The season comes to an end…

Spring and snow arrived forcing the Coventry game to be postponed at the last minute to the end of April and an almost playoff decider – see later in the report.

Mansfield away followed and a last gasp Ollie Palmer equaliser would prove vital at the end of the season earned Lincoln a draw. Two 3-1 victories followed – away at Chesterfield, who are on the brink of relegation, and local rivals Grimsby in freezing blizzard like conditions.

0-0 away at Morecambe took us to Easter. Exeter on Good Friday – a really entertaining 3-2 win after coming back from behind and a tough 1-0 win at Carlisle on Easter Monday.

Sunday 8 May was the day fans had been waiting for, Lincoln City’s first trip to Wembley. Around 27,000 imps made the journey down to London in buses, trains, cars and with over 40 coaches travelling from the club. The atmosphere was electric, and the stadium was a sea of red and white with Lincoln outnumbering their Shrewsbury counterparts by at least two to one. Elliot Whitehouse scored the only goal of the game, putting Lincoln ahead in the first half and Ryan Allsop kept Lincoln ahead with a great save. A fully deserved 1-0 win meant Lincoln claimed the Checkatrade Trophy.

Following on from the excitement of Wembley came a disappointing 1-0 defeat at Port Vale and a frustrating 0-0 against former imp Gareth Ainsworths Wycombe set us up for a must win game v Colchester and with Michael Bostwick sent off it needed a last minute winner from Luke Waterfall to maintain the play off push.

Next came a brilliant 4-2 win at fellow play off chasers Coventry, backed by almost 3,500 fans meant a point was needed in the final two games, to ensure playoff position. A 1-0 defeat at champions Accrington left it to the final game at home to Yeovil. A crowd of over 10,000 saw Lincoln get the point required with a superb Tom Pett equalizer sending them to meet Exeter in the Playoffs. After the game the fans got to witness Neal Eardley and Michael Bostwick receive their well-earned player of the season awards.

The home leg was held on Saturday 12 May, live on Sky Sports in front of a vibrant atmosphere, the game finished 0-0. Matt Rhead hitting the bar was Lincoln’s best opportunity of the match. This result meant it was all to play for on Thursday night at Exeter. Unfortunately though it was not the Imps night. After having a goal controversially disallowed, Lincoln went down 3-1 resulting in losing out on the opportunity for a second trip to Wembley this season.  Another year in division 2 beckons.

For a 1st year back in the football league I don’t think many Lincoln fans could have hoped for more – losing in the playoffs and a historical victorious visit to Wembley. Alex Woodyard has already left but with a few new signings on the horizon a new season can only be viewed with immense optimism.

Onwards and upwards! #UTI


Holiday time – is your agent ATOL protected?

With the collapse of Monarch Airlines the risk of travelling with ATOL protection is very much at the forefront of everyone’s minds. But what does this in fact mean?

Anybody selling qualifying flights or holidays must be ATOL bonded to enable them to trade and sell such products. Annually the Civil Aviation Authority require such businesses to submit their renewal paperwork, and then 2 documents must be reviewed and approved by a qualified Reporting Accountant under the ATOL scheme.

What does this mean though? There are new financial tests in place that the business must pass to enable them to renew their licence. In many cases Directors and Shareholders are being asked to invest heavily into their company by way of cash injection, confirmation of them leaving funds within the business, or converting their loan accounts into share capital so as to tie it up in the company. This is causing some real headaches for the smaller operators.

The reporting accountant is responsible for ensuring that the systems operated by tour operators are robust enough to capture all the necessary bonded bookings and ensuring that they pay the correct levy over.  The ATOL levy of £2.50 per passenger is what has now enabled thousands of Monarch passengers to claim back their money directly from the Civil Aviation Authority.

The Authorities are relying on the registered accountants to provide them with the assurances as to the accuracy of these operators’ data.

Always be aware of whether your flight is ATOL bonded for your own protection in the event of airline failure. For more information on the scheme visit the CAA website

Nicholsons are registered with ATOL to undertake reporting accountant work. If you require advice around ATOL reporting please contact me on 01522 815100.

 


Invitation to the Lincolnshire Show

We invite you to join us at the Lincolnshire Show on Wednesday 20th and Thursday 21st June 2018. Our stand is ringside on Fifth Avenue.

Wednesday 20th June – Update from our Agriculture Team at 11am  

Our Agriculture Team invite you to join them for refreshments.  During this time they will give you a short update on tax and HR matters relevant to the agriculture sector.

Wednesday 20th June and Thursday 21st June

Come along and join us on either Wednesday afternoon or Thursday afternoon at our drinks reception at 2.30pm. Take the opportunity to relax after a full morning at the show. Our team will be on hand should you wish to discuss any accountancy matters with them.

Please RSVP by Friday 15th June to Linda.clark@nicholsonsca.co.uk stating which day you would like to attend.

Tickets cannot be provided


Tax implications – when moving properties from a partnership to a limited company!

From the 6th April the restriction in tax relief on mortgage interest for higher rate tax payers increases so buy to let owners will start to see the profitability of their properties start to decline. Essentially in the 2018-19 tax year 50% of mortgage interest will be allowed as it has previously been, but for the remaining 50% the relief will only be at the 20% basic rate of tax.

Since the changes were announced, landlords have been searching for solutions to ensure the profitability of their buy to lets with the hint of interest rate rises ahead.

One potential solution talked about is the possibility of forming a partnership with the properties and then incorporating the business to fall out of the tax relief restrictions, but this solution is only likely to be accepted in certain circumstances.

The reasoning behind this solution is that normally when you have been operating a business as a sole trader or partnership you are able to sell your trade into to a limited company. When you sell something personally, other than certain personal possessions it falls subject to capital gains tax, but if you do not receive proceeds for the sale, in that you exchange your business for shares in the company, the gain you would be taxed on is rolled into the shares and the tax would be paid on their eventual sale.

The key word is business and where properties are involved it can be more difficult to convince HMRC of this. To achieve the relief on putting properties into a company you in theory would need to demonstrate some history of trading as a business prior to incorporation and it would be likely that HMRC will expect to see the owners collecting the rents themselves and organising any repairs etc, rather than using a management company to do all of what would be classed as the trade. If the properties simply appear to be an investment you could not assume incorporation relief would be accepted by HMRC. They would also be likely to expect to see a sensible number of properties in this business.

Whether the relief would be challenged will be on a case by case basis, it could go through without problem or it could be rejected, leaving a big bill later if the property prices have gone up since they were purchased. The relief would be open to challenge for a number of years after.

If you wanted to be sure you could apply to HMRC for clearance of transaction but this can be costly and time consuming, also giving more chance for scrutiny. There is a case, Elizabeth Ramsey versus HMRC, which does suggest HMRC expect it to be robust property letting business with a proper amount of time each being spent in managing the properties, say 20 hours a week and such as cleaning services provided.

In a case where it is debatable whether the situation could constitute a business, it may be best to formulate a plan based around the properties individually. It has to also be remembered that a company will almost always cost more to administer which has to be balanced against any tax saving, although there is a benefit in that there is currently an additional £2,000 tax free dividend allowance and the tax rates for dividends are generally more beneficial than operating as a sole trader.

The other aspect of this tax planning is that to gain the stamp duty relief on incorporation the business must be demonstrably a partnership prior to the sale, not simply properties with two names on the deeds. Examples of evidence to support a partnership that may be considered is a partnership agreement, joint bank account, leases and agreements in the joint names etc. HMRC do have the potential to reject the partnership under SDLT anti avoidance measures and overturn any relief claimed.

how will the 2017 general election affect business in lincoln


Tax tips for the new year

  1. Use the capital gains annual exemption of £11,700 for 2018/19.  It can’t be carried forward or transferred to another person
  2. Use your ISA allowance of £20,000 for 2018/19.  The Junior ISA allowance has increased slightly to £4,260 (for children under 18). ISA allowances cannot be carried forward.
  3. Maximise the pension annual allowance of £40,000 (but tapered down for someone earning over £150,000 to a minimum of £10,000).  You can carry forward unused pension annual allowances for up to three years, so the 2015/16 allowance needs to be used by 5 April 2019.
  4. Use the inheritance tax gift exemption of £3,000, which can be carried forward one year.  So if you didn’t use it in 2017/18 you have £6,000 available in the current year.
  5. Consider transferring income producing assets to the lower earning spouse to take advantage of their personal allowance and lower tax bands.
  6.           If you make an investment in a venture capital trust (VCT) or the enterprise investment scheme (EIS), consider completing these early so that any tax repayment can be potentially be made sooner, or enabling the relief to be carried back to the previous tax year.
  7.           File your 2017/18 self-assessment tax return – if you think you are due a tax repayment, file your tax return as soon as possible so that you receive the refund.  If you had to make advance payments on account for 2017/18, it makes sense to file your tax return before 31 July 2018, so that the second payment on account could be potentially reduced.  Finally, filing your tax return early starts to limit the time window that HMRC have to raise an enquiry into your return – HMRC have one year from the filing date of your tax return to issue their enquiry.
  8.         Make any charitable donations before filing your 2017/18 tax return and you can decide whether you want to carry back the donation to 2017/18 to achieve the tax relief earlier.
Colm McCoy – Senior Tax Manager

Colm leads Nicholsons’ dedicated tax department and joined the firm in August 2014. Colm started his tax career in 1984, passed the chartered tax exams in 1989 and has now amassed over 30 years of experience. At Nicholsons, Colm advises SMEs and owner-managed businesses on their personal and business tax affairs.

When he’s not at work, Colm trains fanatically to compete in the obscure but growing sport of Crossfit. In his more sedentary moments he dabbles in problems in physics while listening to German opera or heavy metal.

 


Do you look after the finances within your business?

Financial Management Forum – May 24th 2018 at Lincolnshire Showground

We invite you to attend the next Finance Management Forum, kindly sponsored by Lincolnshire Showground, which is designed for you to network with like-minded people, as well as keep you up to date with changes that affect your business and to provide you with guidance on topical subjects.

Optional tour of showground site and facilities at 10am — 10.30am
Coffee/tea and breakfast roll will be served on arrival

Graham Dawson – Finance Manager at Lincolnshire Showground

Formed in 1869, Lincolnshire Agricultural Society has seen many changes. Graham will give you an insight into how the Society has diversified over the last 10 years.

Richard Hallsworth – Director at Nicholsons

Richard will take a look at technology and how it is affecting accounting and finance today and what the future looks like. He will also give you a brief insight into Brexit and what it means for supply chains.

Colm McCoy – Tax Manager at Nicholsons

Colm will guide you through topical tax issues facing companies including: P11d expenses and benefits, changes to company loss rules, ending of indexation and quarterly instalment payments.

Joanne Brown – Director at Nicholsons

With the new accounting regime in force, Jo will explain the accounting and audit issues businesses have to face.

To book your place click here

 


Charity Badminton Tournament creates competition

There is just one week to go until the Nicholsons 2nd Annual Charity Badminton Tournament which will be held at Deans Sport and Leisure on Monks Road. The money raised this year will go to the Lincs and Notts Air Ambulance.

Eight teams have entered the tournament and our thanks go to NatWest, JHWalter, Gelder Group, Selenity, Brewin Dolphin, Yorkshire Bank, Wilkin Chapman and team Nicholsons.

I am sure there will be some strong competition!  I hear some of the teams have been booking practice sessions – so who will take the trophy back to the office?  Will Wilkin Chapman make it to the top after taking a close 2nd place last year?

All will be revealed next Thursday.

 

 

 


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