Deadlines, deadlines, deadlines! There is nothing like a good deadline to get you motivated, especially when it comes to that glorious time of year when taxes are due. Still, as we all get busy with our daily lives and other obligations, that 31 January deadline can creep up on us and leave us scrambling to complete them on time.
By mid-January an astonishing half a million people will not have filed their taxes with just two weeks left to do so. The result: many late filings and post-deadline tax returns. So, what can you expect if your tax return does not get there in time?
Okay, chances are if you file your tax return after the deadline your life will not be over with. There will be no execution mob that comes after you, but there may be something much worse – the government.
The government has not, in recent decades especially, taken lightly to the idea of missed or late tax returns. In 1992, it began to reassess the laws and provide individuals and businesses with stiffer penalties for not paying their taxes on time.
The penalties for filing your tax return late can be high. Firstly, there is an initial penalty of £100. You will then be charged £10 a day for the first three months up to the date that you submit your return, up to a maximum of £900. So, for example, if you file your tax return on the 12 February, you will incur a fine of £220 (a £100 initial penalty plus £120 for the 12 days you were late). If six months pass and you still haven’t got around to filing, you will either be fined 5% of the tax due or receive an extra £300 fine. And if a whole year goes by you will receive the same fine again. You may also be asked to pay your tax bill in full on top of all of the fines outlines above – which is something that no business wants to end up having to face.
With so many complications and filing issues, it would be better to avoid the late penalties and get on track with filing your return on time. Easier said the done! Rather than trying to take on the task all on your own, consider using the resources around you. Specifically, those in the financial fields well versed in the laws can help. Accountants are individuals who understand taxes and will be able to help you reach your end goal of filing more easily. Consider them as a great resource to avoid the penalties that late filing face.
Laura Ginn writes for www.realbusinessrescue.co.uk, a website that offers help to businesses that are in trouble.
For tips and practical advice on filing tax returns see the Tax Donut's latest blog.
Business owners take note. The self assessment deadline is fast approaching and if you haven’t filed by midnight on 31 January expect hefty fines from HMRC. Although many can take it in their stride, for the uninitiated, completing a self assessment can be a daunting affair – especially if you don’t have a head for figures.
Do a bit of research and approach your personal tax return sensibly, though (and, of course, follow our simple tips below), and you’ll have it filed in no time.
Give yourself time!
Your self assessment isn’t something you can just sit down and do in one evening. If it’s your first time, you’ll have to wait for two separate pieces of information to arrive in the post from HMRC (your Unique Taxpayer Reference number, used to identify you, and your HMRC Online Services PIN number, which gives you access to the online filing system).
Not only that, but you’ll need your previous financial years’ bank and credit card statements. Banks often make procuring these records needlessly complicated, so plan in advance to make sure you have everything you need.
A large part of filing a self assessment is just that – filing. You need to organise all your financial records sensibly, ready for entry into HMRC’s online filing system.
Categorise your records by income and expenses, and separate out revenue streams. For example, you may receive money directly through your business, but also own a rental property that nets you a few hundred quid every month. These need to be recorded separately.
Don’t rely on HMRC’s hotline
Although HMRC Online Services is full of helpful hints and tips, its self assessment hotline becomes virtually inaccessible for the last few days of January, as disorganised individuals rush to complete their tax return at the last minute.
You may be able to get through if you persist, but HMRC’s call centres shouldn’t be relied upon around personal tax season.
If in doubt – consult an expert
Those with more complicated finances may well be better off engaging an accountant to complete their self assessment. Many firms offer a one-off personal tax service for about £75, which can prove a real lifesaver if you get stuck.
Remember, you have to pay your tax on the 31 January, too
If you leave your filing to the last minute only to find out you owe HMRC thousands, that’s bad news for you and your bank balance. Filing early will allow you to find out how much tax you owe beforehand, so you can plan appropriately.
Self assessments aren’t always bad news, though. If you’ve overpaid your taxes in the last financial year you’ll be in line for a refund from HMRC and filing early means you’ll be at the head of the queue when the taxman’s purse open.
Negotiators tend to get stuck when it comes time to close a deal when they keep hearing "no". There are some simple tricks you can learn to help increase your closing rate. Here are three tips that will turn that "no" into a "yes".
Start with a Close, end with a Close
From the moment you meet your potential customer think about how you are going to close the deal. Always greet them with a smile and form a relationship. People will rarely sign a deal with someone they don't like or respect. Ask as many questions as possible about the problems they are having that your product or service may resolve. This is not when you start selling, it’s simply asking questions and listening to the answers. Gather as much information as possible so that during your presentation you can sell directly to the problems they’re experiencing.
Your presentation is where the selling takes place and it should be the only time you’re in sales mode. Your presentation should be a little different every time, since you want it to be tailored to each individual client's problems. During your presentation, point out every resolution to the problems they explained earlier. The presentation should be enthusiastic and hold their attention. If there is more than one person in the room, talk to everyone as a group.
Once the presentation is done, your selling is done. This is where you sit back as calmly as possible and listen to reactions. You should become very consultative when answering any additional questions or concerns at this time.
The Mini Pre-Close
During your presentation, as you’re selling to the customer’s concerns, squeeze in as many mini pre-closes as possible. The more times they say yes to a small question the more likely they will say yes to the big question. This puts them in a habit of saying "yes" instead of that dreaded "no". The best way to do this is after you make a point about one of the problems that your product or service can resolve simply ask, "This solves your problem, right?" As you ask this question nod your head and chances are they will agree with you.
After completing your presentation repeat this process one more time before you sit back and listen to responses. Do this by simply asking all of the same questions again. This may seem repetitive, but this is just giving the customer time to realise how wonderful your product or service is.
Get them emotional
Once your presentation is complete and you’ve answered any additional questions or concerns now it is time to “ask” for the deal. This is the most common mistake ever made - people don't ask for the deal. Be assertive and ask as if you assume they will say "yes" (commonly known as an assumptive close).
You might have to do a little more work at this point. This is where you need to get them back into the emotional state of mind. People buy for emotional reasons, not logical reasons. Studies show that pictures help to put people into an emotional state. You can achieve this by drawing a simple picture, maybe a graph showing statistics or a picture of your product – it doesn't have to be fancy.
Another easy way to get someone in the emotional state of mind is to talk into their left ear. This triggers the right side of the brain, which is the emotional side. So be sure to be seated on the left hand side of the decision-maker in the room.
Supplied by negotiation experts The Gap Partnership US.
The idea of entrepreneurship and the real-life, day-to-day experiences of entrepreneurship are two vastly different things. In my first serious venture our team raised $250,000 for an online financial technology start up, which was focused on educating and assisting investors to develop asset-management strategies to self-manage their own capital in various financial markets.
Our business model was strong. The company had several key revenue streams and after nine months of pre-launch development and another nine months of post-launch operations, the company finally began to make money. Then, for an additional six months the company largely broke even. And, finally, after 24 months, the company began to make enough money to make the venture worthwhile.
Through the life of our company, our team learned many lessons, but one has stuck above most. A successful entrepreneur is characterised by many attributes, but ability to manage risk is key. Most people never even consider this aspect of business, but the ability to actively manage risk is often the difference between entrepreneurs who have a great idea and entrepreneurs who actually build successful companies.
The greatest risk
The single greatest risk for any entrepreneur is running out of cash. A business fails when it runs out of cash or available credit. If a business spends more than it makes per month, that burn rate will eventually cause the business to fail once all cash is spent and available credit is used up.
Therefore, every entrepreneur should be fixated on controlling costs and managing this risk. Let’s discuss a few key points that will empower aspiring entrepreneurs to successfully manage the risk of cash flow.
Cut out the non-necessities
When starting a business it can be tempting to spend money on non-essentials, such as nice office space, beautiful office furniture, expensive computers, administrative staff, etc. This is a black hole of lost cash, however. Until a business is generating healthy net-positive monthly returns, it is wisest to keep in “bootstrap mode”. The only money spent should be what is absolutely necessary to create the business’s product or service and take it to market. Bootstrap mode may not be the most fun experience, but it’s necessary and often means the difference between a business idea and an actual business.
Know your burn rate
A second temptation many entrepreneurs face is to ignore the numbers. “If I just keep my head down and keep moving forward, we’ll make it. The numbers are depressing, so I don’t need to look at them.” This is disastrous. As a business owner and leader, one should always have a direct pulse on the cash position of your business and how cash is flowing in and out of it. One of the most important numbers is the burn rate. This is the amount of money you are losing each month.
If you divide your cash reserves by the burn rate, you’ll get the maximum number of months the business can survive at its current trajectory. Know this figure at all times, and be proactive about cutting costs to extend the lifeline of the business.
Entrepreneurship is a great challenge. Put yourself in a position of power by taking a proactive stance toward active risk management and seek to manage your cash risk by consistently keeping expenses low during the early stages of your company’s growth.
This has been a guest post by Danielle Thomas from Merchantseek.com.
The business plan is going well, your idea seems to have feet but you face a major problem. You need money to get your new business off the ground.
Securing funding is one of the most common start-up problems. There are various ways to raise finance, which is a good thing, but many people are unaware of all of the options available to them or are unsure about how they work. Do your research to find out how you can raise the funds you need in a way that best suits your business. Here are the pros and cons of some key start-up funding options.
Banks and building societies
Venture capital trusts
Crowd funding and peer-to-peer lending
By Erin Walls of Ward Williams Chartered Accountants
Part of the job of running your own business is figuring out how you can get ahead of the game. You need to have processes or systems that can focus on you finding cuter/smarter/cleverer ways of doing things. You must find ways that are cuter/smarter/cleverer than the way your competitors do things.
I will suggest two options:
1 The ‘Think On’ Hour
Most business owners arrive at work before the rest of the team. The place is quiet and there are far fewer interruptions. I know of some business people who take this time every day and spend up to one hour simply sitting and thinking about how to improve things. After all, if we agree that we need to spend more time working on the business and less time working in the business, this is a blindingly obvious thing to do – even if you only do it once a week!
2 The ‘KPI Focus’ Hour
A more focused and less freeform approach may produce even better dividends. We all have basic key metrics we use to measure and evaluate business performance – key performance indicators. If you don’t know what I am talking about you can stop reading now and just go for the ‘Think On’ Hour option.
Use your KPIs (or metrics or whatever you wish to call them) to evaluate performance. Once a week spend an hour (alone or with the team, whatever works best for your business) and focus on the one key issue you need to improve in your business. This can be called your single, most-important, over-arching goal for the coming month.
Decide what the over-arching goal is going to be then brainstorm, Google, steal, talk and debate about how you are going to improve your performance. Decide what you are going to do. Make it a high priority. Commit to it. Communicate it. And do it.
Robert Craven shows MDs and owners how to grow their profits. He is a keynote speaker and author of business bestseller Kick-Start Your Business (foreword by Sir Richard Branson). His latest book – Grow Your Service Firm – is out now. He also runs The Directors’ Centre, helping growing businesses to grow. For further information contact Robert Craven on 01225 851044 or email@example.com
Starting an online business is not an easy undertaking, there are many considerations to take into account before you even get your new business off the ground. Often new businesses fail because they don’t plan adequately or neglect to consider the magnitude of the task ahead of them. Here are my top 10 tips for starting a successful online business.
If you are a home-based start up looking to move into your first commercial property, renting a desk in a shared office can be a great workspace solution.
The amount of spare desks available for rental has been steadily growing over recent years and they are an increasingly popular office option. These are just some of the ways that life in a shared office could bring the best out of your enterprise.
More flexible contract
Shared office space is often available immediately and there is little of the potentially complicated legal process inherent when taking out a traditional office lease. This means you can get in straight away and start enjoying life in a buzzing office environment.
Furthermore, contracts are often rolling month-to-month affairs and this is where a shared office could really help you bring the most out of your business’ potential. If you feel the need to move or expand to meet the requirements of a fast-moving market, you are not tied to a location long-term. This could allow you to move wherever the market takes you.
Enjoy the buzz of office life
Another good reason to consider life in a shared office is you can make brilliant business contacts and fantastic friends. You may also find that being in an energising workplace can motivate you to work better. You might even have the skills your hosts require and working for them could provide a welcome additional revenue stream.
Increase your focus
If you find that the buzz of an office is a little too “buzzy”, the great advantage of flexible contracts is you can find yourself another, quieter workplace where you can better concentrate on driving your business forwards.
This is an important factor in your office search, because one of the great benefits of escaping the many potential distractions of the home-working environment by renting a desk is that it could do wonders for your focus. You can enjoy the many potential advantages of having a clear definition between work and home and even your commute could become a valuable time when you can get in the right mindset for work.
Additionally, in a shared office the services you access, such as broadband and security, are often included in one monthly fee. You can enjoy the many benefits of office life without having to spend valuable time managing the things that are often necessary when renting workspace in the traditional way.
This makes shared offices a great option at a time when you need to focus all your energy on your new business and really work towards bringing the most out of its potential.
Hang on a second
Shared offices are often great workplace solutions, but of course there are downsides. You will probably have very little control, both over your office environment and your workmates. So, if you like to use specific services, particularly for things like security, then a shared office may not be for you. However the beauty of such flexible contracts is that they still could be worth trying out.
Peter Ames writes on behalf of Office Genie, marketplace for office and desk space.
Recruiting is fraught with problems, not least the sleepless nights that come when you know you’re responsible for someone else’s mortgage.
What should you do when your workload means you have to take on staff? I’m no expert, but here are a few tips I’ve picked from our own experience over the years.
Temp to perm
Forecasting at the start-up stage is hard. Yes, you’ve won a contract that requires extra staff for five months – but can you guarantee the work after that?
Plus, there’s nothing worse than employing the wrong person and having to spend time and money correcting the decision through training, HR or expensive calls to lawyers.
Temp-to-perm is a great solution and one we adopt in our warehouse. Firstly, it provides a means for both parties to test each other out. Secondly, employees prefer the transparency of this contract above the much-abused probationary period. Thirdly, for those eager for a job, it’s a chance to prove their worth, driven by the end goal of a full-time position.
Start them young, train them up
You can create loyalty by investing in someone with potential, filling them with the encouragement, skills and confidence to act as your right arm. By dedicating time to teach an employee from scratch, before they’re influenced by bad habits from other companies, they have – in turn – benefited from quick promotion, yearly pay increases as a reflection of their capability and knowledge of exactly how you like something done. Be careful, though, that you don't fall foul of age discrimination laws in your enthusiasm to give an inexperienced employee the benefit of the doubt.
Recruitment takes time; time you don’t have if you’re in the fortunate position to recruit. We use agencies now for 80 per cent of our workforce positions. A good agency with a clear brief will know what you want and it will manage the preliminary selection so that you can concentrate on seeing a strong shortlist. The commission agencies take is usually more cost-efficient than your time spent searching.
Ian Cowley is managing director of cartridgesave.co.uk, the UK’s largest dedicated printer cartridge company.
Start-ups have it tough these days – there are so many companies in every single industry that it takes an incredible effort to find an edge that would allow a start-up to thrive or even operate in these conditions. However, there are some unique solutions to some of the obstacles that start-ups usually meet when they start out.
The truth of the matter is that almost every single business needs an office space to run properly. The thing is, it is hard to find a good balance between the costs and the actual benefits of a prestigious location. You will either have a great place in the city centre and run out of money, or you will find an abandoned building far away and nobody is ever going to notice that you even exist. How can one deal with that dilemma? One though-provoking idea has recently found a footing on the market – the idea of virtual offices.
The idea is stupidly simple – you can rent an ‘operating’ space somewhere away from the centre for a low price. From that place, you will simply run your small business without any distractions that the city centre often brings. And, additionally, you will rent a virtual office in a prestigious spot. There won't be any physical space for you, but your business will get plenty of prestige from being located on a good address.
That alone would hardly be worth it, but think about the fact that you can use that address for all kinds of things – correspondence, order taking, advertisements, etc - the possibilities are unlimited.
Sometimes, your provider might actually own some physical space in the given location and will often be able to provide you access to that in case you would like to set-up a business meeting without having to force your customers out of the city. Intriguing ideas all around – and perhaps you will be able to think about some more as well!
Lewis Edward is a co-founder of The Office Providers, a company that deals with all kinds of office space.