- Experience – unlike a coach they can offer real world advice as they’ve been where you are before and survived
- Some mentors, like me, are also qualified coaches so they can help you do what’s right for your business rather than just share their own stories. This gives you the best of both worlds.
- They speak the same language
- They will always be in your corner to support you
- They can offer friendly critique of your ideas
- They may have a black book of useful connections for you
- They can act like a NED for an individual business owner
- You can bounce ideas off them before you implement
- You are allowed to disagree as your business is not the same as their business
- As somebody on the outside of the business looking in, they may have a better view from the bridge while you may be busy in the engine room of your business
Working from home allowance
It’s often overlooked but, if you work from home because you don’t have other premises then you can claim an allowance for this. Even just using a corner of your kitchen table to do raise your invoices each week and check your bank (I hope you do this at least weekly!) means that you can claim £6pw.
For sole traders the amount goes up depending on the average number of hours you do each week.
Directors of a limited company can rent an office to their business. We recommend that they only do this for 5 days a week to avoid paying capital gains tax when they sell their home. The amount of rent can be set at the same level as the costs (we have a spreadsheet to help calculate this each year) so that there is no personal income tax to pay (although it should go on your tax return).
KPIs for a better work-life balance
You probably know by now that, in order to focus on getting something done then you need to start measuring it.
I love what I do and we only have good clients so it’s too easy to work when I should be doing other things. Like relaxing. Two KPIs that I use to ensure that I maintain a decent balance are total hours worked and profit per hour.
The first one is fairly clear. I ran my first accountancy practice on 25 hours a week (the length of a school week) to fit around my 2 small children. I do work longer hours now they’ve grown and flown but I still want time for me.
By measuring profit per hour I have a clear benchmark when deciding whether to do something myself, to automate it, or delegate it. Whilst somebody else might take the same time as me they may be cheaper or, they might do something faster because they are an expert more familiar with the task. Software may cost money but it can save time which is why we invest quite a bit in order to run a lean business.
Taking yourself out of the day to day of the business will also increase the value if you are considering a business sale at some point in the future. A business that operates independently of you will give you a better balance AND allow you to scale AND increase the value when you finally exit.
Child benefit while abroad.
I have a few friends and clients who are travelling with young children; either homeschooling or before they start school. If you are out of the country for 8 weeks you will need to reapply for Child Benefit (we used to have reciprocal arrangements with EU).
Recently HMRC have been automatically stopping payments after just a month so something to be aware of.
“Your success in life depends on your ability to speak, your ability to write, and the quality of your ideas, in that order” Sir Patrick Winston
Professor Winston is a computer scientist and director of the MIT Artificial Intelligence Laboratory 1972-1997. Somebody renowned for the quality of his ideas, and yet he promotes communication over this.
And I have to say that I agree. We need good communication, whether on a stage or in a book, to demonstrate what we know. It isn’t much good if we can’t share our ideas in a way that others can understand and act on.
I’ve worked in companies, and with accountants who appeared to believe that ‘knowledge is power’ and kept everything to themselves. But that only gives power to one person. Let’s find ways to share our good ideas with those who need it. Not regurgitating unsolicited advice for our own ego but because we are genuinely able to help.
If you’d like to learn to speak then I recommend Toastmasters or I know several good speaking coaches such as Scott Johnston.
If you’re already comfortable and speaking regularly and want to do this professionally then I recommend joining the Professional Speaking Association
Writing is harder but AI can help to improve your writing.
- Draft it
- Pop it into AI along with the tone of voice, intended audience, and purpose eg please (I always say please because, who knows, it might make a difference when machine rules the world 😉) rewrite this draft in the tone of voice of Della Hudson FCA for an audience of accountants/business owners wanting to grow their business.
- Re-edit it back into something a little more human and in line with something that you might actually say.
Have fun experimenting with the right AI prompts for you.
Changes to furnished holiday lets
The special tax regime for furnished holiday lets is being removed so, in future, they will be treated as any property income:
- Mortgage relief will be capped at 20%
- Capital allowances will no longer be available for purchase of new furniture and fixtures. Only replacement relief
- Business Asset Disposal Relief will no longer be available and no rollover relief for reinvested capital gains
- Profits will no longer count as relevant earnings for pension tax relief
- Income must be 50:50 UNLESS a Form 17 has been submitted beforehand showing unequal ownership.
Les bons comptes font les bons amis
It’s a French saying that means that keeping good accounts makes for good friendships.
Usually this means that debts should be settled promptly. I’ve written before about how important this is in the business world whether you’re the one paying promptly or ensuring that your clients pay you on time.
But it could also be used to talk about the quality of your accounts and the importance of keeping them up to date. And this is why I’m (broadly) in favour of MTD (Making Tax Digital) which finally goes live in April with the requirement for maintaining digital records and making quarterly submissions to HMRC.
The benefits I see are:
- Up to date information for decision making, debt collection, and just knowing roughly how much tax is due, and how much the business owner can take for themselves. Anybody who has dealt with the extortionate rate of ‘penalty’ tax on overdrawn directors’ loan accounts will understand the importance of this.
- Faster year end accounts when seeking finance or renewing mortgages.
- Processing bills faster with the use of technology just by taking a photograph or forwarding an email. No more mourning over lost receipts, without which VAT can’t be claimed.
- Tools to store receipts electronically and saving the need to print out paper invoices which frees up space and is much better environmentally
- Faster cash collection with recurring invoices, prompt invoicing from a phone, connecting to direct debit software, or card reader apps on your phone.
And I believe, with such a tech savvy nation, this is the time for it. Most people have a smart phone on which to take photos of their children or their receipts to upload into bookkeeping software (the receipts, not the kids although we don’t mind seeing pics of the latter too) to be processed by the business owner or bookkeeper with the help of AI suggestions.
Up to date record keeping will allow accountants to provide much more proactive support to clients and, as somebody who likes to see my clients thriving, I’m looking forward to it. No more websites with the empty promise that ‘we’re PROACTIVE accountants’; it’s about to become reality.
Tax Tip
Do check if you’ve completed your personal tax return for 2024-25. Missing the deadline could cost you in penalties and late planning.
If you’re a client then please pull your finger out and get the information over to us asap.
If you’re not already a client and you need a hand then we even have a DIY Tax return webinar to guide you through it. The next one is 7pm on Wednesday 12 November so reply to this email if you’d like more information.
We’ve also got a webinar on what you need to do to prepare for MTD if you are a sole trader or landlord with income (not profit) about £20,000pa
Create without restraint
I saw this on a social media post yesterday and it got me really excited. (Okay, accountants clearly have a different tolerance for excitement compared to the rest of the world 😉) I love coming up with ideas to improve my own businesses and also clients’ businesses.
We even have quarterly meetings to discuss my ideas. Strictly they’re our 90-day planning meetings where the team get together, in person, if possible, to plan the next quarter.
Fortunately, I have a very pragmatic business manager (Kate) who restrains me and keeps me on track! Apparently, we don’t have time to do EVERYTHING I want to improve the businesses in the next 90-days, so we discuss everything and then prioritise.
Kate then creates an action plan and sends these out to each of us. And then she NAGS me to get these done. This accountability means that my ideas become reality instead of drifting away like dandelion seeds on a summer day.
We even package this as for our clients:
- Business coaching from me (I’m a qualified coach as well as an accountant) to help unblock your business
- 90-day planning sessions with Kate who also runs a VA business to get things done
- Clarity financial reviews to grow your business by numbers (and I’ll even throw in a copy of my Growing by Numbers book)
So, feel free to indulge me and my creativity by booking a group or individual coaching session this month.
Tax Tip – Not a tax tip this week but a source of free support.
The Cyber Resilience Centre for the South West has a Home Office funded course and other support for you to secure your business.