Category Archives: Uncategorized

Auto Enrolment / Work Place Pensions

This blog applies to any of you that have at least one employee on PAYE.  Please note all my clients are classed as Small or Micro Entities.

You may have seen the adverts stating ‘We’re all in’.  Over the last few years large and medium companies have had to deal with the government’s new Work Place Pension scheme which is often referred to as ‘Auto Enrolment’.  This has been a relatively small amount of companies and small amount of pension schemes holding a large number of employee pensions.  These companies have had the resources to source good schemes with reputable providers for their staff pensions.

However, in 2016 & 2017 all small and micro employers are expected to do the same.  This will involve 100,000s of pension schemes holding a very small amount of employee pensions and because of this, most of the main pension scheme providers are already saying they will not deal with Auto Enrolment for small and micro entities as the administrative costs will be too high.

So here are a few of the key points to try and make things a little clearer and forewarn you of things to come.

Staging Date                                                                                                                                     If you have employees on PAYE you will be receiving a staging date which will be sometime in 2016 or  2017.  This is the date you must start deducting and paying pensions for all applicable staff so you must have a pension scheme and the ability to deal with this in place by that date.

I have the staging dates for all clients who I run payroll for and will be contacting each of you individually regarding this.

For those who run their own payroll you can access your staging date at

Director only employees                                                                                                                 If you trade as a Limited Company and only have the director(s) (up to 5 directors) as employees, you do not need to set up a pension scheme.  You will still receive all the standard letters from HMRC and Auto Enrolment will still apply unless you submit an exemption email.  There is a little admin involved and this will have to be re-done every 3 years.

For all clients I run payroll for, that have only Directors on the payroll, I have the email address and a template of the information that is required for the exemption and will be able to submit this on your behalf.   I will contact each of you individually as you approach your staging dates.

For other Limited companies that this applies to, please contact me if you would like the email address and template.  A small charge will apply or I have a contact who will do this for you for £135 + VAT and give you a certificate of compliance when done.

Note, if you take on an employee you will only have 6 weeks to organise a pension scheme and auto enrolment for that employee before getting a fine.

Who this applies to                                                                                                                          If you have at least one eligible member of staff on PAYE you will need to have a pension scheme in place even if they have already stated they do not want to pay into it.  The employees have to be auto enrolled into the scheme before they can ‘opt out’, (although see ‘Postponement’ below as this can help here). Please note they then only have 4 weeks to opt out and claim back the money that has been deducted from their pay automatically and this has to be done with very specific documents going back and forth to the pension provider.

Postponement                                                                                                                             You can postpone enrolling staff onto the pension for up to 3 months.  This can help if you have temporary staff who you know will leave within 3 months or staff who wish to opt out.  You can only postpone an employee once.

Eligible Staff                                                                                                                               There are 3 tiers of staff:

  1. Those between age 22 to state pension age and who earn more than £10,000.                   These staff will have to be automatically enrolled but they can opt out.
  1. Those between 16 to 74 who earn between £5,772 to £10,000 and those between 16-21 and pension age to 74 who earn over £10,000.                                                                          These staff do not qualify for auto enrolment but can request to ‘opt in’ and you then have to pay their employer contribution.
  1. Those who earn less than £5772.                                                                                        These staff are not auto enrolled but can request to ‘opt in’ but you do not have to pay the employer contribution.

Just to add some further complication, the amounts stated need to be divided by 12 for the monthly pay ie £10,000/12 = £833.33.  If you have an employee in category 2 who one month does some overtime so their pay goes over £833.33 they will get automatically enrolled and employee pension contribution deducted, employer contribution paid.  If they still do not want to be enrolled they will then need to opt out and claim back the money.

All employees who have opted out will be automatically re-enrolled every 3 years and will need to opt out again.

You are not allowed to force or even advise employees to opt out, this can result in a custodial sentence.

Contributions                                                                                                                               The minimum levels of contributions are being phased in and are calculated as a percentage of pay between £5772 and £41895 and are currently as follows:

To 30 Sept 2017          total contribution of 2% with employer paying 1%, employee paying 1%

1/10/17 to 30/9/18       total contribution of 5% with employer paying 2%, employee paying 3%

1/10//18 onwards        total contribution of 8% with employer paying 3%, employee paying 5%

Pension Scheme Providers                                                                                                           As previously stated the main pension providers will not handle this for small and micro entities but there are 3 main trust providers.  These are Nest, Now and Peoples Pension.  I will focus on Nest as it is the only one which is wholly government backed and was set up to deal with Auto Enrolment for small businesses although some large companies such as M&S and BT are also using this.  It is owned by the Indian company Tata.

It is predicted that with 100,000s of schemes coming online with tiny pension contributions (there is one month in 2016 that has 130,000 businesses staging dates), the system will possibly go into meltdown with the huge administrative burden, so who knows what kind of return on investment this pension will give but it’s free to the employer and there to help you be compliant.  They charge the employee 1.8% of contributions paid in.

You can check out the website for further details

The way forward                                                                                                                              In the first instance you need to know your staging date and nominate a contact person for all correspondence to be sent to.  Do this at .  If you have a director only payroll, apply for the exemption.  If you need to comply, a pension scheme needs to be set up.  For clients whose payroll I run, I will be contacting you individually to discuss how to proceed.  For those who run their payroll through a payroll bureau, you will need to contact them to make sure they have an action plan for you to meet the deadlines.  For those who run their payroll themselves please contact me to discuss how to proceed.

I also have a contact who can set up, educate and make you fully compliant for £295+vat.  This does not include the ongoing processing of payroll and Auto Enrolment.  All costs will increase the nearer ‘crunch time’ approaches as all companies dealing with this are expected to become over subscribed.

Ongoing this does add a significant administrative burden to the payroll and all payroll costs will increase.  I would advise anyone with employees on weekly pay to transfer them to monthly pay before your staging date as dealing with this 52 times per year is a lot of extra work.  There is a lot of correspondence required between the employer, the pension provider and the employee. Failure to provide the required correspondence can mean non compliance fines will apply.  Payroll software which is AE compliant is essential but at the moment free packages such HMRC Basic Tools are not compliant.  Some packages such as Moneysoft are compliant to process the numbers but do not automatically run and submit the correspondence required.   Brightpay is fully compliant as is Sage but the AE bolt on can be expensive.

Failure to comply                                                                                                                    Current fines are £400 then £50 per day.

I hope this has cleared up some of the queries and no doubt thrown up some more.

All figures are based on the current 2014/15 rates.


Autumn Statement 2014 Review

So you would all have seen some sort of media coverage of the Chancellors Autumn Statement but most of what is in the press is just the headline grabbing key items.  In fact as usual there was a vast array of tax areas covered.  A lot, in fact most, of the changes do not affect the majority of people hence you won’t have seen them mentioned in the press.

Here’s my review of the main topics that will cover most of you and the topics that will cover at least one of my clients but there was much more.

If there are any areas that anyone wants me to elaborate on please email me directly.

Income Tax        

The Personal Allowance for 2015/16 will increase to £10,600.

As this exceeds the age allowance this will apply to everyone born after 6 April 1938.

The Personal Allowance for those born before 6 April 1938 will be £10,660.  As this is only £60 more than the standard personal allowance, those whose income exceeds £27,700 will only lose £60 from the age allowance write down.

20% rate band increases to £31,785 meaning the 40% rate band starts at earnings from £42,385, a much needed increase.  Threshold for the 45% rate band remains at £150,000.

National Insurance

No rate changes for Class 1 & Class 4 but the upper earnings limit has been bought into line with the 40% income tax threshold of £42,385.

The rates for Class 2 & Class 3 will be increased.

Class 2 will be bought into the self assessment tax system and be paid with your tax bill from 2015/16 so no more monthly or quarterly direct debits for the self employed.

Employers will not have to pay secondary Class 1 NIC on the pay of employees under the age of 21 years unless they earn over £815 per week.  This is extended to apprentices under 25 years old.

Extension to the £2000 employment allowance which reduces employers secondary Class 1 contributions.  This will now also include domestic care and support workers.


Abolition of the 55% charge on death.

  • When an individual dies before age 75, the pension fund may pass tax free to the nominated beneficiary.
  • When an individual dies over the age of 75, the pension fund, when withdrawn, will be taxed at the beneficiary’s marginal rate of income tax or 45% if taken as a lump sum.

This is extended to Annuities as well.

Overseas Matters

The proposal to restrict the personal allowance to non residents has been delayed until at least 2017.

Non-domiciliary  Remittance Basis Charge (RBC)

Resident in the UK but not domiciled here for:

  •    7 out of last 9 years – charge £30,000 per yr unchanged
  •  12 out of last 14 years –charge now £60,000 per yr
  •  17 out of last 20 years – charge now £90,000 per yr

Property Owners

Stamp Duty Land Tax on residential property has been reformed.  Before if you were buying a property which falls into the 3% bracket you would have to pay 3% on the whole value, now you just pay the appropriate % on the value over each threshold.  Rates as follows:

  • Upto £125,000                                 0%
  • £125,001 to £250,000                      2%
  • £250,001 to £925,000                      5%
  • £925,001 to £1.5m                         10%
  • £1.5m +                                          12%

Annual tax on enveloped dwellings (ATED)

Came into effect in 2013 and has raised 5 times more revenue than the government expected.

Applies to properties owned by ‘non-natural persons’ ie companies.  These businesses are structured in a way to avoid paying Stamp Duty on purchased and/or Capital Gains Tax on sale.  The ATED charge fills this gap.  Rates as follows:

  • Properties worth £2m to £5m       – charge £23,350
  • Properties worth £5m to £10m     – charge £54,450
  • Properties worth £10m to £20m   – charge £109,050
  • Properties worth £20m+                – charge £218,200

Business Owners

Intangible assets transferred on incorporation.  2 measures bought in to reduce the amount of tax relief available on incorporation of a business.

  • Entrepreneur’s relief will not be available on the disposal of goodwill where an individual or partnership incorporates their trade.
  • Corporation Tax relief is restricted on internally generated goodwill and customer-related intangible assets acquired from a related party on incorporation.


Simplification of expenses and benefits system.

Business Rates

The current doubling of Small Business Rate Relief will continue as will the 2% cap on the multiplier.

Shops, pubs, cafes & restaurants with a rateable value of less than £50,000 will see their current £1000 discount rise to £1500 pa.

Corporation Tax

The main rate will be bought into line with the small profits rate – both will be 20% from 2015/16.

Capital Gains Tax

Threshold increases to £11,100 for 2015/16

Inheritance Tax

No changes, it’s expected the current nil rate band will stay frozen until at least 2018/19.


The annual savings allowance will increase to £15,240, currently £15,000.

ISAs are currently exempt from inheritance tax if passing to a surviving spouse but are taxable in the hands of the spouse.  Now the spouse will receive a tax free allowance to cover the ISA amount so no income or capital gains tax will be payable.

Travel Expenses for Local Authority Councillors

Mileage allowance will now be capped at the Approved Mileage Allowance Payment rates.

Peer to Peer Lending

Growing in popularity due to various new websites

New relief to offset losses from bad debts against other P2P profits.


Numerous other areas which have had some reform, if you want to know more please contact me.

  • Non tax-advantaged share schemes
  • Anti-Avoidance, Fee income on fund managers
  • Special Purpose Share Schemes
  • Miscellaneous Loss Relief
  • General anti-abuse rule (GAAR)
  • Serial tax avoiders
  • Offshore tax penalties – now 200%
  • Disclosure of tax avoidance schemes (DOTAS)
  • Venture Capital schemes
  • High risk promoters
  • HMRC direct recovery of debts and the power to close aspects of an enquiry.
  • Research and Development relief schemes


VAT on Prompt Payment Discounts – you normally calculate vat assuming customer will take the prompt payment discount.  Now you will have to account for vat on the amount actually paid so will have to re-invoice for the extra vat if discount wasn’t taken.

VAT refunds for search & rescue and air ambulance charities, hospices, various government departments and the Highways Agency which will shortly be replaced by a government owned company.

Air Passenger Duty exemption for under 12 year olds, extending to 16 year olds in 2016.

Fuel duty of 7.9p per litre put on Aqua Methanol.


Data from Tolley via Association of Accounting Technicians

Picture courtesy of Unsplash



As more and more aspects of our lives are going online our internet security is becoming increasingly important. It’s no longer ok to have the word ‘Password’ for a password or to have the same password for everything, so what are we to do?

Firstly, what not to do

We post so much personal information online via Social Media or have information about ourselves held by others, some publicly available on mediums such as the electoral role that using any word or name that is related to you such as your son, daughter or even pets names are easy pickings for hackers, even if you add a number to the end.

Never use the word ‘Password’ or simple combinations like ‘qwerty123’ or ‘abcd123’. The shorter the password, the easier it is to crack. The average home PC is capable of being programmed to crack a 6 character password in a under an hour, 8 characters would take 24 hours, 10 is apparently about a month.

You need to come up with strong passwords

What is a Strong Password – A strong password contains at least 8 characters and should contain both UPPER and lower case letters and numbers.

A Superstrong Password is as above but with at least 10 characters and could also include special characters such as ‘!*&{@’ but not all systems allow these.

Here are some tips for coming up with a secure password which is still memorable.

Think of 2 or more words, convert the first word to all lower case and the second to Uppercase or vice versa. Then convert certain letters to numbers for example:

  • I or i becomes 1
  • E becomes 3
  • g becomes 9
  • o or O becomes 0
  • B becomes 8
  • S becomes 5
  • and becomes &
  • at or a becomes @

Examples in use:

  • Happy Chappie    –           h@ppyCH@PP13
  • Foolish Password –          f001!5Hp@55WORD
  • Off Down The Pub –        0ffD0wnTH3pu8
  • Strong and Secure –        5tr0n9&53CUR3

This works best if you choose words that have meaning to you.

Try not to re-use passwords – its ok to do this on unimportant sites such as forums but not for online shopping or banking.

Final Point

It is vitally important that you NEVER EVER use your email account password anywhere other than on your email account. Alot of sites automatically use your email address as your username. If you then use the same password as you do for your email and that site is hacked, the first thing a hacker will do is hack into your email account and then try all the other sites you use with that email address and the first site they will try is your Paypal and other bank accounts where they can get something out of you.

Stay safe.

Acknowledgements and credit for content to S Watts of Siwis Ltd


All About Poole

I recently saw a blog from a follower giving 40 reasons to move to Toronto, so I thought I would take inspiration from this and compile a list of things about Poole. Now Poole is a lot smaller than Toronto and our Mayor is not known internationally for taking crack and using inappropriate language, in fact, I have no idea who our Mayor is but let’s see what we can come up with.

    • We have one of the largest natural harbours in the world.
    • We have Blue Flag beaches

      • A Chain Ferry
      • Not one but two lifting bridges.
      • 4 Tides per day
      • It’s where the Scouts were founded by Lord Baden Powell – dib dib dib
      • The home of Sunseeker Yachts

      • The home of Lush – they make our industrial estates smell lovely

        • Head Quarters for the RNLI – they have a fancy new college building where you can even get married.

          • The Sandbanks Pennisular has the 4th highest land value in the world – you need serious millions for even a scrap of land.
          • Poole Quay – where several of the pubs date back to the 1600’s
          • The Dolphin Shopping Centre – an incredibly ugly 1960s concrete monstrosity, how did they ever think that looked good.
          • We have cross channel ferries.
          • Rainfall is well below the UK average.
          • Population (at the last census in 2011) is 147,600 with 22% under 19 and 20.5% over 65.
          • In 2006 a National Housing Federation study claimed Poole was the most unaffordable town to live in, in the UK.
          • The castle on Brownsea Island was originally a fortification built by Henry VIII in 1549 – now its owned by the National Trust who lease it to John Lewis for their staff holidays.

            • Ryvitas are made here – you can smell it when they burn them.
            • The heathland at Canford Heath is an 850 acre site of special scientific interest.
            • We have ‘Bikers Night’ on Poole Quay every Tuesday.
            • Polo on the beach.

            • It’s home to Diane Hudson Accountancy Ltd.


sandbanks aerial-1

Funny Tax Laws from around the world

A collection of amusing tax laws, past and present.

Peter the Great introduced a beard tax. Any Russian wanting to remain beardy had to pay an annual amount and was issued with a beard token which he had to carry with him in public to prove he had paid.

Roman Emperor Nero introduced a tax on the collection of urine. Back then it was used to prepare animal skins – and you thought today’s taxman was taking the piss!

In Canada children’s breakfast cereal is tax exempt if it includes a free toy. The free toy must not be beer, liquor or wine – yes, they actually thought they needed to clarify that, imagine Coco Pops with a free beer toy!!

In Sweden there is a tax for naming your baby something that is not already in use. It is also applied to the misspelling of names and names like ‘Apple’ regardless of income, status and tax bracket.

Scaredy-cat tax was introduced by Henry I for English knights that didn’t want to go to war. It was originally very low and meant as a deterrent but King John later raised it by 300% and even collected it when not at war. This led to the formation of the Magna Carter.

In 1988 a stripper in the US called ‘Chesty Love’ successfully claimed her boob job as a business expense. This paved the way for anyone in the adult entertainment industry to claim cosmetic surgery expenses if it would lead to more work.

In UK tax law biscuits and cakes are deemed necessities and are exempt VAT but cover biscuits jaffacakein chocolate and they are luxuries that have 20% vat added to them. So Jaffa Cakes – are they biscuits or cakes? McVities invented them and they make biscuits so they were forced to go a tribunal and prove they are cakes – they won so they are non vatable chocolate covered cakes.

In the Netherlands tax deductions are allowed on training in magic and witchcraft after an actress claimed £1500 tax relief for a year long course in potion making, spell casting & crystal ball reading.

Cow Flatulence Tax – This is a new tax being introduced in EU countries. Cow farts cause 18% of global warming. Large clouds of methane hang in the air over slaughter houses where they store thousands of cows causing negative effects on air quality. Ireland tax $18 per cow while Denmark charges $110.

Reba – The Face Behind the Noise

A few of you have met her but a lot of you have just heard her. I’m talking about our big fluffy monster who barks like crazy every time you come to my front door. We are trying to stop this behaviour but she is just so protective of her space.

I usually try to shut her in the kitchen before I answer the door as once the door is open she changes from being protective to very excitable and I know being jumped at, licked and covered in fur isn’t to everybody’s liking.

Her name is Reba (named after a bicycle suspension fork).

She’s a proper Welsh Border Collie from a sheep farm in the Brecon Beacons, she’s now 10 years old and we’ve had her from a puppy.


She loves to come with us for forest bike rides, she runs along beside us and gets impatient when we stop for a rest.

She also likes sticks

And her teddy’s

And we love her to bits




DSCF0117 (2)