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Sole Trader or Limited Company?

Posted on by admin

When most people have decided to set up their own business, the first issue they encounter is how to do this. This inevitably leads to the question, should I operate as a sole trader or start my own limited company? There is no right or wrong answer and it depends. There are many factors to consider and many advantages and disadvantages to setting up as either.

The decision often depends on the personal preference of the person who owns and runs the business and the type business they are operating. There is never one standard answer for all businesses so it is worth spending the time to consider this carefully. It is about finding the right business format for the individuals involved as there is no easy answer. The decision should always be made on the specific business and what is important to the individuals concerned.

Firstly, lets get the formalities out of the way. Any individual of any nationality may register a limited company subject to a few conditions:

• They are not an undischarged bankrupt
• They have not been restrained by court order
• They are not subject to UK government restrictions

You can become a director of a limited company from as young as 16 years old.

The Advantages of a Limited Company

• Perhaps the most attractive benefit of trading as a limited company is the aspect of limited liability. Essentially this protects the personal assets of the officers should the company run into financial difficulties. Financial liability is limited to what has been personally invested.

• There are potential tax savings in terms of remuneration. The most efficient strategy is to pay the directors a low salary which is supplemented through payment of dividends and subject to lower tax rates (8.75% for basic rate taxpayers, 33.75% for higher rate taxpayers and 39.35% for additional rate taxpayers). A dividend is is a payment made to the company owners from the profits of a company after corporation tax has been accounted for.

• The ownership of a limited company can easily be divided up through the sale of shares – the shares can be further used as a means of generating capital.

• A company is more than just the people in it, and still exists even when members resign, retire or die.

• Companies can create mortgages or floating charges over assets, making it easier to borrow money.

• Perception. Limited companies tend to instil added confidence in suppliers and creditors. Many large organisations will only conduct business with limited companies. An example of this is the IT sector where it can be difficult to obtain contracts unless you trade through a limited company.

The Disadvantages of a Limited Company

• Setting up a limited company means a lot of paperwork due to a higher level of regulation and legislation. There is also ongoing administration, such as filing annual accounts and the annual return with Companies House each year.

• Company accounts and shareholder details are publically available on Companies House website.

• Shareholders and directors may have to personally guarantee contracts entered into with lenders or suppliers.

• Winding up a company is more complex and expensive than a sole trader business or a partnership. Consideration should be given to the longevity of the business.

• Mortgages and insurances such as critical illness cover may all be affected by a typical Limited Company form of remuneration which involves the payment of a low salary supplemented by a higher level of dividends.

If that’s not enough, there are other considerations too:

• Losses can potentially be relieved sooner through a sole trader than a limited company.

• Company cars are rarely tax efficient – unless electric vehicles. Business use versus personal use of a car or van needs some thought and whether this is to be owned personally or by the company.

• The extent to which profits will be retained in the company to fund capital expenditure and expansion.

• It’s also important to be aware that companies pay corporation tax on their profits. The taxable profits of a company are arrived at after deducting all salary payments including those paid to the directors. Dividends are not considered a business expense when calculating Corporation Tax. Company law requires that dividends are paid out of a company’s retained profits – whatever is left after corporation tax has been charged on the profits. It is illegal to pay a dividend if your company does not have sufficient profit after tax available to cover the dividend amount.

• You can earn up to £1,000 in dividends in the 2023/24 tax year tax free. This is reducing to £500 in the 2024/25 tax year.

• In a limited company the profits stay in the business until you pay them to yourself as a dividend. You can pay yourself a tax efficient salary below the tax and National Insurance thresholds, avoiding tax and National Insurance yet still qualifying for national insurance credits against your National Insurance record.

• Sole traders pay both tax and national insurance on their profits and are very restricted as to how they reduce these payments, a limited company gives you greater control and flexibility in how you pay yourself. Sole traders also have to make payments on account in advance of their next tax bill twice a year, which can create cashflow issues. Limited companies do not need to make payments on account (unless a large company).

• The amount of corporation tax depends upon the level of profits. From 1 April 2023 the main rate of Corporation Tax increased from 19% to 25% but the small profits rate of 19% applies to single companies profits of less than £50,000.

There is no ‘best way’ and all options should be considered in conjunction with professional advice to ensure your personal circumstances and preferences are fully taken into account.

Based in the Heart of Evesham, The Accountancy Office are here to help with all of your accountancy needs.

If you wish to discuss any aspect covered in this article please don’t hesitate to call 01386 366741 or email us here.

Tax for Sole Traders Simplification: Is the Cash Basis Now Right for You?

Posted on by Sarah

For the many sole traders and partnerships, managing finances and preparing for the year-end tax return can be a significant administrative burden. Traditionally, this has involved accrual accounting – a method that requires you to account for all invoices and bills when they are issued, not when they are paid.

However, in a major move to simplify tax for the sole trader or self-employed, HMRC has introduced significant changes that make a much simpler method – cash basis accounting – the new default.

Here at The Accountancy Office, we want to break down what this change means for you and your business. It’s a positive development that could make your bookkeeping easier and improve your cash flow, but it’s important to understand if it’s the right fit.

What is Cash Basis Accounting?

In simple terms, the cash basis is a method of accounting that records income and expenses only when money actually changes hands.

  • Income is recorded when it lands in your bank account.
  • Expenses are recorded when you actually pay for them.

This straightforward approach eliminates the need to track debtors (money you’re owed) and creditors (money you owe) for your tax return, offering a much clearer, real-time picture of the cash available to your business.

What Has Changed for the 2024/25 Tax Year?

Previously, the cash basis was an optional scheme with strict turnover limits. From April 2024, HMRC has supercharged the scheme, making it more accessible and beneficial than ever before. The key changes are:

  1. It’s Now the Default: Cash basis is the new standard for sole traders and partnerships. If you want to use the traditional accrual method, you now have to actively choose to do so on your tax return.
  2. Turnover Thresholds Scrapped: The previous entry limit of £150,000 and exit limit of £300,000 have been completely removed. This means unincorporated businesses of any size can now benefit from this simpler system.
  3. Finance Cost Cap Removed: The previous cap that limited the deduction of interest and financing costs to just £500 has been abolished. You can now deduct the full interest costs, provided they are incurred wholly and exclusively for the business.
  4. More Flexible Loss Relief: Restrictions on how you can use a business loss have been lifted. Under the new rules, losses calculated on the cash basis can be used in the same way as accrual losses, meaning they can be offset against your other income from the same or previous year.

The Benefits of Using the Cash Basis

For many businesses, these changes make the cash basis an attractive option:

  • Simplicity: Your record-keeping is significantly simplified, making it easier to manage your own books.
  • Improved Cash Flow: You only pay tax on money you have actually received. This can be a huge advantage if your clients are often slow to pay.
  • Clear Financial Picture: It provides an immediate and easy-to-understand snapshot of the cash your business has at any given moment.

Is the Cash Basis Right for Everyone?

While the cash basis is a fantastic simplification for many, it’s not a one-size-fits-all solution. For example:

  • Businesses that hold large amounts of stock may find the accrual basis gives a more accurate reflection of their profitability.
  • If you are seeking significant business finance, lenders often prefer to see accounts prepared on an accruals basis as it shows a complete picture of your financial health, including future liabilities and income.
  • The cash basis is not available for Limited Companies.

The new, expanded cash basis is a great opportunity for many sole traders, but it’s crucial to get it right.

To find out more and discuss what these changes mean for you, get in touch with our team today.

Tax Changes on Pick-Ups – April 2025

Posted on by Sarah

Starting from April 2025, significant tax changes will affect double cab pick-up trucks in the UK. 

These vehicles, previously classified as commercial vehicles, will be reclassified as passenger cars for tax purposes. This reclassification impacts capital allowances and Benefit-in-Kind (BIK) taxation.

Key Dates:

•1 April 2025: For corporation tax purposes, double cab pick-ups will be treated as passenger vehicles.

•6 April 2025: For income tax purposes, double cab pick-ups will be treated as passenger vehicles.

Implications:

•Capital Allowances: Currently, businesses can claim full capital allowances on double cab pick-ups, treating them as plant and machinery. After 1 April 2025, these vehicles will be subject to car capital allowance rates, which vary based on CO₂ emissions.  

•Benefit-in-Kind (BIK) Taxation: Presently, double cab pick-ups are subject to a flat BIK rate (£3,960 annually). Post 6 April 2025, BIK rates will align with those of passenger cars, calculated on a sliding scale based on CO₂ emissions. Given the typically higher emissions of these vehicles, this change could substantially increase tax liabilities for employees using them as company vehicles.  

Transitional Provisions:

To ease the transition, HMRC has outlined that businesses purchasing, leasing, or ordering a double cab pick-up before the respective April 2025 deadlines can continue to apply the current tax treatment until:

•The vehicle is disposed of.

•The lease expires.

•5 April 2029.

Whichever occurs first.  

Action:

If you’re considering acquiring a double cab pick-up, doing so before April 2025 will allow you to benefit from the existing tax advantages during the transitional period. It’s advisable to assess the long-term implications of these changes on their tax position and consider alternative vehicle options if necessary.

Please contact us if you’d like to discuss your Vehicle tax planning then please contact us on 01386 366741 or email here and one of our advisers will be in contact.

How to Stay in Control of Your VAT Bill

Posted on by Sarah

For many business owners, receiving a VAT bill feels like a nasty shock—suddenly, there’s a large amount to pay, and cash flow can take a hit. But VAT isn’t a surprise tax. It’s 20% of your sales, every quarter, and the key to avoiding stress is simple: don’t treat it as working capital.

Your VAT bill isn’t an unexpected cost – it’s money you’re collecting on behalf of HMRC. The sooner you separate it from your business funds, the easier it is to manage.

VAT Is Not Your Money – Don’t Spend It

When you invoice a client for £1,000 plus VAT, the total invoice is £1,200 – but only £1,000 belongs to your business. The extra £200 is VAT that you’re holding for HMRC.

Many businesses make the mistake of leaving VAT in their main bank account, using it to cover expenses, and then struggling to find the money when the quarterly VAT return is due. Instead, get into the habit of moving VAT straight into a separate account so it’s there when you need it.

How to Avoid VAT Bill Shock

1. Open a Separate Tax Savings Account

Set up a dedicated business savings account specifically for tax. This is where you’ll transfer your VAT, corporation tax, and any other tax liabilities, so it’s not sitting in your main bank account tempting you to spend it.

2. Transfer VAT Weekly or Monthly

Each time you receive a payment that includes VAT, transfer the VAT amount to your savings account. If you prefer, set up an automatic weekly or monthly transfer of 20% of your VATable sales into this account.

This way, when your VAT return is due, the money is already set aside – no stress, no panic.

3. Calculate Tax Obligations Regularly

Don’t wait until the end of the quarter to check how much VAT you owe. If you’re using accounting software like Xero, QuickBooks, or FreeAgent, you can check your VAT liability in real-time.

By reviewing your VAT position weekly or monthly, you’ll always know what’s coming and can adjust if needed.

4. Review Quarterly to Stay on Track

At the end of each VAT quarter, use reports from your accounting software to ensure you’ve set aside enough. If your business is growing and VAT payments are increasing, you may need to adjust your weekly or monthly transfers.

5. Plan for Other Taxes Too

VAT isn’t the only tax you need to set aside money for. Your business will also need to pay:

A good rule of thumb is to set aside around 30-40% of your profits for tax in a separate account. It’s better to have too much than too little.

Action Plan: Stay in Control of Your VAT & Tax

  • Set up a separate savings account for VAT & tax
  • Schedule weekly or monthly VAT transfers (20% of VATable sales)
  • Use Xero or other software to track VAT in real-time
  • Review quarterly to ensure you’re setting enough aside
  • Never use VAT for working capital—it’s HMRC’s money, not yours

Final Thoughts

VAT shouldn’t be a shock. By managing it properly, setting aside money regularly, and tracking your liability, you’ll always be prepared when the bill is due.

If you need help getting organised with VAT, cash flow planning, or accounting software setup, we’re here to help.

Call us on 01386 366741 or visit accountancyoffice.co.uk to book a consultation.

How much turnover does my business need to make to pay me what I want after tax?”

Posted on by Sarah

“How much turnover does my business actually need to make… to pay me what I want… after all taxes?”

If you run a UK limited company and pay yourself a combination of salary and dividends, you might be wondering:

This is a deceptively complicated question. Why? Because income tax, dividend tax, corporation tax and personal allowance tapering all interact in messy ways. The wrong combination of income can trigger extra tax without giving you more in your pocket.

But what if you had a simple calculator that worked it out for you?

That’s exactly what I’ve created: a Turnover Target Calculator for UK Ltd Company Directors.

What the Calculator Does

This tool shows you the turnover required to achieve a specific monthly net income, after all taxes have been deducted.

You can enter:

  • Your desired net monthly income
  • Your business’s annual running costs
  • Your average gross profit margin 

The calculator then shows:

  • The gross dividend required to reach your net income target
  • Tax due on your salary and dividends
  • Corporation tax
  • Total pre-tax profit required
  • The turnover you need to make it all happen

Tax Efficiency Built In

It also flags when you hit the messy part of the tax system:

  • Personal allowance tapering (starts above £100,000 income)
  • The “tax trap” zone where earning more = disproportionately higher tax

To make this easier to compare, the calculator uses a benchmark row set at a net income of £99,999.96. This helps you see exactly how much extra tax you’d pay if you go over it.

Why This Matters

Most small business owners overestimate how much income they can draw and underestimate how much profit they need to generate to get it. Worse, they hit tax traps without realising.

This calculator makes it easy to:

  • Set realistic income goals
  • Avoid the tax cliffs
  • Understand the true cost of drawing more
  • Forecast more accurately

Ready to Use It to calculate your Business Turnover??

The Turnover Calculator is formatted for ease of use, fully protected so you can’t break it, and designed to save you time, stress, and costly mistakes.

For a limited time, the Turnover Calculator will be available free of charge whilst testing is completed. After that, it will be available to purchase online via secure link.

Would you like to start planning smarter with free access today? Get in touch to request your free copy. 

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Need help with your limited company finances? I’m an accountant who specialises in helping business owners take control of their numbers and their income. Drop me a message if you’d like personalised support.

My limited company,How much money does it need to earn to pay me £100,000?

Posted on by Sarah

In our previous blog, we wrote about Dave and Vicky, a married couple running a successful limited company, despite only forming their marketing consultancy company two years ago. However, they were in a bit of a mess with their finances.

In this blog, we outline one of the ways we helped this lovely couple get back on their feet and gain control of their finances.

The Buckhams were making good money, but every month, whatever came in, went straight out. Vicky admitted to having a love of fashion and an excessive online shopping habit. Dave, a keen sports player; loved various sports including football, golf and cricket and found himself regularly spending large sums of money on new kit.

Dave and Vicky had also taken four overseas family holidays in the past 12 months alone, believing the money in the business was theirs to spend – until the tax man told the Buckhams they owed thousands. They were utilising credit cards to pay the bills. They knew they needed to gain control of their personal spending and understand their business finances properly.

The Buckhams weren’t used to owning a limited company and having received no guidance from their previous accountant, they got into a bad habit of spending money freely. Having both been employed in the past, they were used to spending whatever money was in the bank as their taxes had already been paid.

When the tax bills landed, it was always a shock. They felt like they were working hard but never getting ahead financially.

They wanted to apply for a mortgage and to improve their family lifestyle, but they needed an additional £3,000 per month (after tax) from the company to do everything they wanted, an extra £36,000 per year.

Between them, the Buckhams were taking home £70,000 already so with the extra £36,000, this was going to give them the total household income of £106,000 needed (£53,000 each).

They asked us for help with crunching the numbers and how much business income would be needed to generate the additional cash. 

Here’s what we came up with:

Dave and Vicky both receive an annual salary of £12,570. They needed dividends of at least £40,430 each, to give them a total income of £53,000 each per year. 

To allow for the dividend tax that they would need to pay personally (with some of their dividends being taxed at the higher tax rate of 33.75%), they needed to receive dividends from the company of £47,000 each. 

The personal dividend tax payable on £47,000 was £6,394 so the net cash in their pocket was only £40,606 each. A salary of £12,570 and a dividend of £40,606 gives each of them £53,176 per year (total household income of £106,352). A little over what they need but Vicky said she had her eye on a new pair of Christian Louboutins so any extra would be useful. 

Let’s see how that looks for the company….

We need to consider company corporation tax, because the company will be taxed on the profits before the £47,000 dividends can be distributed to Dave and Vicky.

Dave and Vicky’s company needs net profit of £122,078 to cover a dividend of £47,000 each AND the corporation tax payable on company profits (with a marginal corporation tax rate of 23%).

We’ll add back their salaries (2 x £12,570 = £25,140) and £5,000 of business running costs onto the net profit to give us a gross profit of £152,218.

With their consultancy work, the average client value is £14,400 each year and their business operates at a 60% gross profit margin. 

With a 60% gross profit margin, the Buckhams need to generate £253,700 of annual sales. Divided by the average client value of £14,400, this means they need 18 clients.

£253,700 of annual sales will allow Vicky and Dave to receive the personal income they need and for the business to cover the corporation tax liability. Knowing exactly how much their personal income is, has helped the Buckhams budget far more carefully. We also worked with them to ensure that the amount of sales was achievable AND how they were going to achieve it through a well-planned marketing strategy.

Their next tax bill is already planned for – no stress! Their mortgage application looks stronger and the Buckhams finally feel in control of their finances instead of constantly reacting to surprises. Vicky has also created a separate pot of money to save for her Christian Louboutins.

If you’re running a business but struggling to make your hard-earned cash actually work for you, we can help. Let’s get your finances working for your life goals – not against them.

Be more Buckham….

For advice on your Limited Company Call The Accountancy Office  on 01386 366741 or book a call for a time to discuss that is convenient for you.

Financial Reporting Council – FRS 102 Changes from January 2026 – What It Means for Your UK Limited Company

Posted on by Sarah

The Financial Reporting Council (FRC) has announced changes to FRS 102 (the financial reporting rules for UK companies) that will take effect from 1 January 2026 (though you can choose to apply them earlier). These changes aim to make UK reporting more consistent with international standards. Here’s a simple breakdown of what’s changing and how it could affect your business:

  1. New rules for recognising revenue
    Revenue recognition will now follow a model similar to IFRS 15 (the international standard), but with some simplifications to make it easier to apply. This means you’ll need to recognise revenue more consistently based on when goods or services are provided, which could affect the timing of when you report income.
  2. New rules for lease accounting
    If your business rents property, equipment, or vehicles, you’ll need to show most leases directly on your balance sheet (in line with IFRS 16). This means leases will be recorded as assets and liabilities, which could affect your reported profits and financial position. There are some exemptions for smaller or short-term leases to reduce the admin burden.
  3. Other changes
    There are also updates to how you measure:

    • Fair value – how you calculate the value of certain assets and liabilities.
    • Uncertain tax positions – how you account for tax estimates when the outcome is uncertain.
    • Business combinations – how you handle the accounting when you buy or merge with another business.
    • Conceptual framework – updating the general principles that guide financial reporting to align with international standards.
  1. Earlier change for supplier finance arrangements
    If you use supplier finance (e.g., invoice financing or supply chain finance), the new rules for reporting these arrangements will apply from 1 January 2025.

What this means for you

  • Your financial statements might look different, with more assets and liabilities appearing on the balance sheet (especially for leases).
  • Revenue may be recognised at different times, which could affect reported profits.
  • You may need to update your accounting policies and systems to reflect these changes.

These changes aim to improve transparency and consistency in financial reporting – but they could also increase complexity. If you’re unsure how this affects your business, it’s worth discussing it with your accountant to plan ahead as to how these Financial Reporting Council changes could impact you and your business.

How does Corporation Tax work?

Posted on by Sarah

Corporation Tax Isn’t Just an Annual Bill

Many business owners view corporation tax as a once-a-year bill that lands on their desk when their accountant prepares the company’s accounts. However, this approach can lead to financial surprises and cash flow struggles.

The reality is that corporation tax is a recurring tax—it increases as your profits grow, meaning it’s something you need to plan for throughout the year, not just at the end of it. Ideally, you should be reviewing the company’s corporation tax liability each month.

Corporation tax is charged on your company’s taxable profits, and it doesn’t stay static. If your business is doing well and your profits are increasing, your corporation tax bill will rise too. Unlike fixed costs such as rent or insurance, it’s a variable expense that grows in line with your financial success.

Many company owners make the mistake of only thinking about corporation tax at year-end, but by then, it’s too late to do much about it. That’s why proactive tax planning is essential.

How Corporation Tax Works

  • Tax is based on profit – The more your business earns, the more tax you’ll pay. The main rate of corporation tax is currently 25% for companies with profits over £250,000, while those with profits under £50,000 pay 19%. If your profits fall between these figures, a marginal relief calculation applies.
  • Tax is due 9 months after year-end – Your corporation tax bill is payable nine months and one day after your company’s financial year-end. But if your profits exceed £1.5 million, you may need to pay in quarterly instalments.
  • Profitability changes your tax bill – If your business was making £50,000 in profit last year and pays tax at 19%, but this year profits rise to £100,000, your tax bill could more than double.

Why You Need to Plan for Corporation Tax

1. Avoid Cash Flow Problems

If you wait until your tax return is filed to think about corporation tax, you may find yourself struggling to set aside the money in time. By treating it as a recurring cost, you can build it into your cash flow planning.

2. Make the Most of Tax Reliefs

With proactive planning, you can take advantage of tax reliefs and allowances that reduce your liability. For example:

  • Pension contributions – These are tax-deductible and a great way to extract profit efficiently.
  • Capital allowances – If you invest in equipment, you may be able to claim tax relief.
  • R&D tax credits – If you’re investing in innovation, you could be eligible for tax savings.

3. Set Aside Money Regularly

A good habit is to put aside a percentage of your profits into a separate tax reserve account. Some business owners save 19-25% of their monthly profits to ensure they have enough when the bill is due.

4. Know When to Take Dividends

If you take dividends, remember they’re paid after corporation tax. If your tax bill is higher than expected, it could affect how much you can withdraw from the company. Regularly reviewing your figures with an accountant can help you manage this.

Final Thoughts

Corporation tax isn’t just a once-a-year headache – it’s an ongoing financial commitment that grows with your business. Planning ahead, setting aside funds regularly, and making the most of tax reliefs can help you stay in control.

If you’d like advice on tax-efficient profit extraction, cash flow planning, or reducing your corporation tax liability, get in touch.

Call us on 01386 366741 or visit accountancyoffice.co.uk to book your free consultation.

12 things limited company business owners should think about ahead of the new financial year

Posted on by Sarah

For many Limited Companies, as 1 April approaches, mark the start of a new financial year and now is the perfect time to reflect, reassess, and plan ahead. 

A strong financial strategy can set the stage for a more profitable and stress-free year. Financial planning isn’t just about your business – it’s also about ensuring your personal finances are in order.

Here are 12 key areas to focus on for a successful year ahead.

Business Planning

1. Review Your Current Performance

Start by assessing how your business has performed over the past year. Review your financial statements, compare actual results against forecasts, and identify any trends. Are you hitting your revenue targets? Are there areas of overspending? Understanding your numbers is the foundation for future growth.

2. Set Clear Business Goals

What do you want to achieve in the next 12 months? Whether it’s increasing turnover, expanding your team, launching new services, or improving efficiency, setting measurable goals will keep you focused and help guide your decisions.

3. Conduct a Pricing Review

Are your prices still competitive and profitable? Many business owners set their prices and forget to review them regularly. Consider rising costs, inflation and industry benchmarks to ensure you’re charging appropriately for your services.

4. Create a Budget for the Year Ahead

A solid budget keeps you in control of your finances. Factor in expected income, expenses, tax obligations, and potential investments in your business. Having a clear budget helps prevent cash flow surprises and ensures you’re allocating resources effectively.

5. Plan for Tax Efficiency

Tax rules change frequently, so it’s wise to review your tax position with an accountant. Are you making the most of tax reliefs, allowances, and deductions? Could you benefit from extracting profit in a more tax-efficient way, such as dividends or pension contributions?

6. Strengthen Cash Flow Management

Cash flow is the lifeblood of your business. Review your invoicing process – are clients paying on time? Could you improve payment terms or introduce automated reminders? Consider whether you need access to financing to smooth out cash flow fluctuations.

7. Assess Your Marketing Strategy

A new financial year is a great time to refresh your marketing efforts. Does your branding still align with your business goals? Are you consistently attracting your ideal clients? Review your website, social media presence, and client acquisition strategies to ensure they’re working effectively.

8. Review and Improve Business Processes

Are there any inefficiencies in your operations? Look for opportunities to streamline workflows, automate repetitive tasks, or adopt new software that could save you time and money. A more efficient business means more profit and less stress.

9. Plan for Growth and Investment

If you’re aiming for growth, think about what investments you need to make. Do you need to hire staff, upgrade equipment, or invest in professional development? Planning ahead ensures you have the resources available when needed.

10. Protect Your Business

Risk management is often overlooked but is crucial for long-term stability. Review your insurance policies, contracts, and compliance requirements. If you rely on key team members, consider key person insurance. If you’re a director, ensure you’re meeting all your legal responsibilities.

Personal Financial Planning

11. Review Your Personal Budget

How much money do you need to cover your lifestyle and future plans? It’s important to assess whether your salary and dividends are sufficient – and sustainable. Consider any big expenses you have coming up, such as a house purchase, renovations, or that dream holiday.

12. Plan for the Future: Life Insurance, Pensions & Investments

As a business owner, your personal finances are closely tied to your company. Have you protected yourself and your family with the right life insurance and income protection? Do you have a will and lasting power of attorney in place? Are you making the most of pension contributions and investments to secure your long-term financial future? If you’re unsure, now is the time to get advice.

Final Thoughts

he start of a new financial year is a prime opportunity to reset and plan for success – both in business and in life. Taking a proactive approach in these 12 areas will put you in a stronger position for the year ahead.

If you need support with business or personal financial planning, we’re here to help. From tax efficiency and cash flow management to pensions and life insurance, we offer a full range of services to keep your finances on track.

Call us on 01386 366741 or visit accountancyoffice.co.uk to book your free consultation.

Keeping More of Your Money: A Real Story

Posted on by Sarah

We recently started working with a married couple running a successful limited company, despite only forming their company two years ago.

They were making good money, but every month, whatever came in, went out. When the tax bill landed, it was always a shock. They felt like they were working hard but never getting ahead financially.

The Problem?

  • No system for taking money out of the business efficiently
  • No tax planning – so the Corporation Tax bill was always a nasty surprise
  • They wanted to buy a house but struggled to show enough income 
  • They wanted to improve their lifestyle and needed an additional £3,000 per month personal income from their company, but their finances felt unpredictable

What We Did:

  1. Set up a structured way to take money out of the business, balancing salary, dividends and pension contributions to maximise tax efficiency.
  2. Created a tax reserve strategy so they weren’t caught off guard when bills were due.
  3. Planned their income properly so they could show enough on paper for their mortgage application.
  4. Helped them set business profit goals that allowed them to take home the income they wanted while still covering tax and business growth.

The Result?

  • They now pay themselves £3K+ per month comfortably
  • Their next tax bill is already planned for – no stress!
  • Their mortgage application looks stronger
  • They finally feel in control of their finances instead of constantly reacting to surprises

f you’re running a business but struggling to make your hard-earned cash actually work for you, we can help. Let’s get your finances working for your life goals – not against them.

Call The Accountancy Office  on 01386 366741 or book a call for a time that is convenient for you.

International Women’s Day 2025

Posted on by Sarah

Mary Harris Smith: The First Female Chartered Accountant

In a profession historically dominated by men, Mary Harris Smith stands out as a true trailblazer. Born in 1844 in London, she became the world’s first female chartered accountant but her path to recognition was far from straightforward. Her story is one of determination, resilience, and an unwavering belief in her own abilities.

Early Life and Career

Mary Harris Smith was born into a middle-class family and showed an early aptitude for numbers and business. In the late 19th century, opportunities for women in finance were virtually non existent, but Mary refused to let that stop her. She trained as an accountant and began practicing independently, something almost unheard of for a woman at the time.

By the 1880s, Mary had established her own practice, offering services in bookkeeping, auditing, and financial advice. Her skills and professionalism were widely respected, yet her gender remained a barrier to full professional recognition.

In 1888, Mary applied to join the Institute of Chartered Accountants in England and Wales (ICAEW) – the professional body for chartered accountants. Despite her experience and impeccable credentials, she was rejected solely because she was a woman. The ICAEW’s rules at the time explicitly restricted membership to men.

Undeterred, Mary continued her work and reapplied several times over the next few decades. Each time, she was met with the same response – women were not allowed.

Breaking the Glass Ceiling

It wasn’t until after World War I, when attitudes toward women’s roles in society began to shift, that Mary’s persistence paid off. In 1919, the Sex Disqualification (Removal) Act was passed, making it illegal to exclude women from professions solely based on their gender.

Mary wasted no time. In 1920, at the age of 76, she was finally admitted to the ICAEW, becoming the world’s first female chartered accountant. It was a historic moment, not only for Mary but for women in the accounting profession worldwide.

Mary’s Legacy 

Mary Harris Smith’s achievement paved the way for future generations of female accountants. Her story is a testament to the power of perseverance and the importance of challenging outdated norms.

Today, women make up nearly half of all chartered accountants in the UK – a remarkable shift that can be traced back to the doors Mary Harris Smith pushed open over a century ago.

Mary’s legacy reminds us that progress is often hard-won but with determination and resilience, change is possible.