Greenwood Bookkeeping Services

01/01/2025

Happy New Year 2025!

Wishing everyone a year filled with happiness, health, and success. May this new year bring fresh beginnings, cherished moments, and endless opportunities for joy!

23/12/2024

🎄✨ Merry Christmas from Greenwood Bookkeeping! 🎅🎁

To all our wonderful clients and friends, thank you for your trust, support, and friendship throughout the year. 💖 Your success is at the heart of everything we do, and we’re so grateful to be part of your journey.

Wishing you and your loved ones a joyful holiday season filled with laughter, love, and a little time to relax! 🕊️💼

Merry Christmas! 🎉

02/12/2024

It's quiz time! And we're adding a dash of festive cheer to our usual number crunching!

Here are three festive-related expenses:

A reindeer mug you gift your employees
A Staff Christmas Party
Taking a client out for a festive lunch

Two of these can be tax deductible for companies in the UK...but one is definitely on Santa's naughty list. Can you guess which one?

Alright, pencils down, it's answer time!

The reindeer mug is a trivial benefit - a small, personal celebration gift for an employee. If it's low cost, you can apply to HMRC to not pay tax or National Insurance on this. So, yes, it's tax-deductible! ✔️

The staff party can also be claimed if it's an annual event like a festive party, open to all staff, and costs less than £150 per guest. So, get your party hats on because this one's tax deductible too! ✔️

However, treating a client to lunch? I'm afraid Santa says no. There's no tax relief available on the cost of entertaining anyone other than bona fide payroll employees. So, this one's not tax deductible. ❌

So, how did you do? Drop your score in the comments!

Remember, we're here to make your bookkeeping journey a bit more fun (and much less taxing!).

22/11/2024

Staff Christmas Party: A Festive Tax Deduction Opportunity!

Are you planning a Christmas party for your staff to show appreciation for their hard work? Here's some festive cheer from HMRC: you can claim the cost of your staff Christmas party as a business expense!

Here's how to stay on HMRC's "nice" list while enjoying the celebrations:

🎄Keep it under £150 per person, including food, drinks, entertainment, and even transport costs. Stay within the limit to ensure it's fully deductible and tax-free for employees.

🎄Invite all employees—The party must be open to all staff. If you have multiple locations, you are allowed a separate event for each location as long as all staff can attend one event. Remember, inclusivity is key to making everyone feel appreciated!

🎄It's an annual event – Christmas parties, summer BBQs, or similar annual get-togethers qualify.

Top Tip: Remember, the £150 limit is a tax-free allowance. Spending more than £150 per head makes the whole cost taxable. So, staying within the limit is a win-win for you and your employees!

18/11/2024

Do I Need a Bookkeeper or an Accountant for My Small Business? 🤔

If you're a sole trader, the question of whether to hire a bookkeeper or an accountant often comes up. Here's some insight to help you make the right choice for your business!

➡Bookkeeper: A qualified bookkeeper can be a fantastic asset for managing your day-to-day finances, which includes tasks like recording transactions, managing invoices, reconciling bank statements, and completing your year-end accounts. They are adept at handling your business's routine financial operations. Many bookkeepers are also skilled in preparing and submitting your self-assessment tax return, which is crucial for staying on top of your tax obligations.

➡Accountant: While an accountant typically takes on more complex financial tasks, like strategic tax planning, auditing, and detailed financial analysis, they might not be necessary if your business is relatively straightforward. Accountants are invaluable for businesses with more complex needs, such as those with employees, larger turnovers, or plans for significant growth.

➡The Bottom Line: A qualified bookkeeper might be all you need for a sole trader with straightforward finances. They can manage your bookkeeping, year-end accounts, and tax returns efficiently, allowing you to focus on growing your business.
Remember, the right financial professional can save you time, money, and stress—so choose wisely! Making the right choice can bring a sense of relief, knowing that your business's financial health is in good hands.

14/11/2024

What is the difference between turnover, gross profit and net profit? Here's a quick explanation:

➡Turnover: this is the total amount of money received.
➡Gross profit: this is your turnover minus any costs associated with making the sale.
For service-based businesses, this might be a stock image purchased for a project or
another direct cost.
➡Net profit: this is your gross profit minus your business expenses.

13/11/2024

It’s Global Bookkeeping Week!

This week, Global Bookkeeping Week celebrates the unsung heroes of the business world: bookkeepers! Whether you're a sole trader or a small business owner, your bookkeeper works behind the scenes, keeping your finances organised and your stress levels low.

Bookkeeping isn't just about numbers; it's about helping businesses make informed decisions, stay compliant, and thrive. Let's celebrate all the dedicated professionals who, despite the challenges, bring clarity to the chaos and make running a business that little bit easier!

11/11/2024

We remember those who lost their lives in wars and conflicts to give us the freedoms we enjoy today.

06/11/2024

**Reminder for Sole Traders: Don’t Forget to Claim Your Mileage!**

If you use your car for business purposes, make sure you’re not leaving money on the table! HMRC allows sole traders to claim mileage expenses, reducing your taxable income and saving you a significant amount on your tax bill. Here’s what you need to know:

1. **Mileage Rates:** HMRC’s approved mileage rates for business travel are:
- 45p per mile for the first 10,000 miles
- 25p per mile after that

2. **What Counts as Business Travel?**
- Traveling between different work sites, visiting clients, or any journeys required for business purposes are eligible.
- Note: Commuting from home to your regular place of work doesn’t count.

3. **Keep Good Records:**
- Track the date, purpose, and distance of each journey. Good record-keeping is essential to support your claim in case of an HMRC inquiry!

31/10/2024

Here are some announcements in yesterday's budget which may affect business owners.

➡Increase to Employer National Insurance contributions.
Employer National Insurance contributions will rise to 15% in April 2025, and the National Insurance primary threshold, which is when employers begin to pay NI, will be lowered from £9,100 to £5,000. Although the NI threshold has been reduced, the amount of National Insurance a business can offset will increase as the employment allowance will change from £5,000 to £10,500.

➡Changes to the minimum wage
The National Living Wage for workers over 21 will increase by 6.7% in April 2025 to £12.21 per hour, worth an extra £1,100 a year for a full-time worker. The National Minimum Wage for 18 to 20-year-olds will go up by 16% to £10 per hour.

➡Income Tax Personal Threshold
The freeze on Income tax and National Insurance thresholds will end in April 2028. From 2028 - 29, personal tax thresholds will be updated in line with inflation.

➡Business Rates
The current 75% discount on business rates is set to end in April 2025, this will be replaced by a discount of 40%. In addition, there is a plan to introduce permanently lower business rates for high-street retail, hospitality and leisure properties from 2026-27.

➡Capital Gains Tax
Capital Gains tax rates for disposal on or after 30 October 2024 will increase from 10% to 18% and the higher rate from 20% to 24%.

➡HMRC changes
The interest rate applied to tax that is overdue will increase to encourage prompt payment. In addition, HMRC criminal investigation work will increase by hiring more compliance officers.

➡Making Tax Digital update
The budget included a Making Tax Digital (MTD) update, with the Labour government reiterating its commitment to delivering MTD ITSA (Making Tax Digital for Income Tax Self-Assessment) on the current timeline: 2026 for those with a turnover of over £50,000 and 2027 for those with a turnover of over £30,000-£50,000. In a new announcement, MTD ITSA will also be rolled out to those with a turnover of over £20,000-£30,000, joining by the end of this parliament.

31/10/2024

28/10/2024

Keeping your books in order might seem tedious, but it’s one of the best investments you can make for your business! Here’s why good bookkeeping is more than just record-keeping:

➡Financial Clarity: When your books are accurate, you always know exactly where your money is going and what’s coming in. This clarity is the backbone of smart financial decisions!

➡Tax Time Made Easy: No more scrambling at tax season! With clean, up-to-date records, you have everything you need to file correctly and avoid those dreaded last-minute headaches.

➡Cash Flow Management: Good bookkeeping helps you stay on top of cash flow, so you can pay bills on time, manage payroll, and keep things running smoothly.

➡Growth Opportunities: Want a business loan or investor funding? Accurate financial records show lenders and investors that you’re reliable and organised—a key factor in getting support for your growth plans.

➡Less Stress, More Focus: When your books are in order, you can spend less time worrying about finances and more time on what you do best: running and growing your business!

Whether you handle it yourself or outsource bookkeeping to a professional, good bookkeeping gives you control, peace of mind, and a clearer path to success. Are you ready to make it happen?