Alexander Sloan celebrates DFK’s 60th Anniversary

The DFK network is celebrating its 60th anniversary this year.

Alexander Sloan is celebrating global independent accountancy association DFK international’s 60th anniversary. 

We are proud to be a member of DFK International – an association which benefits both the business and our clients. DFK enables us to support our clients to do business internationally, referring them to like-minded firms with similar values to provide a seamless service.  

The association provides us with a platform to share knowledge, ideas and best practice as well as information about the latest technology to ensure we remain at the forefront of the sector. It is also a pioneer in training and development, creating programmes to specifically develop young professionals in the industry as they progress in their careers. 

DFK International has 229 member firms which have a combined total of 441 offices across 93 countries. The association strives for equality, diversity and inclusion, promoting a culture that celebrates difference, challenges prejudice and ensures fairness. 

Martin Sharp, executive director of DFK International, said: “In 1962 the founders of DFK International envisaged setting up an association of independent firms that could support their clients to do business internationally and provide an alternative to the big networks which were being set-up. 

“Although DFK has grown considerably and the international business landscape has changed, the principles and ethos on which DFK was established still remain.  

“Beyond this, DFK provides a forum to share knowledge and best practice between like-minded individuals who are keen to support their clients and help fellow member firms.  

“We have a strong family atmosphere which has grown over the years to give member firms the opportunity to build relationships with people from different countries and different cultures. 

“This year we celebrate this success and look forward to continuing to build these relationships in the years to come.”   

To learn more about DFK International visit www.dfk.com 

 

How can the use of Cloud Accounting software help save our planet?

The switch to paperless working is a key development in reducing reducing carbon emissions

With much of the focus recently on COP26, we are aware of ­the challenges our planet faces and the challenges ahead if we don’t act now. But is there more we can do as businesses to ensure we are ‘doing our bit’ for the environment?

We know that cloud accounting can help you access your financial data in real time, as well as streamlining business processes, but did you know it can also help reduce your carbon footprint?

When discussing the benefits of using cloud accounting software, one area that often gets forgotten about is the environmental benefit. With businesses looking to adopt more eco-friendly methods to demonstrate their commitment towards Corporate Social Responsibility, the use of cloud accounting software can help reduce the environmental damage, as well as improving company image and attracting investors. So how does this work?

Firstly, when switching to cloud accounting software, you are reducing your carbon emissions by essentially consuming less electricity (more on this later). The reason for this is due to using fewer servers and by using it more efficiently, whereas local servers would require managing as well as processing the data which leads to increased carbon emissions.

Secondly, by using online software you will be moving towards a paperless system which will allow you to change your financial processes to ensure you are using the software in the most efficient way. We are aware of the environmental impact of printing and overusing paper, however cloud accounting software ensures your invoices for example, are sent digitally via email, therefore reducing paper usage and allowing you to take advantage of the benefits of digital accounting. With many financial tasks now capable using online software, it has become a lot easier for businesses to move towards paperless systems.

One of the main contributors to CO2 emissions across the world are cars, but businesses can help minimise their employees commute and emissions by using cloud accounting software from home. The COVID-19 pandemic gave us a real example of how finance teams can continue to undertake their roles while working from home, if equipped with the right software. Due to its nature, cloud accounting software can be accessed from anywhere in the world with an internet connection. Therefore, it can be used in collaboration with many other communication and financial apps to ensure that staff can work from home and still collaborate with their team members and stakeholders. The use of online software, therefore, allows businesses to reduce transportation emissions by utilising software that is cloud based and therefore eliminates the need for teams to be working in offices and travelling unnecessarily.

Finally, did you know that using cloud accounting software can help reduce your electricity usage? Whilst conventional hardware systems require power sources, a large amount of upkeep and cooling facilities, moving towards cloud software can help you save money on energy. Through using software which is run on remote servers and stores data in the cloud, you can drastically reduce your energy usage by moving to the cloud. This not only reduces your electricity bill, but also helps reduce your energy consumption.

There is no doubt that businesses can use cloud accounting software to drastically reduce their carbon emissions and energy usage. There will undoubtedly be greater focus on how businesses can do more to curtail climate change and global warming concerns, but by starting to look at the accounting software and processes being used at present, it can easily be moved to a greener future with the level of advancements in cloud technology.

If you would like to discuss how cloud accounting can help your business, please contact us.

 

Autumn Budget 2021 – key points

On 27 October, the Chancellor set out his plan for government tax and spending for the year ahead in his Autumn Budget 2021

The forecast for the UK economy is one of strong growth that takes the country back to pre-covid levels by 2022 but that inflation is set to rise to 4% next year.  Below is a summary of the key points from the Statement:

Public Finance and State of the Economy 

  • According to Office for Budget Responsibility (OBR), Inflation is due to rise to an average of 4% next year 
  • UK economy forecast to return to pre-Covid levels by 2022 
  • Annual growth set to rebound by 6.5% this year, followed by 6% in 2022 
  • Unemployment expected to peak at 5.2% next year, lower than 11.9% previously predicted 
  • Wages have grown in real terms by 3.4% since February 2020 
  • Borrowing as a percentage of GDP is forecast to fall from 7.9% this year to 3.3% next year 
  • Borrowing as a percentage of GDP will then fall in the following four years to 1.5% 
  • UK Government projects Foreign aid spending to return to 0.7% of GDP by 2024-25 

Government Spending 

  • Funding will rise by an average of £4.6bn for Scottish Government, £2.5bn for Welsh Government, and £1.6bn for Northern Ireland Executive 
  • Levelling Up Fund will mean £1.7bn invested in local areas across the UK 
  • Government backing projects in Aberdeen, Bury, Burnley, Lewes, Clwyd South, Stoke-on-Trent, Ashton under Lyne, Doncaster, South Leicester, Sunderland and West Leeds 
  • Extra £2.2bn for courts, prisons and probation services, including funding to clear the courts backlog 
  • Tax relief for museums and galleries will be extended for two years, to March 2024 which means tax credits doubling for the Creative Industry 
  • Core science funding to rise to £5.9bn a year by 2024-25 
  • £6bn of funding to help tackle NHS backlogs 

Taxation and Wages 

  • Universal Credit taper rate will be cut by 8% no later than 1 December, bringing it down from 63% to 55% – allowing claimants to keep more of the payment 
  • Confirmation business rates to be retained and reformed 
  • A 50% business rates discount for the retail, hospitality, and leisure sectors in England in 2022-23, up to a maximum of £110,000 
  • Planned rise in fuel duty to be cancelled amid the highest pump prices in eight years 
  • Consultation on an online sales tax 
  • National Living Wage to increase next year by 6.6%, to £9.50 an hour 

Children and Education 

  • Schools to get an extra £4.7bn by 2024-25 
  • There will be nearly £2bn of new funding to help schools and colleges to recover from the pandemic 
  • Schools funding to return to 2010 levels in real terms – an equivalent per pupil cash increase of more than £1,500 
  • £300m will be spent on a “Start for Life” parenting programmes, with an additional £170m by 2024-25 promised for childcare 
  • A UK-wide numeracy programme will be set-up to help improve basic maths skills among adults 

  Air Travel 

  • Flights between airports in the UK nations will be subject to a new lower rate of Air Passenger Duty from April 2023 
  • Financial support for English airports to be extended for a further six months 
  • From April 2023, new ultra long haul band in Air Passenger Duty for flights of over 5,500 miles introduced 

Alcohol 

  • Planned rise in the duty on spirits, wine, cider and beer cancelled 
  • Simplification of alcohol duties will see the number of rates drop from 15 to six 
  • Stronger red wines, fortified wines, and high-strength ciders will see a small increase in their rates 
  • Rates on many lower alcohol drinks including rose wine, fruit ciders, liqueurs, lower strength beers and wines to fall 
  • All sparkling wines to pay same duty as still wines of equivalent strength 
  • Lower duty on draught beer and cider from containers over 40 litres will cut the rate by 5% 

Housing 

  • £24bn earmarked for housing: £11.5bn for up to 180,000 affordable homes, with brownfield sites targeted for development 
  • 4% levy will be placed on property developers with profits over £25m rate to help create a £5bn fund to remove unsafe cladding 
  • £640m a year to address rough sleeping and homelessness 

 

If you would like to discuss any of the points above, please contact us. 

 

 

 

 

Carlyn MacMillan

Position: Accounts Supervisor
Email: carlyn.macmillan@alexandersloan.co.uk
Phone: 0141 204 8989

I joined Alexander Sloan in 2018, having previously worked in another accountancy firm in Glasgow where I began my training in 2015.

I became Accounts Supervisor in 2021, assisting and supporting junior members of staff in the preparation of accounts, including charities, and digital accounting software.  I qualified as a Chartered Accountant in 2022.  I also support staff in their progression towards their CA or ACCA qualifications.

I have a portfolio of clients which I am responsible for overseeing and managing. This has enabled me to develop a strong working relationship with clients, built upon trust and understanding, which I place great value on.

Carlyn

The Future of Accounting, Apps and Automation

We have seen a seismic shift in the accounting sector which has led to a more dynamic, efficient, and progressive way of working.

There are several software providers who offer cloud accounting, Xero being a prime example.   Since the early 2000’s we have seen a change in the accounting sector which has led to a completely new way of working for many accountants.

Whilst there still are many who undertake a more traditional way of working, others have benefited from enhancing their staff’s skillsets and knowledge by delving into the digital world. This has not only given them an advantage over others, but puts them one step ahead in adhering to HMRC’s ‘Making Tax Digital’ requirements. The undertaking of cloud accounting software by accountants for those who wish to be at the forefront of emerging technologies has also paved the way for many to provide additional consultancy services through the use of real time accounting data. 

There is no denying the benefits of using cloud accounting software: anytime access, real time data and live bank feeds to name but a few. Aside from the features, the cost is another significant factor when deciding which software to use. Many clients have been faced with costly product upgrades each year as well as increased pricing. However, Xero for example, represents great value for money with a monthly rolling subscription, with no hidden extras. So, have you explored how Xero could work for your business? 

The coronavirus pandemic further highlighted the need for businesses to have a complete insight into their finances, whether it be up to date accounts to access government grants, or to ensure effective cash flow management. The requirement to have real time, robust financial data has never been so important. As businesses move to a hybrid working system, the need for cloud-based and accessible accounting software is now a requirement, rather than an option, to enable staff to continue their roles regardless of where they are based. 

We have seen a complete change in the methods used to perform day to day accounting tasks. Whether it be through a live bank feed in real time, or the utilisation of apps to enhance areas such as credit control. Cloud software now allows you to automate the bank reconciliation process by utilising bank rules for efficiency and automatic posting of journals. 

There is no doubt we are witnessing a change in the role of an accountant, driven by the introduction of new technology and regulations. Our clients deserve to be kept up to date with the latest technology which only helps them adhere to new regulations, such as Making Tax Digital. Many would argue HMRC have paved the way for a need to record financial records digitally, but was there already a shift to modern day accounting? 

Regardless of where digital adoption originatedwe are currently seeing a surge in interest from many businesses who require real time, accurate reporting. More so for cash flow purposes, but also to regain an understanding of where their business is positioned. The likes of Xero and its excess of 800 apps makes it a very popular option for businesses who want to delve into the modern way of accounting and ensure they have a complete, real time insight into their finances.  Gone are the days of receiving out of date management accounts, why not get on board with the cloud movement and reap the benefits too? 

There is no question that Xero is positioned at the top of the market with an average price of £20 per month, considerably less than many other rival software providers. Price, paired with its unlimited number of users and ability to build with the use of apps makes it even more appealing. 

Contact us for a free Xero demonstration and how you can benefit from using this software. 

Please contact our Cloud Accounting team to learn more. 

Virtual Kiltwalk 2021

Congratulations to all our Alexander Sloan team who took part in the Virtual Kiltwalk 2021 – and raised over £5,000 in the process!!

Over the weekend of 23-25 April, some of our team here at Alexander Sloan took part in the Virtual Kiltwalk Weekend, each person aiming to walk between 6 and 26 miles over the weekend.

Thankfully, the weather was beautiful and great for walking and each person averaged a whopping 19 miles – excluding all the extra miles clocked up by supportive family members and dogs!

With Scotland still in lockdown, unfortunately we couldn’t all join up but our team could be seen walking around Aberfoyle, Falkirk, Glasgow and even up Meikle Bin.

Congratulations to all who took part and we hope your feet and legs are recovering! A huge thanks also to all those who donated so generously.

Our team raised an incredible total of £5,182.50 – so a big thank you to all! The money raised will go to Alexander Sloan’s 2021 Charity of the Year.

This year, Alexander Sloan’s Charity of the Year is SANDS, a national charity providing support to anyone affected by the death of a baby.

To learn more about the charity and their work, please visit www.sands.org.uk.








Nicola Hutchison

Position: Audit Supervisor
Email: nicola.hutchison@alexandersloan.co.uk
Phone: 0141 204 8989

I trained with Alexander Sloan and qualified as a Chartered Accountant in 2020. I currently hold the role of Audit Supervisor. I lead various audits in the Housing Association, Credit Union and Charity sectors and also have experience with commercial clients.

In addition, I have a small portfolio of audits which I manage.  This involves having a close relationship with clients and staff to ensure the audit process is completed efficiently.

I also hold the role of Student Mentor and support other ICAS and ACCA students throughout their training and audit work.

Making Tax Digital

From 1 April, VAT registered organisations will face further obligations from HMRC’s drive towards Making Tax Digital

Making Tax Digital – What happens next? 

For many years HMRC have had high ambitions of becoming the worlds ‘most digitally advanced tax administration’ and in doing so they are shaking up the way in which individuals and businesses record their tax affairs. By implementing the Making Tax Digital (MTD) scheme, HMRC plan on initially mandating digital record keeping to reduce the UK tax gapwhich lies at c.£31 billion of which £9 billion is attributable to ‘errors and failure to take reasonable care’. So where are we now and what happens next? 

Well, since April 2019 most UK VAT Registered businesses with taxable turnover above the VAT threshold of £85,000 were mandated to maintain digital VAT records. This also meant they were required to submit their VAT returns using Making Tax Digital (MTD) compatible software. For businesses to ensure they could apply these new processes, HMRC implemented a one-year soft landing period, which was later extended a further year, due to the COVID-19 pandemic. 

However, from 1 April 2021, UK VAT registered businesses will face further MTD obligations which were initially meant to be implemented from April 2020 but also delayed due to the COVID-19 pandemic. These new obligations centre around the requirement for a ‘digital link’. According to HMRC this essentially means there is a need ‘to use a compatible software package or other software that connect to HMRC systems’. 

Regardless of your current situation, from 1 April 2022 all UK VAT registered businesses must sign up to be MTD registered, regardless of whether they have exceeded the VAT threshold. So, are you prepared? If not, why not make the move to using MTD compliant software in advance of the new changes? 

How will this affect my business? 

If you have not already done so, you will be required to keep your VAT records in digital form. We recommend using cloud accounting software that is MTD compliant, such as Xero. In doing so you will be adhering to HMRC’s policies by utilising a ‘digital link’. 

What is a digital link? 

For example, if you use multiple software packages to keep records or submit VAT returns you will need to essentially link them, without any manual input. The most common example for businesses is the use of spreadsheets where figures are then copied and pasted into another system for the VAT return to be submitted – this is will no longer be allowed. 

HMRC confirmed ways in which you could link software:  

  • using formulae to link cells in spreadsheets 
  • emailing records 
  • putting records on a portable device to give to your agent 
  • importing and exporting XML and CSV files 
  • downloading and uploading files 

There are however some exceptions to the above obligations. HMRC has granted exemptions for manual calculations for VAT schemes such as partial exemption, flat rate or the capital goods scheme. The digital links between the software packages used, need to be in place before the business’s first VAT period after the 1st of April 2021. 

What if I cant implement the ‘digital link’ in time for April 2021? 

HMRC has offered an option for businesses to apply for an extension to the 1 April 2021 deadline if it can be proven that there is no reasonable fix to their legacy systems. The extension would involve notifying HMRC as soon as possible and providing a comprehensive plan to resolve the issues. We would advise you contact HMRC as soon as possible if you require extension. 

How can we help 

We have been assisting clients for some time now to ensure they are using MTD compliant software. As well as adhering to HMRC MTD rules, businesses have benefitted from the additional benefits of using Cloud Accounting software such as Xero. MTD for VAT was the first of many areas which HMRC will target, there are already plans for digitising Income Tax in 2023 and Corporation Tax in 2026.  

So, are you confident you are using the right software? You may not be VAT registered, but knowing HMRC’s plan for the years ahead, we would encourage you to review your financial systems at this stage and plan aheadWhy not get in touch and let us help ensure you are ready for the changes ahead. We have a range of Cloud Consultancy services which can help ensure your business in not only MTD ready but ensure accessibility robust real time financial data. 

Please contact us to learn more. 

2021 Budget

The Chancellor announced a range of measures in his 2021 Budget on 3 March 2021 with upcoming changes to corporation tax a key feature.

The Chancellor has pledged to do ‘whatever it takes’ during the pandemic to support business and key announcements in the 2021 Budget, delivered on 3 March 2021, were as follows:

An extension to the furlough scheme until the end of September 2021;

An extension to the SEISS scheme to support the self-employed;

The reduced 5% VAT rate for the hospitality sector will remain in place until September 2021 with a transition rate of 12.5% from then until March 2022;

Corporation Tax rates will rise to 25% from April 2023, though a Small Profits Rate of 19% will be retained for companies reporting smaller profits;

A super-deduction, available from 1 April 2021 to 31 March 2023, for tax purposes of 130% on qualifying capital expenditure;

The Personal Allowance threshold will be frozen for five years once it increases in April 2021.

For further details, please click below to read our 2021 Budget Summary:

2021 Budget Summary

VAT Payment Deferral Options

VAT payments that were deferred from last year can be spread over the next 11 months.

COVID-19 – VAT payment deferral options 

It has almost been one year since the UK Government announced that certain VAT payments could be deferred to support businesses during the COVID -19 pandemic. The VAT deferral was available to all UK VAT registered businesses with payments due between 20 March 2020 and 30 June 2020, except for the VAT MOSS payments. In addition to this announcement, HMRC stated they would not charge any interest or penalties, but instead requested all VAT returns during this period be filed as normal with all filing deadlines still fully applicable. As the VAT payment deferral was automatic with no application or notification required to HMRC, we outline below the options currently available to you.

When do I need to pay my deferred VAT payment? 

Initially, when the deferral was announced, businesses were given a deadline of 31 March 2021 to pay any VAT liabilities. However, further announcement was made on 24 September 2020 in the Chancellors Winter Economy Plan, stating that instead of a hard deadline of 31 March 2021, businesses will also have the choice of making up to eleven equal instalments via the VAT deferral new payment scheme 

What are my payment options? 

If you have deferred VAT payments due between 20 March 2020 and 30 June 2020 and have yet to make the payment, you can choose from the following to avoid any interest or penalties being charged: 

  • Pay the deferred VAT in full on or before 31 March 2021.  
  • Join the VAT deferral new payment scheme via the online service within your Government Gateway account which opens between 23 February 2021 and 21 June 2021 
  • Speak to HMRC by 30 June 2021 if you need extra help to pay. 

How do I join the VAT deferral new payment scheme? 

The VAT deferral new payment scheme will commence via an online service within your Government Gateway account from 23 February 2021 to 21 June 2021 and will allow you to pay your deferred VAT in equal instalments, interestfree. You have the option to choose the number of instalments you wish to pay, depending on when you join the scheme 

The number of instalments available to you is determined by the month in which you join the scheme. As the scheme is available to join until 21 June 2021, this is the last date you can join to qualify for paying in instalments, with all instalments needing paid by the end of March 2022. 

The table below extracted from HMRC guidance, outlines the cutoff dates for joining the scheme as well as the maximum number of instalments available, including the first payment. 

If you join by:  Number of instalments available to you: 
19 March 2021  11 
21 April 2021  10 
19 May 2021  9 
21 June 2021  8 

Monthly joining deadline (HMRC 2021) 

 

Please note that if you are on the VAT Annual Accounting Scheme or the VAT Payment on Account scheme you will not be able to join from 23 February 2021, instead, you will be invited to join towards the end of March 2021. 

Can anyone join the VAT payment new deferral scheme? 

To use the online service, you must join the scheme yourself, your agent cannot complete this for you. You must also meet the following criteria: 

  • Have deferred VAT to pay 
  • Pay your first instalment when you join 
  • Ensure all of your VAT returns have been submitted from the past 4 years 
  • Pay by direct debit but if this is not possible speak to an advisor on the COVID-19 helpline on 0800 024 1222 
  • Have access to your own Government Gateway account to join the scheme 
  • Know exactly how much you owe HMRC  

If any businesses would like to join the new payment scheme but do not have access to a UK bank account, are unable to pay by direct debit, or have dual signatories on their bank account, we would encourage you to contact the COVID-19 helpline on 0800 024 1222. 

For further information please see HMRC’s guidance here