Bookkeeping

Now all UK employers must put certain staff into a pension scheme and contribute: this is ‘automatic enrolment’

If you don’t employ anyone then you are excluded and you can tell the Pensions Regulator this. If you are an employer, you will have a staging date which is the date that automatic enrolment duties come into effect for your business. There will be a list of activities that need to be completed to set up and enrol staff into a Qualifying Workplace Pension Scheme.

So here’s why you need to sit up and pay attention and how!

• Staging dates vary but can be found at www.thepensionsregulator.gov.uk/employers/staging-date.aspx A Staging date can be brought forward but not moved later.
• Start acting within the first month of staging otherwise you are in breach of the regulations and could be fined
• It is always the employer’s responsibility to ensure that they comply with the Legislation but a business owner can ask a bookkeeper to take on the role of facilitating the auto-enrolment; the employer simply remains ultimately responsible for complying.
• A Declaration of Compliance must be completed within five months of staging.
• If you are not sure whether a particular worker is, in fact, someone that the rules apply to, businesses can get guidance from the Pensions Regulator via customersupport@autoenrol.tpr.gov.uk
• The minimum contributions are 2% (including 1% staff contribution) for staging dates up until 5^th April 2018 and then they are proposed to increase to a total of 5% and later 8% but are still subject to Parliament approval.
• There are special rules for the first deduction of contributions on automatic enrolment and after this, the Law requires that staff pay deductions must be paid into the staff pension scheme no later than the 22nd day (19th if you pay by cheque) of the next month.
• Penalties: Penalty notices can be issued to punish persistent and deliberate non-compliance. A fixed £400 penalty notice is issued if an employer doesn’t comply with statutory notices or if there’s sufficient evidence of a breach of the Law. If an employer failed to comply with a statutory notice there is also an escalating penalty with a daily rate of £50 to £10,000 depending on the number of staff an employer has.
• If you know you are already in breach of the auto-enrolment Legislation simply confess to The Pensions Regulator; they are friendly and will do their best to assist you.

How we can help?

Arianna Helm is a fully qualified bookkeeper with the ICB. She can become the secondary contact at any company for auto-enrolment and the person that will manage or handle implementation. Bookkeepers cannot provide advice about pensions schemes themselves but they can help with the official record keeping including opt-ins and opt-outs and also assess new starters.

In this article, please find the information provided in the e-mail sent to all client’s with regards to the new Money Launder Laws.

Changes that have been made

The first bit of information that you need to be aware of is something that we have been expecting for several years, and we are very happy about. Bookkeepers, indeed any business that offers financial services in any way, are now classed as a “regulated profession”. This means that to legally offer such services, Bookkeepers (individually) must now have a valid practicing certificate issued by a supervisory body registered with HM Treasury or be registered directly with HMRC. Ihelm Enterprises has had a valid practicing certificate for several years through my membership with the Institute of Certified Bookkeepers. For reference, my membership number is 61153985 and my practice number is¬†304657.

Whilst this doesn’t mean there will be any changes in the services we offer, it does mean that the industry as a whole is now answerable to HM Treasury and the government under several new legislations – the prime one is the Money Laundering Act that was passed in December 2007. Our delay in implementing this fully has been due to awaiting the Act to be interpreted by the associations and the pertinent parts to be disseminated to ourselves.

This does mean that Ihelm Enterprises must take more responsibility for understanding your business finances and you, our client, in order to protect you, ourselves and the government from illegal activities that can occur.

The Money Laundering Law (in simplistic terms)

There are three principal money laundering offences which are contained in sections 327, 328 and 329 of the Proceeds of Crime Act 2002.

There are also similar offences created under the Terrorism Act 2000 – section 15, 16, 17, and 18.

Depending on the type of business that you are, we will require different things – these are listed below – along with the reason for us requiring these items. Unfortunately, if we cannot obtain these items from yourself than by law, we may have to terminate your contract with us. Please don’t hesitate to contact us for more information.

If you are a Sole Trader/Partnership:

If you are in a partnership we will require all of the information below for each partner.

1) Please confirm your Home Address and if application your Trading Address if different:

2) Size and Sources of your capital to date and any future sources or predictions for your capital. This relates to any money you invest into the business either your own funds or from borrowing it from other sources.

3) The size of your personal income and source in the past, and predicted personal income in the future. If you are employed by another business, alongside running your own business, you will need to provide information relating to your earnings from the other business.

4) Confirm the type of business you are in, and the sector your business is in.

5) Have you ever been subject to bankruptcy proceedings? If so, can you give some details?

6) Have you ever been disqualified as a director of a company?

7) Can you confirm that you have registered with HMRC as a sole trader?

We are required to see proof of identity as part of the Money Laundering Regulations. This is because we have to indicate that we have identified yourselves and that you are who you say you are.

We will need you to send us either 1 piece of photo identity and an additional piece of evidence, or 1 piece of non-photo identity, proof of address or date of birth PLUS an additional piece of evidence.

List 1: Evidence of Identity

Acceptable Photo Identity:

i) valid passport; or

ii) valid photocard driving license (full or provisional); or

iii) national identity card (non-UK nationals issued by EEA member states and Switzerland); or

Acceptable Non-photo evidence of identity:

Documents issued by a government department, incorporating the person’s name and residential address or their date of birth,

i) a current UK full driving license old version (not provisional licenses); or

ii) evidence of entitlement to a state or local authority funded benefit (including housing benefit and council tax benefit), tax credit, pension, educational or another grant; or

iii) documents issued by HMRC, such as PAYE coding notices and statements of account (NB: employer issued documents such as P60s are not acceptable); or

iv)end of year tax deduction certificates

List 2: Evidence of address or date of birth

i) instrument of a court appointment (such as a grant of probate, bankruptcy); or

ii) current council tax demand letter or settlement; or

iii) current (within the last 3 months bank statements, or credit/debit card statements issued by a regulated financial sector firm in the UK, EU, or JMSLG equivalent jurisdiction (but not those printed off the internet); or

iv) a file note of a visit by a member of the firm to the address concerned (“home visit”); or

v) an electoral register search showing residence in the current or most recent electoral year (can be done via http://newcorp.192.com/search/index.cfm); or

vi) a recent (last available) utility bill (gas, water, electricity, telephone – not mobile phone bills); it must be a bill or statement of account (not correspondence); or

vii) valid photocard driving license (full or provisional); or

viii) a current UK full driving license old version (not provisional licenses); or

ix) evidence of entitlement to a state or local authority funded benefit (including housing benefit and council tax benefit), tax credit, pension, educational or another grant; or

x) documents issued by HMRC, such as PAYE coding notices and statements of account (NB: employer issued documents such as P60sare not acceptable); or

xi) a solicitor’s letter confirming recent house purchase or land registry confirmation (you must also verify the previous address)

If you are a Registered Company (e.g. Ltd):

1) Please confirm your Registered Company Name (as appears on Companies House):

2) Please confirm the company registered address and the main trading address if different:

3) Please, can you let us know the basic structure of your company. E.g. who controls and manages it – directors, shadow directors etc.

4) Has the company been audited in the past, if so were the accounts qualified? If they were qualified can you let us know who qualified the accounts?

5) In order to ensure we comply with the regulations, we require the following information if available. If it isn’t available please let us know why. We will return all documents by signed-for delivery within 2 days):

i) Certificate of Incorporation

ii) List of Shareholders

iii) List of people who have voting rights with their shares in the company

iv) Your position in the company

v) Your name

6) The main source of income for the company:

We will need to take copies of the information and store it in your client file. Every year we will be asking you to verify the information is still correct and to notify us of any changes.

Are you a small business and:

• trying to run your business
• develop your product or service
• market your business
• deal with the day-to-day bookkeeping

It isn’t always easy to do everything that needs to be done when you are running your own business, which is why it is a great idea to outsource the things that you aren’t very good at, so you can spend your time more wisely and focus on what you do best, which is sell your business! However, I know it isn’t always easy to just outsource everything, as there are costs when you do that, and if you are just starting out, the cash isn’t always available.

So what do you do if you can’t outsource? You have a couple of options – you could find someone who is trained and has experience in the field you want to outsource – let’s say bookkeeping in this case, and you can see if you can come to a mutual working agreement, where maybe instead of paying with cash, you trade services. This can work really well as long as both parties agree to terms beforehand and both parties feel they are getting a mutually benefitting deal.

Another option is to try and learn how to do some of the things you aren’t very good at, without spending a lot of money. So you could join a facebook group, or follow people on twitter, and read blogs that are published providing easy to follow tips. People who are experts in their field won’t always give away all of their secrets, but you can pick up some very good hints and tips on how to do the basics in things like marketing, publishing a website, handling the bookkeeping and accounts, and many other aspects that businesses need to be involved in.

At Ihelm Enterprises Limited, we offer bookkeeping and payroll for any sized business, and we are more than happy to speak with you and arrange an alternate type of payment, or even a payment plan. Our aim is to take away the stress and frustration of dealing with the day to day bookkeeping so that you can focus on your business and doing what you do best.  Why not contact us via the contact form on the website, our Facebook Page, or on Twitter (@ihelmenterprise) and see how we can help you with your small business bookkeeping.

Why is it important for a business to keep good records? There are many reasons to do this but here are the top three reasons I believe it is important:

• HMRC Tax Inspections
• easier to find information
• less stressful at tax return time

When a new client approaches me and asks how I can help them with their bookkeeping and financial record keeping, I always ask them whether they have separate bank accounts, PayPal accounts, etc for their business. It makes it so much easier to know exactly what funds your business has if the bank account is separate to their personal accounts. It will also cut down on the queries that I may have, as I won’t continually be asking whether something is for personal or business use. If you do use your business account to buy something personal, please make a note of it, as again this cuts down on any queries. It is also a very good idea to file all of the bank statements in a binder, with a section for each different account.

Another top tip is to keep all of your receipts and invoices in a folder for each month. Separating them out by month, before you give them to your bookkeeper or accountant, means they will need to do less work as they won’t need to sort out the receipts. Here are a few time-saving tips for dealing with receipts and invoices:

• If you have paid for something personally, write it on the top of the receipt – it’s a 5-second job and can save valuable time later on.
• If you have bought a mixture of business and personal items at the same time, highlight either one and make a note on the receipt as to what the highlighted ones are.
• Keep purchase invoices and sales invoices separate, and separate them out by paid and unpaid

The final tip, and I think this is probably the most important, is to get your processes set up and in place straight away. If you get into the habit of sorting out your accounts on a monthly basis, or even weekly, it will save a lot of frustration when it comes time to file your return. It will also save you money if you are using a bookkeeper or an accountant, as they will be working on your accounts throughout the year, instead of in one big chunk.

All of the above tips will help your business to run smoother, and help you be less stressed. They will make it easier for HMRC to find information if they do a tax inspection as everything will be in one place. Being able to find information quickly is very important when it comes to finances because the information can tell you so many things:

• do you need to register for VAT
• do you have the money to grow your business
• who you owe money to
• who owes you money
• and many more

The financial information all being organised and in one place can also help to prepare your accounts ready for filing your tax return. If the records are all over the place and disorganised, it can cause you to use up valuable time, and money, in making sure everything is entered into the accounts.

Would you like to know how I can help you get your accounts in order and keep them that way? Contact me via the contact us page, or on Facebook or Twitter.

Bookkeeping, a word that instils fear and panic in thousands of small business owners. I am here to help allay some of that fear by helping you to understand the basics of bookkeeping.

The first thing that you need to understand is that proper bookkeeping is essential to every business and if you ever get to the point where you just aren’t able to devote the time to do it properly or are struggling to understand what needs to be done, you should find a qualified bookkeeper who can help you.

Bookkeeping is based on the double-entry system – money comes in, but it also goes out. Every transaction must have a two-sided entry. These two sides are known as Debit (DR) and Credit (CR). For each transaction, the DR side must equal the CR side. For example, if you buy a pencil for 10p, you have paid money out but have also gained a pencil.

DR Stationery	0.10p
CR Cash	0.10p
purchase of a pencil

A very simple way to start keeping your records is to use a pen and paper and to use T-accounts. Set up each account (Cash, Stationery, Sales, etc) as a T-account with one side as the Debit side and one as the Credit Side.

When you enter a transaction assign a number to it so that you can find both corresponding entries. You also need to make sure you date your entries.

Here is an example of how to record a sale. You make a sale of £5.00:

All of your T-accounts now look like this:

At the end of each month, total up each T-account. The total DRs should equal the total CRs.

Total DRs =	£5.10p
Total CRs =	£5.10p

Using T-accounts is a very simple way to keep track of your accounts.

Lesson 2 will look at the different types of accounts: Assets, Expenses, etc.

If you have any questions on today’s lesson, or would like help answering other bookkeeping questions, please leave a comment below or contact us via the Contact Us Page, our Facebook Page, or on Twitter.

When people ask me what I do for a living, the majority of people give me a look of sympathy and some even get a look of disgust on their face. I’m going to tell you a secret though….I LOVE BOOKKEEPING!!

I have always had an affinity for numbers right from a young age. In high school, I loved algebra and calculus. I didn’t enjoy geometry or statistics quite as much, but give me complicated equations to work out and I was a happy girl. I think my interest in bookkeeping actually started when one of my older sisters took an accounting course in high school and I watched her do some of her homework. I took that course myself and I was hooked. It was my first proper introduction to the world of bookkeeping and I learned about the very basics that I talked about in The Basics of Bookkeeping: Lesson 1.

I didn’t actually take any further accounting courses until my second year of university. I then moved to the local college and excelled at all of the courses I needed to take. I graduated with a Business Administration Accounting degree- I was qualified to do bookkeeping.

Strangely though I didn’t do any bookkeeping until I moved to the UK in 2003, when I did a home learning course to brush up on my skills.

Bookkeeping is all about numbers and numbers can tell a story. When all of the receipts, invoices and all of the other financial information is entered into a set of accounts properly, you get a story about your business. Just like an author, a bookkeeper writes story, but in numbers

So there is my secret – I LOVE NUMBERS & BOOKKEEPING. I am doing exactly what I love.

If you would like to know how I can help you tell your business story, contact me via the Contact Us Page, our Facebook Page, or on Twitter.