Stop Tax Changes from Affecting Your Cashflow!
The end of the tax year (5th April) has just passed us by, and there couldn’t be a better time to sort out your business finance and plan for the year ahead. The saying ‘fail to prepare, prepare to fail’ couldn’t apply more here! By planning, you can make sure you’re aware of any changes that could affect your cashflow in the coming financial year as well as taking advantage of any reliefs and allowances available.
This frees up more working capital and keeps your cashflow stable, so you can focus on the important stuff, like attracting new clients and growing your business. So where should you start when it comes to planning for 2018-2019?
Check Out Your Allowances and Limits
Making sure you don’t fall foul of the tax man means an awareness of what your allowances and limits are for the new financial year. With the tax year running from 6th April 2018 to 5th April 2019, you’ve got plenty of time to get on top of your finances. Here are some of the key changes (and things that will stay the same) that may affect your company this year:
- VAT registration limit remains the same (and will do until 2020) at £85,000
- No rise in corporation tax – it remains at 19%
- Dividend allowance has fallen from £5,000 to £2,000
Some (or even all) of these could affect your business, depending on its size and the industry you’re in. It’s always a good idea to look into any changes that will affect you in the upcoming year, so you can plan ahead and seek support from services such as invoice factoring.
What Other Changes Could Affect Your Business In 2018-19?
This year is bringing with it some pretty significant changes that could affect businesses in all industries, like the rise of the minimum wage. This will increase from £7.50 to £7.83 for all workers aged 25 and over. It’s definitely something you’ll want to factor into your budget and plan for accordingly.
Many companies are also panicking over the rise in pension contributions. You’ll be expected to double your contributions from 1% to 2% of an employees’ salary (provided they opt in and contribute 3% themselves). These changes are likely to hit small businesses the hardest, so what can you do to minimise their impact on your cashflow?
Act Now – Don’t Wait Too Long!
It pays to be organised, whichever industry you’re in. There are schemes and services available that can help stop tax changes from affecting your cashflow. If you’re a small business seeking investors to help with growth, it’s worth looking into the Enterprise Investment Scheme, which has increased its limit to £2 million for the coming year. Another great option is invoice factoring, or confidential invoice discounting. If you’re not too sure where to start with this, invoice finance brokers are the people to ask. They can match you with an invoice funder with experience in your specific industry (whether that’s recruitment, haulage or construction) and you can enjoy more stable cashflow in the coming financial year.
How Can Invoice Finance Brokers Help?
Invoice factoring and discounting helps your business by freeing up the cash tied up in your unpaid invoices. This is normally released into your business bank account within 24 hours, so you can take care of salary increases caused by the minimum wage rise and ensure you meet your tax commitments to HMRC. Invoice funders can even take responsibility for chasing your clients for payment when it becomes due. If you prefer to do this yourself, then confidential invoice discounting is an attractive option with all the benefits of invoice factoring.
Do it Simply – Get in Touch!
Don’t sit around waiting to see how this year’s tax changes are going to impact your cashflow. Take action today and get in touch with Simply Factoring Brokers. We are invoice finance brokers who can match you with some of the most experienced funders around, at great rates. To find out more, just give our experts a call on 0330 134 2826, or drop us an email at firstname.lastname@example.org and we’ll reply as soon as we can.
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