When you find cash you weren’t expecting, whether it’s a stray tenner left in a jacket pocket, or a few quid down the back of the sofa, it’s a win, right? Well, imagine how a hardworking business owner would feel when their accountant finds a considerable sum of hidden cash which they are entitled to from their business.
We find that hidden cash by doing a thorough review with each new client and ensuring their business is structured effectively and is strategically robust. When is the last time you looked at tax planning for you personally as well as your business? Are you protecting your wealth in the most efficient manner.
Not knowing how the numbers can be used to make a business work better is possibly the easiest thing to set right and realise where efficiencies can be made and tax relief applied. There are many new things to start doing to release cash that can be used to help in your personal life or reinvest in the business.
Alongside Shaun Pegler, I oversee the Accounting Services team and we discuss ways to improve efficiency and identify areas to improve financial health for our clients, and we are bewildered when talking with new prospects who haven’t had the best advice and have missed out on potential opportunities.
Typical examples of missed opportunities include:
- Prospects not being told about alphabet shares and so they were able to restructure the shares and improve the remuneration structure and get more cash out of the business and pay less tax.
- Claiming annual employment allowance which in some cases wasn’t being claimed, going back two, three or four years, meaning in some cases thousands of pounds being refunded.
- Changing how a business invoices on sales of product and maintaining cashflow for as long as possible and ensuring on the correct VAT scheme.
- Being unaware the business could make pension contributions and get tax relief.
There are so many areas to consider which may have been in place for years, such as checking you are on the correct remuneration package or that the structure/shareholding of the business is appropriate.
We start by checking that clients have regular figures which are timely, accurate and understandable. Quite often we find that the absence of appropriate reports resulted in errors, leading to the wrong decisions being made as a result. Our team can help to get clients set up on or transfer to a software package, such as Xero, to bring your numbers to life.
With the challenging times businesses are currently going through, whether connected to the cost-of-living crisis or energy costs, businesses are understanding the need to be agile, so they are able to adapt quickly to changes in their market place.
Our mantra is “We make your success our priority” so it’s important for us to understand right from the beginning what success looks like and whether a business needs help to bring their vision to life. To achieve this, we involve the relevant expert when required, whether it’s from our Business Advisory and Corporate finance team to help with their strategy and plans, or the Tax team to help with the structure of the business if it’s not set up in a tax efficient way.
Finding a pot of cash at the end of a rainbow may not be very realistic but we make it our mission that pockets of cash are not left hidden for our clients.
Nikki Cairns is partner and joint head of accounting services: book a free advice clinic with Nikki or Shaun by calling 01242 776000 or emailing clinics@randall-payne.co.uk.
