Minerva Accountants Bristol and Somerset
Fully digital Xero accountants for consultants & service businesses
Instead, as an employee of a limited company, you can claim mileage of 45p per mile which covers not just fuel but the annual costs and wear and tear.
In order to do this you need to document your business mileage. Date, start and finish point, and business reason for the journey eg customer name, supplier name, or perhaps a course you attended.
Times are tough at the moment and small business owners don’t know where to turn. Those who are fortunate to have an accountant who already provides business advice have a headstart on their competitors. The real value of a good accountant goes far beyond ticking boxes, filling in forms, and meeting deadlines. This is the basic service that we offer our ‘Essentials’ clients in return for a ‘no frills’ fee.
Business is advice is more than just tax advice! Business advice is about improving profitability, growth, and work-life balance. More and more of our clients are asking us for additional advice sessions throughout the year.
It’s not just about preparing management accounts that nobody bothers to look at but about sharing ways that will improve the business. An accountant can explain what the numbers mean, highlight trends, and identify issues early. I’m not just an accountant and an entrepreneur myself but am also a qualified Coach and Mentor so at Minerva Accountants, we are able to provide so much more than just financial advice.
Business advisers can play a vital role in strategic planning and decisions such as pricing, hiring staff, investing in equipment, raising finance, expanding into new markets or just growing your share of your current market. And they have an open book of contacts when it’s time to call in experts.
Why wouldn’t any small business take advantage of business advice from their accountant when times are tough? And why aren’t more accountants able to offer this advice?
In short, business advice from accountants is not a luxury for small businesses, it’s a strategic asset. By working with an accountant who focuses on understanding the bigger picture, small business owners gain clarity, control and confidence. Compliance keeps a business legal, but advice helps it to grow, even through tough times.
If you’re looking for support in this area, we have a few options for you:
👉 Business Advice & Part-time FD Services
I’m sure that I’m not alone in enjoying winning new business. But referrals are my favourite source of new clients.
So how can we receive more?
Here’s to many more happy clients
Don’t forget to claim the VAT on business mileage.
You can’t claim VAT on the full 45p but you can claim on the fuel element. You can find out the current fuel element Advisory fuel rates – GOV.UK (www.gov.uk)
For instance, if my car has a fuel rate of 14p. This means that, for every mile, I can claim 14p *20/120 = 2.33p in VAT. There is no VAT on the remaining 31p as that is deemed to be for insurance, maintenance, wear and tear etc.
fuel around the date of the journey ie when you you fill up before or after the trip.
*If you’re interested then it’s because the 45p is an allowance and EU/UK law states that you can’t claim VAT on allowances. The EU did one of their usual accommodating moves and agreed that, as long as there was a valid VAT invoice for fuel around the same date (eg filling up before or after the mileage) then the company could claim VAT on the fuel element of the 45p.
All you need to do is to keep a VAT invoice* (not a credit card receipt please!) for filling up just before or after your trip
Stage 1: Owneroperator. On starting up it’s just you and you may choose to bootstrap and spend your time instead of your cash so that you end up working long days. Everything is new and it takes a while to refine your systems so that you’re con constantly reinventing the wheel. You need to pay for expertise that you don’t already have or undergo training. And what happens if you go off sick or want to take a holiday?
Stage 2: Small team with bottlenecks. Now you have people in board to take care of most of the day to day stuff but anything new still involves you in making a decision, buying software, or recruiting. As a chartered accountant I review ALL the accounts that I sign off. Now the fear isn’t your own absence but recruiting and retaining the right people. Your team get paid first and you get what’s left over. If there is anything left over.
Stage 3: Managerled business. Now the day to day has moved away from you and so have many of the decisions and processes. You are removed from the business and managing remotely by the numbers. You dream (or have nightmares) about your KPIs (Key Performance Indicators)
There are different financial challenges at each stage and, as accountants, we are used to helping are clients at all stages. But finance isn’t the only challenge and our coaching sessions help clients to move smoothly, or as smoothly as possible, from one stage to the next. This is that value of an accountant who is also a business coach.
The rules are different for sole traders and for companies.
Generally sole traders can NOT claim for eating out. Eating is not ‘wholly, exclusively and necessarily for the purposes of business’ because it fulfils the dual purpose of keeping you alive!
Employees of limited companies can claim if the meal is wholly and exclusively for business purposes. If business reasons require them to be away from home/office around meal times (so that they are unable to make their usual arrangements) then it is a reasonable business expense.
The amount they can claim for a meal will be agreed with their employer but should not be overly lavish and I would suggest limiting alcohol to one drink with the meal.
Entertaining is generally not allowed (see other Tax Tips on staff entertaining) for tax or VAT purposes.
What a week it’s been with confidentiality issues at Companies House following on from weeks of confirmation statement failures back in November and problems with accepting personal ID numbers for directors.
We try to stay on top of all these deadlines with reminders to clients on top of all those from Companies House themselves but it’s not easy and, whilst we haven’t let down any clients yet, I have encountered problems with my own companies. Yes, as an entrepreneur as well as an accountant I run two other businesses alongside Minerva Accountants.
Having requested that all directors verified their personal ID by 18 November last year we’re still chasing in some clients in order to submit their confirmation statements. Even where we don’t submit confirmation statements we will soon need these in order to submit accounts.
The latest round of personal ID verifications is for PSCs (Person with Significant Control) but, for some unknown reason, it was not possible to add these to the confirmation statements that we have already submitted. Instead there is a 2 week window for each company at some seemingly random time of year.
And this is what has caught me out.
On 10 March I received an email reminder to ID myself as a PSC on one of my companies. Great, I’m all ready to enter my number BUT my window isn’t until April so it’s going to sit in my inbox until then. I’m pretty sure that half our clients will lose this email when their window comes. Good thing they’ve got Minerva Accountants looking after them!
Yesterday I received a letter for another of my companies forwarded from my old home address saying that I had missed the window to ID myself as a PSC. No idea what happened to the original letter/email and why they sent it to that address when I carefully updated everything at Companies House at the time and have even submitted a confirmation statement. The letter was fierce but toothless and just gave me an extension so no real problem but something clearly isn’t working.
Basically, if the system isn’t easy for somebody like me who is used to compliance, then small business owners don’t have a hope!
The best time to prepare for a stress-free year end is nearly a year ago. Trite but true.
But we are where we are so what can you do now?
Doing this early, and regularly, will help to make the year end easier.
While you’re at it why not consider regular management accounts to provide a true financial position BEFORE directors draw money out of the business? It would save the company so much money on overdrawn DLAs leading to S455 penalty tax and tax/NI on P11D beneficial loans.
Lack of cashflow is the number one cause of failure in small businesses. Even profitable businesses still run out of cash. This can because they’re not forecasting their cashflow requirements properly as they grow (See our webinar on How to Scale Without Cashflow Chaos https://youtu.be/hmPssYUINWY?si=8nRJW-KGaAQfZRQy )
But sometimes businesses are busy tracking the wrong thing. Your profit and loss is only one of the reports that you should be looking at regularly. This doe not show:
Ideally you should have a proper cashflow forecast and there is software that will connect to Xero (and other software) to help you to do this for yourself, or with our help.
There are so many ways to grow your business that it can feel like a nightmare knowing what to do first so here are the three most effective levers to pull to instantly improve your profitability.
1.Pricing
Most businesses are under-priced and it just becomes a race to the bottom as there is ALWAYS somebody who will do it cheaper. Many accountancy firms are as much as 20-40% under-priced.
This mini-course explains how to go about it and why you shouldn’t worry too much about losing your less profitable clients.
2.Productivity
Getting things right first time reduces rework, structuring your time to minimise interruptions, and minimising or eliminating other inefficiencies will improve your productivity,
3.Positioning
Establish yourself as an expert or quality service and you will attract clients who value that expertise. This is a case of BEING better and also SHOWING yourself off better.
Small tweaks can be more effective when time and other resources are limited.
And, as usual, we have a resource that can help you so just email us if you would like a copy of our 30 day Profitability Boost Checklist (free) or to subscribe to our 30 day online course and group to ensure that you actually get it done (£199). hello@minervaaccountants.co.uk
For businesses with 5-249 employees and where activity and outcomes are delivered within a 50 mile range of UWE Bristol. Find out more here.