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The Four Foundations of Making Tax Digital

The Four Foundations of Making Tax Digital

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The Four Foundations of Making Tax Digital

It may start to feel like everyone is talking about Making Tax Digital at the moment. However, it is a really important thing for all business owners to be aware of as it will affect every business owner and every business. In this blog post we thought we would talk about the four foundations of Making Tax Digital. To enable you to gain a better understanding of why it was introduced and what it will achieve.

Better Use of Information

Making Tax Digital means that organisations will be able to see the information that is held by the HMRC. These organisations will also be able to check if the details they have entered are complete, up to date and correct. HMRC will then be able to use this information to tailor the services it offers customers. This will be according to their individual circumstances.

Tax in Real Time

With Making Tax Digital, organisations will no longer have to wait until the end of the year, or longer, to find out how much tax they should pay. Instead HMRC will collect and process the information that affects tax as close to real time as possible. This will help prevent errors and stop tax due or repayments owed building up. This should make paying tax easier for business owners.

A Single Financial Account

It is planned that by 2020, HMRC customers will be able to clearly see a comprehensives financial picture in their digital account. This will be very similar to the financial picture they can see through their online banking. This should make it easier for business owners to review their business financially and make better informed financial decisions.

Digital Interaction

HMRC customers will be able to interact digitally with HMRC staff on days and times that suit them. Digital record keeping software will also be linked directly to HMRC. This will allow business owners to easily send and receive information to HMRC from their own software as and when it suits them.

 

If you have concerns about Making Tax Digital or would rather bury your head in the sand, then why not contact us now. We can help you understand Making Tax Digital and take away that stress and worry for you.

Start 2019 Right With These Two Essential Bookkeeping Tips

Start 2019 Right With These Two Essential Bookkeeping Tips – Bookkeeping in Peterborough

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Start 2019 Right With These Two Essential Bookkeeping Tips

Here at Direct Peak we love numbers, accounting, finances and bookkeeping in Peterborough. However, we know that many small to medium business owners hate bookkeeping. This is often the most neglected element of a business. While it may not be fun and it certainly isn’t sexy – keeping on top of your bookkeeping can save you time and help you better manage your business. It will also enable you to make more efficient decisions for your business.

With 2019 upon us, don’t neglect your books this year. Start the year the right way, by following these two essential bookkeeping tips. Come December, you’ll thank us for it!

Keep It Separate

As a business owner you need to make sure that your business and personal accounts are kept separately. While it may be tempting to give clients your bank details and for the money to go into your personal account – this will not help you or your business in the long run.

Make sure you don’t pay personal expenses from your business account. No matter how good the deals are to book a holiday from your company credit card. Avoid it at all costs! Make sure you keep both accounts completely separate. Then you’ll find it much easier to view where your business is at and what is happening, financially wise, in your business.

Keep On Top

It is okay to hate bookkeeping. However, it is not okay to put it off. The longer you leave it, the more of a mess you will have to deal with. Also,the harder it will be to find errors and solutions in your records, Not to mention that missing invoice, bank statement or receipt.

If you really hate bookkeeping and keep finding that you are putting it off, or dreading doing it – then why not use the services of a professional bookkeeper in Peterborough? Even if you don’t need our full accounting services, you can still use our bookkeepers to keep you on top of your business finances.

 

Remember – you don’t have to do your books to know your books!

What Does Making Tax Digital Mean For My Business

What Does Making Tax Digital Mean For My Business?

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Unless you have been living under a rock, you will have heard about Making Tax Digital by now. From April this year the government has begun live testing of the system and from April 2019 Making Tax Digital will force businesses, which are above the £85,000 VAT registration, threshold to keep all records necessary for VAT purposes online.

So what does Making Tax Digital mean for your business?

Making Tax Digital allows small to medium business owners to keep online records of their income and expenditure for Income Tax purposes and send quarterly updates of this to HMRC via their payment software app.

If you are a business that is currently keeping your records in a cashbook, on a spreadsheet or on non-Making Tax Digital-compliant software then you will need to make changes. As of April 2019 you will need to change your systems and processes because you will no longer be able to log-in to HMRCs website and key in your VAT return figures.

When should I get everything in place for Making Tax Digital?

While many businesses are holding out until the last minute, we would highly recommend that you do not wait for Making Tax Digital to apply legally for your business, but instead voluntarily comply with Making Tax Digital for your VAT so you are ready and prepared for when it does become a legal requirement for your business.

By getting ahead of the Making Tax Digital deadlines you have the time to change your bookkeeping processes and also get to grips with using the new software. If you choose to change to Xero we would be happy to help you move the business across and we can train you and your team so you can get the most from the Xero system.

Changing accounting software can be tricky so to avoid last minute rushes, panics and headaches we would recommend that you give yourself plenty of time to plan for Making Tax Digital, because April 2019 will be here before you know it.

For a free report on what you need to do to comply with Making Tax Digital rules, please click the button below to get a free report.

What Making Tax Digital Means To A Small Business

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Here at Direct Peak, we are specialists Xero accountants in Peterborough. We work closely with our clients to help them get the most from their accounting and bookkeeping. With ‘making tax digital’ discussions and updates taking place all over the media, internet, tv and pretty much everywhere you look – it is not surprising that we are being asked about it.

So, we thought we would put together a few main points to help small business owners understand what Making Tax Digital will mean to their small business;

All businesses and landlords will be affected by Making Tax Digital
Making Tax Digital is compulsory and dependant on your business circumstances will need to start using it in 2018, 2019 or 2020.
You will need to record all tax affairs digitally and this can either be done by using online accounting software, like Xero accounting software, for example.
Your accounts team, finance team or your accountant will provide the information to HMRC on a quarterly basis, as electronic information.
It is expected that Making Tax Digital should reduce the amount of time, effort and stress it currently takes you to prepare and file your taxes.
Making Tax Digital will enable you to get a centralised view of all your tax information, entitlements and liabilities. This means, as a business owner, you will know exactly how much you owe at any point.

While Making Tax Digital will not make filing taxes any less financially painful, it should be faster and easier to prepare taxes, report taxes and file your taxes.

If you’re concerned about how Making Tax Digital will affect your business and what you need to do to make sure your business is ready for Making Tax Digital then please check out this information we have put together.

Alternatively, you can contact us directly and we will be happy to answer any questions you may have about Making Tax Digital for your business.

 

What Are The Benefits Of Accounting In The Cloud?

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Chances are that your clients do most of their business in the ‘cloud’ so why shouldn’t you do your accounting and bookkeeping in the cloud too? It won’t make any differences to your clients as they will still be able to pay you as they have done before, but the benefits to you and your business will be massive game changers.

With cloud-based accounting, using a system like Xero you will only need one file and this can be easily accessed by you in the office, by the team on the road, or from your holiday destination when you are taking a break from the office. It also means that your Xero accountant can access your system from wherever they are. This efficiency that cloud accounting offers can save you time and money.

You don’t need to worry about files being stolen or misplaced because cloud accounting is safe and secure. Cloud accounting systems are also instantaneous which means as soon as changes are made my colleagues, payments come in or bills are paid then it will show on your accounting system straight away. You will know what is happening with your business finances at all times.

We touched on it earlier, but a huge benefit of cloud accounting systems like Xero is that they are completely flexible. This means you can access your accounts from anywhere and from any device that has an internet connection. This means you can check how much money is in the account if you want to place the last order, check a client has made a payment on the way to a meeting with them, or check a payment has gone out to a supplier.

Cloud accounting with systems like Xero needn’t cost the earth and will work on a subscription basis that is affordable.

Why not contact us now to see how Xero cloud accounting could work for you and your business?

Peterborough Small Service Business Award Finalists

Peterborough Small Service Business Award Finalists – Peterborough Small Business Awards

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We recently found out that we were not only nominated for the Peterborough Small Business Awards. We also made it to the Finalist level for The Peterborough Small Service Business of the Year awards category.

As such a new and small business in Peterborough we are really pleased to have been recognised for this award. But, even more so to be the only accountants in Peterborough in the Peterborough Small Business Awards finalist list.

We have stiff competition for the Peterborough Small Service Business of the Year award category. We are against 5 other businesses which are Creative Content Company, Ethos Nursing, So Brand Creative, Streets Art Hire and Wilson & Co Homes. As you can see, these are all really good, strong businesses. Here at Direct Peak we are thrilled to be noticed and recognised in the same category as these other businesses.

In everything we do, we put our client first and help them as much as we can. This is why it feels so good for us to have been nominated for this award by people that see this as something we do. We are grateful to the people that took the time to nominate us – whoever you are!

Later in August a public vote will open and this makes up part of our total score. We will also get a call from a mystery customer, which is another part of our award total. And, on the 3rd September we will be attending an interview with the judges to take about who we are and what we do. The interview makes up the final part of our score.

Then we have to wait until October, when we will be attending the Peterborough Small Business Awards to enjoy a night of food and dancing. This is when we will find out who the winners are for all the awards.

We would like to congratulate all finalists on getting this far in the awards. We wish you the best of luck for the finals and look forward to seeing you all there.

Do Small Businesses Need To Hire A Xero Accountant?

Do Small Businesses Need To Hire A Xero Accountant?

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Xero accounting software recently completed some research to see when business owners felt that an accountant in Peterborough should be hired for business. What they found was some real uncertainty about when an accountant should be hired. There was also uncertainty about the actual value an accountant brings to a small or start-up business.

The biggest reason that small business owners employ the services of a Xero Accountant in Peterborough is because they didn’t start their business to be swamped in financials and paperwork. So it is the first job they take off their list to outsource to someone else.

This makes perfect sense. Why wouldn’t you hire a Xero accountant in Peterborough to take care of the numbers while you focus on what you do best; running a successful business!

As a small business you will always be looking for different ways to save money. You may see a Xero accountant in Peterborough as an additional expense that can be taken out because it is unnecessary.

On paper this may be the case. But tasks such as organising invoices, collating receipts and filing taxes can be extremely time-consuming. This is especially the case for someone without huge amount of experience.

The best Xero accountants in Peterborough will save your money by taking these time-consuming tasks off your hands. However, they will also always be looking at ways that your business can make more money. When you hire a good Xero Accountant you will find them to be more like coaches. They will encourage you to achieve more for your business.

An accountant can add huge amounts of value to your business in various ways. This could be such as increasing your revenue, reducing your expenses, planning your cash flow, helping grow your business and business planning. They can even help at identifying new market opportunities that you may not have considered before.

The added bonus of using could accounting software, such as Xero, is that you don’t need to hire a Xero accountant in Peterborough full-time because they can work remotely using the same date from their own office.

Invoicing Tips From Small Businesses For Small Businesses

Invoicing Tips From Small Businesses For Small Businesses – Xero Accounting Services in Peterborough

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Here at Direct Peak we work closely with Xero and offer Xero accounting services in Peterborough to small and medium businesses. Xero have recently been analysing over 12 million invoices to discover some revelations about getting paid on time. They also asked small business owners for their own tips and tricks too.

As accountants offering Xero accounting services in Peterborough we want to help our clients achieve more with their businesses and accounting software. We have put some of these invoicing tips for small businesses together for you to help you get paid on time or sooner;

However, before we start we’d like to make you aware of the fact that almost half of all invoices are paid late. While some businesses are great at getting paid what they are owed on time, other businesses are waiting weeks or months to get paid. It’s important to bear this in mind when you are reading these tips as it could help you be one of the businesses that gets paid on time, every time.

  • Make sure you send out your invoice payment terms before work begins. In this document you can set out the tone for the transaction such as what forms of payment your will accept, the currency or currencies you deal in. Also include what your late-payment penalties are and if you charge them as well as when from.

 

  • It is essential that you are clear on your due date too as this is when you are expecting the client to pay you by. While 30 days is more common among small businesses, this is changing.

 

  • Between 70% and 80% of businesses give 2 weeks or less as their payment terms and more than half of those businesses request their payment within 7 days. If you are serious about business and work hard to meet your client’s deadlines, why shouldn’t you be paid quickly?

 

  • Remember however, it doesn’t matter how short or long your payment terms are – if you don’t send the bill on time then you won’t get paid. The payment clock doesn’t start ticking until they have received the invoice. Why not use templates through Xero that enable you to speed up your invoicing process so you can send invoices quicker and get paid quicker too?

 

  • It is okay to chase payments from your clients. You don’t need to wait until they are 1 month late before you can start chasing. You could set up a friendly reminder email as the payment due date approaches and then follow up again as they go past the due date. If you don’t have the time to chase, or to save you time from chasing outstanding payments why not use Xero to automatically send reminder emails for you?

 

If you need help with invoicing, your invoicing process or chasing payments then why not give us a call? As a business offering Xero accounting services in Peterborough we would be happy to help you with advice, guidance and support.

Why Small Businesses Should Migrate To Cloud Accounting Software?

Why Small Businesses Should Migrate To Cloud Accounting Software

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There are so many benefits to migrating to cloud accounting software, especially if you are a small business. It not only costs less and makes your work life balance easier but it also streamlines your business processes.

As professional Xero accountants in Peterborough we have helped many clients migrate their accounts to Xero as a cloud accounting software. But there are lots of benefits with any cloud accounting software. We have listed the top four benefits for small businesses;

  1. It’s Easy

Cloud accounting software like Xero has been designed to be easy to use by non-accountants. You’ll also find lots of ‘how to’ videos online that will help you if you get lost or forget how to do something. However if you’re using Xero you are always welcome call out Xero specialists in Peterborough and we will be able to help you.

  1. It’s Safe

Previously with older accounting systems you will have had to constantly back up your cloud accounting software. But with cloud accounting software your accounts are completely safe and secure. Xero will give you a cast iron guarantee that your data is completely safe and secure, whenever you need it.

  1. It’s Flexible

You no longer need to be stuck in the office to do your accounts. You can do them from wherever you are as long as you have an internet connection. You also don’t need to select one person to have the Xero log-ins and have the accounting software on. Everyone in your office can used the Xero cloud accounting from any device if you choose to give them access.

  1. It Increases Productivity

Cloud accounting software like Xero has many plug-ins and innovations that enable the user to produce quicker and more efficient results with less input. You can now have all the business information you need at your fingertips. This will allow you to boost productivity, expand into new markets and make services more accessible or simply make more profit.

 

If you would like a free, no obligation consultation of your accounts and how Xero accounting can help you then please contact us directly.