PRIME business club

Buried away in the detail of the Chancellor’s budget report is notice of the end of a very valuable incentive for those struggling to work their way off benefit. From April 2012, the 50-plus element will be removed from Working Tax Credit. This means PRIME clients won’t be able to get it any more. This could mean a cut of up to £1,965 in their income in the first year back in work.

Working Tax Credit is a kind of reverse income tax that you should get if your household income falls below a certain level. For the newly self-employed it provides a useful safety net, as it means you know your income won’t fall to zero even if your net profit does. In the early stages of a new business this is very reassuring, as the risk of low or negative income from the startup is real.

Since the 50-plus element is only available to those who are returning to work after previously being on benefit it seems a very odd thing to cut. And it won’t do much to help reduce the public sector deficit, since you’ve only ever been able to claim it for your first 12 months back in work. After that it ceases automatically anyway.

The Chancellor hopes to save £35 million in the tax year 2012-2013 by this measure, and £40 million a year thereafter.

Lets’s hope all of this money returns in some way to those striving to get themselves back into work by their own efforts. It’s a very strange thing to remove one of the few forms of financial assistance that was already well-targeted at those actively trying to work themselves off welfare dependency.

On a more positive note the Chancellor announced that the personal income tax allowance is to rise from April 2011 by £1,000 to £7,475, removing some 880,000 people on the lowest incomes from having to pay income tax at all. Eventually he hopes to raise the allowance to £10,000, but gave no definite date.

This measure should help many self-employed people, since most are set up as sole traders and are taxed primarily through income tax, filling in the self-employed self-assessment form.

There’s more about the budget on the in the Resources area on this web site.

Working Tax Credit - current maximum rates per year
(what you actually receive tapers off as your income rises. The Chancellor has also changed the taper “withdrawal rate” too, up two per cent to 41 per cent, so in future you will lose money faster).

Latest Working Tax Credit rates and thresholds

Full budget report on HM Treasury site (as big PDF) Stuff about ending the 50-plus back-to-work element is budget policy decision 41 in table 2.1 on page 48.

The 2010 Budget report from the PracticeWeb team is now available on the Resources area of this web site.

Quick links

• Introduction and Budget highlights
• Business taxation
• Company cars
• Mileage allowances
• Value added tax
• National insurance contributions
• Income tax and personal savings
• Capital taxes
• Excise duties
• HM Revenue and Customs powers
• Other measures announced
• The Economy
• 2010 Tax and business calendar

2010/11 Tax credits and allowances

These are being updated at the moment. So for the next few days this page may still show the current year for Working Tax Credit and Child Tax Credit
But almost all the figures for the forthcoming tax year were pre-announced in the 2009 Pre-Budget report.

PRIME has teamed up with UK business set-up specialist Clever Gecko to offer our members a FREE Health Check for their businesses.

To get this offer go to the special PRIME landing page.

Business Doctor is predominately aimed at those people who have already started their own business and would just like some advice on how they are doing. The check-up will give you an opportunity to discuss any concerns you may have about your business but also for the Doctor to highlight issues that may not be obvious to you.

If you are still just contemplating starting your own business then Business Doctor can still help by assessing your business idea for viability.

Clever Gecko is one of the UK leaders in business start-up services, dealing with every type of business from a window cleaner to a corporate consultancy. With unrivalled access to their Partners a Clever Gecko client can, on average, save up to 54% on things like stationery, printing, logo design, website design/hosting and insurance. So whatever your business, a call to Clever Gecko is probably one of the best calls you’ll ever make.

They understand that starting your own business can be a very stressful time; full of questions,uncertainties and worries and sometimes you just need a helping hand. Their friendly, plain language, hands-on approach makes them perfect for people starting out in the business world.

Disclosure: We are not taking any commission or affiliate fee on this offer to enable the maximum saving to be passed on to you. PRIME has asked Clever Gecko to offer this service FREE to our clients so that they receive the greatest benefit.

The City Business Library has just moved, and is running a series of free events of interest to small business startups in its swanky new but historic premises.

Located in the City of London near Moorgate, CBL is the largest specialised public reference library in the country dedicated to practical business information. You can use it for free and there are no membership requirements.

The new address from Feb 2010 is: City Business Library, Aldermanbury, London EC2V 7HH. Map of new location (PDF)

Here are some of the upcoming workshops

Setting up a Limited Company

Wednesday 3 March
2.15 – 4.15pm
Talk

Her Majesty’s Revenue & Customs staff will look at the tax implications of setting up a limited company in the UK.
Free - but you must book in advance

Web Optimisation and E-Marketing

4 March
13.30 -4.30pm
Afternoon seminar

Business Link staff will use this non-technical workshop to help small businesses to learn about marketing your business through good website design and by optimising to gain improved ranking on Google; about domain names, key words and email marketing, and about the business uses of social networking.
Free - but you must book in advance

Importing and Exporting    

Wednesday 10 March
2.15 – 4.15pm

Her Majesty’s Revenue & Customs staff will outline customs procedures and possible ways of reducing costs in relation to the import of goods into the EU and export outside the EU.
Free - but you must book in advance

Low cost marketing 

Thursday 11 March
10-12 noon

Business Link staff www.businesslink.gov.uk/london will help small businesses discover the most cost-effective ways to market their businesses.
Free - but you must book in advance

To book a place on any of these courses, telephone the City Business Library on 020 7332 1812 or email cbl@cityoflondon.gov.uk

NESTA Age Unlimited Scotland

NESTA, a public body established by Parliament to encouraged innovation and funded with Lottery money, has launched a new programme in Scotland called Age Unlimited.

Here’s what it says:

We are looking for people in their 50’s and 60’s in Scotland to come forward with new ideas that could be turned into live community projects which would improve the lives of older people (people in their 70’s, 80’s and above). The programme aims to test how older people can be engaged in the design and delivery of innovative new services that could improve older people’s health and well-being and reduce dependency on costly mainstream public services.

Maybe you have experience as a carer or volunteer with older people and have skills and experience you’d be willing to share. Maybe you are looking for a new challenge? If so, we want to hear from you. In return we’ve got support and funding to make your idea become real.

More information and the application form for the Age Unlimited programme can be found online: www.nesta.org.uk/age-unlimited-scotland. If you have any queries or would prefer to complete a paper application, please call 01382 229521 or email ageunlimitedinscotland@nesta.org.uk and we will post you a form. Our application closes on 1st March 2010.

Read the recent press coverage in The Herald here: Sheena was a punk rocker…

HMRC’s online calculator for working tax credit and child tax credit is back online, after a gap of several years. It allows you to enter your details to see if it’s worth claiming - you’re not asked for a name. The over 50s are one of the groups most likely to NOT claim tax credits they are entitled to.

Alternative link if the first one doesn’t work.

Lots of interesting charts about how the UK’s population is using the Internet, phone and other digital media in Ofcom’s annual communications market review.

Fast Internet access, or “broadband”, is now obtainable almost everywhere in the UK, so the key measure is adoption, or how many take it up. Overall take up of broadband reached 68 per cent of households in the UK by the end of the first quarter of 2009. This is up from 58 per cent on the previous year, an increase of 17 per cent.

Adoption in highest in England (70 per cent of households), but the other nations are catching up fast. Take up of broadband rose by 13 per cent in Scotland (up from 53 per cent to 60 per cent); by nearly 25 per cent in Northern Ireland (up from 52 per cent to 64 per cent); and by a third in Wales (up from 45 per cent to 58 per cent).

The total number of UK fixed broadband connections increased by 10.7 per cent to 17.3 million during 2008, up by 1.7 million on 2007. Take-up of mobile broadband also grew substantially over the year. More than 1 in 10 households (around 3 million homes) had a mobile broadband connection by the end of Q1 2009. Of these, three-quarters (75 per cent) also had access to broadband through their landline. This suggests that many consumers are using mobile broadband to complement their landline connection rather than replace it.

AGE GAP NARROWS FOR TECHNOLOGY USE

Ofcom’s research suggests that the gap in take-up between age groups is narrowing. It was among older consumers that technology take up grew the fastest during 2008. For mobile phone, digital TV and internet take-up, the largest growth in absolute terms wasamong the 65+ age group. The only other age group to see double-digit growth across all platforms was the 55-64 year olds.

What sectors will suffer worst as people cut back their spending in response the economic downturn? Ofcom polled people as part of it’s recent research into technology use, and produced some interesting answers.

When asked which items they were likely to cut back on in the recession, 47 per cent chose to cut back on going out for dinner, 41 per cent on DIY and 41 per cent on holidays. This compares with only a fifth (19 per cent) who would cut back on mobile phone spend, 16 per cent on TV subscriptions and 10 per cent on their broadband services. Only spending on groceries and toiletries/cosmetics were less popular economies to make.

Ofcom Communications Market Report 2009

Two big changes affecting the way government deals with small business have emerged out of the current political turmoil.

Firstly Alan Sugar, the business star from TV’s The Apprentice has accepted a new role promoting enterprise from within government. The role is unpaid, but Sir Alan is expected to accept a peerage, which will enable him to speak on business topics from within the House of Lords.

Text of official announcement below.
Press comment: Sugar

Secondly the government department with overall responsibility for business in the UK, BERR, is disappearing in a merger with DIUS, the department in charge of higer education. The new merged department, called BIS or “Business, Innovation and Skills”, will be taking over both roles - under the control of the current Business Secretary Peter Mandelson.

From BERR site

Sir Alan Sugar has been appointed as the Government’s Enterprise Champion.

Areas he may look at include access to finance, prompt payment, how to handle the downturn and how to start a new business. The post will be unpaid.

New Department for Business, Innovation and Skills (BIS)

The Government has today created a new Department for Business, Innovation and Skills whose key role will be to build Britain’s capabilities to compete in the global economy. The Department will be created by merging BERR and DIUS.

According to the official announcement the new department’s tasks include:

Advocating the needs of business across government, especially of UK small businesses;

Investing in skills … to help people through the downturn and to prepare Britain for the future.
More in BERR press release

Press comment: BIS

Expect the fear of a pandemic and measures taken to combat it to have an impact well in advance of the disease itself, if or when it arrives.

Most of the advice so far seems to be aimed at large businesses, but many of the principles still apply. Have everyone’s mobile phone numbers to hand, backup computer and web data properly in case services go down. Observe enhanced hygiene practices. Think through the implications of things like restrictions on travel, the closure of venues and the unavailability of key services and staff.

Time for preparation not panic (PDF) - thorough discussion of possible impact from insurance broking giant and risk management specialist Willis.

Gartner business continuity blog Frequent updates but from a very American perspective

Basic facts about influenza pandemics - PDF briefing from European Centre for Disease Control (ECDC)

Personal protective measures - PDF briefing from ECDC goes into more detail than most

Latest on outbreak from European Centre for Disease Control

The Pitch 2009 is a competition run by Sift Media, the company behind the useful BusinessZone.co.uk small business web site. Its aim is to find “Britain’s most innovative small companies”. The winner gets a package of business support including practical help on PR, marketing and doing business online valued by the organisers at £50,000.

To enter, your business must be based in the UK, established for less than three years and employ no more than 20 staff. If you are just starting you don’t have to be fully up and trading yet, but “you must be able to demonstrate a sound business plan and evidence that there is a proven market for your product or service”.

According to the application form “the judges will look for innovation, engagement with customers, sound financial and business planning, and an understanding of where the opportunities exist in the market for your product or service”.

The entry form is a Microsoft Word document that you can download here. Any queries contact Sift Media’s Rita Andrews on 0117 915 9619.

Shortlisted entrants get to attend their nearest regional heat, where they pitch to a live panel Dragon’s Den style. These are taking place on 9 June 2009 in Bristol, 17 June in Manchester, 23 June in Glasgow, 8 July in Birmingham and 14 July in London.

The final will take place in central London during Enterprise Week, the week of 16-22 November 2009.

The application closing dates for the regional heats are as follows:

• Bristol: 18 May
• Manchester: 25 May
• Glasgow: 1 June
• Birmingham: 15 June
• London: 22 June

Chichester College have been awarded funding by SEEDA (the South East England Development Agency) to run an exiting new project called SEED in the South East. 

The project, which runs until December 2010, will be self-employment focused and aims to engage and support 50 unemployed or economically inactive clients, that are 19yrs or over, from areas of deprivation within Lewes and Newhaven. 

Benna Madan is the community business coach  who will be supporting these people. Benna is looking for people who fit the above criteria  that she can help overcome individual barriers in their transition to self-employment? 

If you are interested you will need to move quickly as this unique opportunity only exists for the first 50 clients that are identified.  

Please email Benna Madan if you have any queries.

Benna Madan
Community Business Coach for Lewes/Newhaven
SEED project for Chichester College
info@bennamadan.co.uk

More than five million people are working from home after finishing their day job, according to a report published this week.

The survey, commissioned by the office products giant Staples, and carried out by Enterprise Nation, the UK’s largest website for home based business, confirms that the “5 to 9″ trend is spreading across the country.

Of those 5-9ers questioned, 50 per cent said their business was growing and over 60 per cent expected to be going full time within the next 12 months.

Enterprise Nation Founder Emma Jones said: “We were amazed by what we found. Although we knew there had been a tremendous growth in home business, we had no idea that much of this was coming from the 5 - 9 trend.

“What’s particularly significant is that the current economic climate is the impetus behind this trend. For some people it’s about increasing their income to cope with a partner’s redundancy while others felt uncertain about their future career prospects and wanted to make sure they were better placed if they lost their job.”

There’s also the added attraction that building a business at night and weekends from a spare room is low risk and low cost, allowing people to increase sales, confidence and cashflow, whilst holding onto a salary.

“In a recession people often set up their own business as a way of taking control of their own life again. But the current downturn is so severe that people are being more cautious, hanging onto their full time jobs and testing the water first before making a decision. This clearly makes good business sense.”

Staples commissioned the research after noticing a shift in shopping patterns with more people visiting their stores after 5pm.

Yetunde Ige, Staples Head of Marketing said: “Clearly this trend is something that we’re interested in as our stores are open late. As a result we are looking to launch a 5-9ers club, which will reward people shopping after 5pm and hopefully be a real benefit to those trying to start a business in their free time.”

A free copy of ‘Working 5 to 9 - how to start a business in your spare time’ is available at www.enterprisenation.com

HM Revenue and Customs (HMRC) now has the power to raid ordinary homes without warning - if you are conducting a business somewhere on the premises. Running a home business is of course not itself illegal. The idea is to allow tax inspectors to check up on what you are doing and have a look at the records you are meant to be keeping.

These new powers were first mooted over a year ago, and came into force on the 1st of April 2009. The new rules give the tax inspectors from the Revenue side of HMRC similar powers to those Customs & Excise have long had against smugglers and VAT evaders. Basically they can enter your home without notice if they suspect you of wrongdoing.

According to Sue Holmes, head of national tax investigations at accountancy firm Smith & Williamson, “The many thousands of business people and sole traders who claim expenses for ‘use of home as an office’ should recognise that from next month, HMRC has the right to enter their home without prior warning to inspect business records.”

This article in the Sunday Times describes the changes - and the new scale of penalties, in more detail.

So what records should you keep?

Here’s HMRC’s own guidance on the records needed by the self-employed.

And here’s its basic guide to tax and self-employment.

Also useful if slightly out of date is The No-Nonsense Guide to Government Rules and Regulations for Setting up Your Business which you can download free from Business Link.

If this is all sounding a bit complicated this brilliantly simple sheet of paper from InBiz shows you how to calculate what you probably most need to know - how much tax you will have to pay for the year.

Scams are big business. The combined turnover for some firms closed down recently for conducting fake-charity publishing scams came to over £50 million. The Office of Fair Trading has now published new advice for businesses to help them avoid losing money to criminals.

“When targeting businesses, the scammers are using increasingly sophisticated techniques”, according to Mike Lambourne, head of the OFT’s Scambusters Team. A new trend is the recording and editing of phone calls, which are then used when hounding the victims for payment.

The OFT advises “never agree to anything in a rush, and remember that it is possible to enter into a legally binding contract over the phone.”

Top business scams

There is detailed information on how the main types of scam work on the OFT site. Here are links to the most common.

• The business directory scam
• Office supply scam
• Domain name scam
• Charitable publication scam
• The fake invoice scam
• Bogus government agency scam
• Premium rate scam

Meanwhile the next episode of BBC 3’s The Real Hustle transmits tonight, the 26 Feb 2009, at 9:45pm. This series shows how easy it is to be taken in by accomplished con artists, and is well worth watching to make you more scam-aware.

Here are the top 20 scams revealed by the programme, as voted for by fans.