a small business person. The guide has been updated with the 2014/15 tax year NIC rates. Continue…

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Most small business owners say that their accountant is their most valuable advisor – a good accountant will keep your books in order, help with tax planning, and will ensure that you meet all your tax deadlines. Here are some tips from the ByteStart team to help you choose the best accountant:
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In this concise guide, we look at the taxes you will encounter if you start your own business as a sole trader, and other things you should bear in mind before taking the plunge and becoming self employed.
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Few people start a new business so they can do paperwork. Spending time adding up receipts or pushing invoices around a desk is nobody’s idea of fun – unless you’re starting up as a book-keeper or accountant!

Unfortunately it’s a necessary evil and something you need to stay on top of in your new business. Being disorganised and putting off paperwork just isn’t an option.

Her Majesty’s Revenue & Customs (HMRC) will fine you if you’re late getting essential information to them. And the longer you leave it, the worse the problem gets. So here’s what every small business owner needs to know about book keeping.
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Small businesses, and the individuals who run them, are subject to a wide array of taxes – from Corporation Tax to National Insurance. Here is an overview of the main UK business taxes you will encounter as a business owner, together with links to our more in-depth guides.
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With the plethora of tax rates, thresholds and allowances changing every year, here is ByteStart’s summary of the main tax rates, tax bands, and allowances for the 2014/2015 tax year. We focus on the figures that are of relevance to business owners.
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HMRC have provided a range of special schemes that apply to smaller businesses. They are designed to reduce administration, but also (in some cases) to assist cash flow.
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This second guide in ByteStart’s 3-Part VATChat series; outlines how VAT registered businesses should charge VAT on their goods and services, and how to reclaim VAT on purchases and costs.
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In the first in a short series of Value Added Tax bulletins for small businesses, Les Howard looks at what VAT is, and when you must register your business.
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VAT registration – when should you register for VAT?

April 6, 2014

Your business should register for VAT if your “taxable supplies” over the past 12 months has exceeded the VAT registration threshold. From April 2015, the VAT registration threshold is £82,000 (previously it was £81,000).

ByteStart’s 60-second guide to Value Added Tax (VAT) for start-ups and small businesses

April 1, 2014

Value Added Tax (VAT) is a tax on the final consumption of certain goods and services in the home market but is collected at every stage of production and distribution. Most business-related goods and services will therefore be subject to VAT.

Budget 2014 – Summary of main points of interest for small business owners

March 20, 2014

Following George Osborne’s delivery of the 2014 Budget, here is a summary of the main tax changes and announcements that will be of interest to those that own and run small businesses:

Running a home office – can you claim on expenses?

January 29, 2014

As more and more people choose to work from home, the question of how you can reclaim any home office expenses is frequently asked. The general HMRC rule for claiming tax relief on business expenses is that you can only reclaim costs that have been ‘wholly and exclusively’ incurred in connection with your trade.

Top 10 tax tips for small businesses

January 15, 2014

Tax isn’t the most exciting part of running your own business, but it is an issue that you will have to tackle at some point. To help you to quickly get to grips with the subject, here are some handy tax tips based on our findings of working with small businesses over the past decade, […]

How to get the best value from your accountant

November 12, 2013

In this article, we look at the role accountants play, and how to ensure you choose the right firm for your business.

What is a balance sheet and how do you create one?

April 29, 2013

If you choose to set up a limited company when you start your business, there’s a lot more paperwork involved. It’s one the downsides of going limited (the biggest upside of course being that you limit your liability should the business go under). One of the many pieces of paperwork you will have to generate […]

Summary of personal tax changes from 6th April 2013

April 6, 2013

Many rates and allowances changed on 6th April 2013, as the new personal tax year began. This year, the RTI (Real Time Information) payroll rules also came into effect.

Staying on top of your company accounts – Book-keeping Dos and Don’ts

April 4, 2013

Accurate bookkeeping is a necessary evil when you run your own business. There are three reasons you need to be on top of the money coming in and going out. HMRC will need information from you at some point (whether you are a sole trader or run a limited company); you need to know if […]

Tax rates for small business owners – 2013/14

March 26, 2013

Following the 2013 Budget, here is our summary of the main tax rates, tax bands, and allowances for the 2013/2014 tax year, with particular reference to data which will affect the typical small business owner. If you are looking for figures for the 2014/15 tax year, you will find them in ByteStart’s guide to the […]