Small Business Accounting

Are you giving out the wrong message for your business?

Posted on 08/12/2023 by Alison Harrison

I recently saw a leaflet for something I could be have been interested in. At the point of taking the next step I looked for an email address to email to arrange a meeting to discuss their offering. My impression of this business suddenly did a nose dive on the professionability scale. They had a hotmail email account. Was this a part time business? Another person involved in this business had an email address sexysuzy@……. For the cost of a domain running at around £6 for 2 years, why had they not grabbed it?

I then saw that they had a website with the business domain so why were they not using the domain with an associated email address? This person had a good website so I proceeded to email.

Not getting a reply I telephoned the number on the website but it went to the home phone answerphone. Had I got the wrong number?

It took three weeks for an email reply which was full of apology. Was this person taking their business seriously? Could they cope with the work I was proposing to give them?

We met up and he gave me his business card. Oh dear! I think it was a DIY job from Staples and was completely mismatched to the website. It was poorly thought out, poorly printed and was misaligned. It gave incomplete information and contained spelling mistakes.

This business was giving out all the wrong messages before we had had the opportunity to work together.

The meeting went well but the jury is still out as to whether to use him. I have my doubts.

What is the point of all this? This person could have made a much stronger impact with so little effort.

Had he had a consistent brand image – domain, logo, standard of presentation, my impression would have been very different.

Had the telephone been answered by a human or by a professional answerphone, my impression would have been very different.

Had the initial response been earlier and the final proposal sooner after the meeting, my impression would have been very different

By the time we got to the end of the sale process, I had lost confidence in this person which is such a shame. Time will tell if I made the right decision.

Is your company dormant?

Posted on 04/12/2023 by Alison Harrison

Dormant Companies are defined in 2 different ways by Companies House and HMRC:

A Dormant company at Companies House is if any transaction goes through the business, then you are not dormant. There are exceptions to this such as paying the fee for the Confirmation Statement, changes to shareholding etc. meaning if you have bank charges going through when you haven’t made any sales, then your company is not dormant.

HMRC state that if you are not trading then you are dormant meaning if you have don’t have any trading income or expenses you are classed as dormant with them.

If you have any further questions about dormant companies then please let us know.

When to incorporate

Posted on 30/11/2023 by Cathy Shults

This is a question we get asked frequently. Currently sole traders have to pay personal tax on their profits, Class 2 national insurance on profits over £50,000 at 2% and Class 4 national insurance on profits between £9,501 and £50,000 at 9%. Sole traders have to pay a payment on account if their annual tax bill exceeds £1000.

Limited companies do not have to pay payments on account or national insurance but have to pay 100% of their corporation tax 9 months and 1 day after the year end at a rate of 19% on profits.

Limited companies can have shareholders unlike soletraders. When taking the combined personal tax and corporation tax liability for limited companies vs tax and national insurance for soletraders, the rough tipping point is if you have profits of £12,000 or more, it could work out to be more efficient for tax purposes to be a limited company.

What is a registered office and do I need one?

Posted on 24/11/2023 by Alison Harrison

What is a registered office address?

A registered office address is a legal requirement of all Limited Companies and Limited Liability Partnerships (LLPs) incorporated in the UK. Its purpose is to provide Companies House and HMRC with an official address for delivering statutory mail and legal notices. It must be a full, physical postal address in the same part of the UK where your company is registered i.e. England and Wales, Scotland or Northern Ireland. Both residential and non-residential addresses are permitted but many people prefer to keep their homes private.

Your registered office does not have to be in the same part of the country where your main trading activities are carried out, nor do you ever have to visit it. It is simply for receiving official mail and storing statutory records for inspection purposes.

Why do I need a registered office for a limited company?

Legally required under UK company law
Official mailing address for statutory correspondence.
Details are placed on public record to create corporate transparency.
Statutory records and registers must be kept and made available for inspection at the registered office.

You can change your registered office at any time after company formation as long as it stays in the same UK country.

Can I use my home as a registered office?

You may use your home for this purpose but it is not mandatory, nor is it the best choice. Ideally, you should use a non-residential address for reasons of privacy and professionalism.

The benefits of a non-residential registered office are:

Due to the public disclosure of corporate information, the use of a residential address could result in unwanted visitors and unsolicited mail at your home.
More likely to be perceived as an established, credible business if you have a professional registered office address.
Draws a clear line between work life and home life.

If you would like Harmonea to be your Registered Office address, please contact us.