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					             Winter 2010


             PROFILE
             News, Views & Financial Updates




Youth Wins
  the Day!


             Tax Avoidance Schemes
             VAT Rate Change
             Countdown to the Olympics
             Clarified ISAs
             Nurturing Small Businesses
                                               Young Enterprise
                                            Princecroft Willis will once again be          company rooted in the community. This is
                                            playing an active role in the latest Young     one way we can put something back into
                                            Enterprise company programme. Last             that very same community.”
                                            year more than 300 young people from
                                                                                           This year James, together with James
                                            21 Dorset schools gained a valuable
                                                                                           McDougal, Tax Assistant, will be providing
                                            insight into the real world of business by
                                                                                           mentoring and advice skills to students at
Study any successful business or            taking part in the innovative scheme.
                                                                                           Poole High School. In addition, Claire Wait,
organisation and one thing always           PcW Partner James Robinson and Gemma           Accounts Senior, is mentoring students at
stands out. They are constantly             Chatfield, Business Services Senior,           St Aldhelm’s Academy in Poole. “The
evolving, ensuring their goods and          provided help and advice to a group of         Young Enterprise programme is an
services remain in tune with both           Year 12 students at Poole High School (see     excellent scheme which really brings
existing and future clients. That goes      front cover image). Their company,             business alive for young people. We’re
for our business as much as yours. The      Squeeze, sold a coffee coaster with a built-   proud to be associated with such a
sad truth is that companies who stand       in puzzle aimed at office workers and the      successful programme,” added James.
still ultimately wither and die.            commercial market.
                                                                                           If this is of interest and you would like
In the case of Princecroft Willis we        “The students got a lot out of it and,         to know more please contact James
place huge emphasis on the quality of       to be honest, so did we,” explained James.     Robinson on 01202 663607.
our team. Which is why we’re delighted      “PcW prides itself on being a locally-based
to welcome two new senior team
members. Heather Williams has joined
us as Corporate Tax Director while
Chloe Tout is Director of Audit and
Accounting Services. We also welcome
                                               Private Client Services
a further 16 team members who have
joined us during the course of the year.
Their arrival is a further demonstration    In a climate of tax rises and more             • Structuring wills that work from a tax
of our determination to invest in our       aggressive tax collection, individuals are       perspective and protect assets from
people, making sure you have access to      looking much more closely at legitimate          changes in family circumstances;
the best specialist skills available.       tax planning and ordering their affairs so
                                                                                           • Doubling entitlement to Entrepreneurs’
                                            as to minimise their tax exposure.
But, of course, we accept that one size                                                      Relief on a share sale;
                                            Demand for our Private Client services is
doesn’t fit all. As you’ll see in this      at an all time high. Examples of recent        • Advice on residence and domicile
edition of Profile, we now have a           assignments include:                             planning; and
dedicated Small Business Unit at both
our Poole and New Forest offices. It        • Income tax planning to preserve              • Saving inheritance tax on the
offers an efficient and cost effective        personal allowances and reduce tax             family home
service to start-ups and smaller              exposure at the higher rates;
                                                                                           Many strategies are simple to implement
businesses. Big or small, sole trader,
                                            • Using main residence relief to               and just require some forward planning.
multi-million pound turnover company
                                              eliminate capital gains tax on a             Others are more complex but are well
or somewhere in between, we really
                                              “buy to let” property;                       worth the effort. Julian Smith heads our
can cater for your every need.
                                                                                           Private Client group and will be happy to
                                            • The use of trusts to transfer
That, incidentally, includes outsourcing.                                                  provide further information. He can be
                                              investments to the next generation
The savings can be significant as the                                                      contacted on 01202 663613.
                                              without generating any capital gains
team at our outsourcing company,
                                              tax charge;
PW Business Solutions, will be happy
to confirm. Payroll, bookkeeping,
management accounting services -
these are just some of the services
offered by PWBS. It really is worth            Sparkle Appeal
putting a call in to them.
Finally, have you checked out
                                            Our private client tax partner, Julian
our new-look web site at
                                            Smith, is running the London Marathon
www.princecroftwillis.co.uk?
                                            on 17 April 2011 in aid of the Sparkle
It gives you all the information you
                                            Appeal Dorset which is raising money for
need – and a lot more as well. You can
                                            a new hydrotherapy centre at the Victoria
even sign up for our Twitter feed!
                                            Education College in Poole. Such is his
As always, my thanks for your               determination to raise as much money as
continued support and, on behalf            possible for this worthy cause that he is
of all the team at Princecroft Willis,      training daily and has even joined a
our very best wishes for Christmas          running club! He is aiming to break the
and the New Year.                           3 hour barrier.
                                            If you would like to sponsor Julian,
MARK AITCHISON                              please visit his fundraising page at
                                            www.virginmoneygiving.com/JulianSmith1
                                                                                                   Would you
    Countdown to the Olympics
                                                                                                   Like Tax Relief
                                                                                                   of up to 65%?
                                                                                                   There have been a considerable
                                                                                                   number of changes in the pensions
                                                                                                   world over recent years and the new
                                                                                                   coalition government has decided to
                                                                                                   continue with this! However the
                                                                                                   proposed changes from next year do
                                                                                                   provide some significant planning
                                                                                                   opportunities for some. With the
                                                                                                   number of ways of reducing tax
                                                                                                   becoming limited it’s worth looking at
                                                                                                   this area again. In particular :
Ben Ainslie. Photo courtesy of Skandia Team GBR/Ocean Images
                                                                                                   • Remember that everyone can pay
Less than 600 days to go before the                  Olympic classes Great Britain have some         money into a pension up to a certain
2012 Olympics and the eyes of the world              of the very best talented sailors in the        level and get tax relief, even if you
focus on the UK. It’s an exciting time, not          world. It’s not unrealistic to say that all     don’t actually have any earnings or
just for the athletes competing for                  the sailors selected to represent us in         pay tax. We have seen many clients
selection but also for the team at                   Weymouth will have a genuine chance of          take advantage of this to fund
Princecroft Willis. There aren’t many                success,” explained Martin.                     pensions for children or grandchildren
accountancy firms that can proudly                                                                   for example;
                                                     “Great Britain Is the world’s top Olympic
boast several of the UK’s top sportsmen
                                                     Classes sailing nation with the British       • If you are lucky enough to earn over
and women, particularly in sailing,
                                                     Olympic team sailors topping the medal          £100,000 you now begin to lose
among their clients. But we can.
                                                     table at the past three Games in 2000,          your personal allowances (this is the
In fact, PcW Partner Martin Aldridge –               2004 and 2008. The selection process for        first slice of income you earn before
himself a former windsurfing world                   the 2012 Olympics begins in earnest in          paying tax) until those with earnings
champion – looks after Ben Ainslie, Iain             2011. Needless to say, we wish all our          over £112,950 have no personal
Percy, Andrew Simpson and Paul Goodison              clients the very best of luck for 2011 and      allowances. A pension contribution
as well as Nick and Sarah Dempsey and                onwards to 2012.”                               for those affected by this effectively
other top athletes. “In many of the                                                                  reduces your taxable income and gets
                                                                                                     back your allowances. It means tax
                                                                                                     relief of up to 60%;

    IT Corner                                                                                      • If you are even luckier and are a “high
                                                                                                     earner” (i.e. you earn over £130,000)
                                                                                                     you will have had limitations on how
                                                                                                     much you can pay into pensions over
                                                                                                     the last couple of years. From April
E-MAIL ADDRESSES
                                                                                                     2011 this looks set to change and
In order to send high quality information                                                            an annual amount of £50,000
to clients on a timely basis, we are                                                                 is available. You may also be able
increasingly communicating with our                                                                  to pay an increased amount to
clients by e-mail. We are “purging” the                                                              catch up from previous years.
information on our database in order to                                                              This for some could mean tax relief
ensure that it is up to date. To ensure you                                                          of 50% on these contributions plus
receive our publications, if we have not                                                             savings on National Insurance;
communicated with you by e-mail in the
past or your address has changed, please                                                           • If you are a director or are employed
e-mail Chris Baker at chris.baker@                                                                   look again at “salary sacrifice”.
princecroftwillis.co.uk so that she can                                                              This reduces your salary from the
update your details.                                                                                 company in exchange for a tax
                                                                                                     allowable pension contribution. It
OUR WEB SITE                                                                                         means tax relief at source and saving
You may have seen our recent                                                                         on National Insurance. Combine this
articles on the “new look” web site.                                                                 with point 2 above and the effective
We will be using this more and more to                                                               rate of tax relief can be 65%.
communicate with our clients so please                                                             If you would like to discuss this further,
visit www.princecroftwillis.co.uk and add                                                          please get in touch with our Business
us to your “Favourites”.                                                                           Tax Director, John Caithness (01202
We intend to use Twitter and LinkedIn as                                                           663620)
a tool to advise of new additions to our
web site.
   PcW Nurtures                                                          Company
   Small Businesses                                                      Annual Returns




Many businesses grow, taking on employees and expanding               With the change to electronic filing of Annual Returns,
premises, but others will intentionally stay small. Not everyone      Companies House has changed the way it contacts companies
is looking to build an empire!                                        to remind them of the need to file these.
We recognise that all businesses are different and have a             Previously they sent out a partially completed Return to the
dedicated Small Business Unit in both our Poole and New Forest        registered office a couple of weeks before the required date.
offices. The unit provides an efficient and cost effective service    They are now sending out a letter headed up “NOTICE – Annual
to our start-ups and smaller businesses, and helps manage each        Return – REMINDER”. This is sent out a few days before the date
business throughout its lifecycle.                                    that the Return has to be made up to and can give the false
                                                                      impression that the Return has been overlooked and not
Going into business for the first time brings the excitement and
                                                                      prepared. Actually, the Return can’t properly be prepared before
challenge of working for yourself. However, this enthusiasm can
                                                                      the date it is due to be made up to in case the information
often be dampened by all the decisions and form filling required
                                                                      changes in the intervening period.
at the outset. To help small businesses get started we offer a free
initial meeting. Once the business is up and running there will       Please be assured that if we deal with the company secretarial
always be someone at our offices to help with any queries that        matters for your company we have a system which flags up the
arise. When the business begins to grow we’ll be there every step     due dates for Annual Returns and these will be completed and
of the way providing strategic support and ensuring that the          sent to you for approval as soon as possible after the date they
business meets any compliance deadlines that arise.                   need to be made up to and before the 28 day filing deadline.
We appreciate that most smaller businesses try to keep costs          If we do not deal with company secretarial matters for you
to a minimum and we are able to provide a fixed fee option.           and you would like us to undertake this work we would be happy
If this is of interest, please ask your engagement partner.           to do so. Please contact any of our Company Secretarial Team
                                                                      for assistance.
Our Small Business Unit at Poole is headed by Partner
James Robinson (01202 663607) and at New Forest by                    New Forest Office Carol Cook (01425 625524)
Partner Anne-Marie Gates (01425 625533).
                                                                      Poole Office Sharon Fee (01202 663677) or Sue Ormond
                                                                      (01202 663691)




   Welcome to the Team
We continue to invest in high quality team members to enable          POOLE OFFICE
us to provide the best possible service to clients. Over the past     Karen Maple (Assistant Secretarial Team Manager); Mary
year we have been delighted to welcome the following new              Acreman (Business Services Assistant); Dan Holt (Accounts
team members to the firm.                                             Senior); Shona Cox (Accounts Senior); Chris Way (Graduate
                                                                      Accounts Trainee); Helen Ford (Secretary); Emma Symons
                       Heather Williams                               (Graduate Accounts Trainee); Jelena Ibragimova (Placement
                       Corporate Tax Director
                                                                      Student – Accounts); Sue Tellier (Receptionist); Katy Oxley
                       Direct: 01202 663612                           (Business Services Trainee); Jamie Bennett (Business Services
                       Mobile: 07703 496156                           Trainee) and Rob Crocker (Graduate Tax Trainee)
                       heather.williams@princecroftwillis.co.uk
                                                                      PWBS OFFICE
                       Chloe Tout
                       Director of Audit & Accounting Services
                                                                      Helen Phillips (Assistant Payroll Manager); Kelly Fugill (Payroll/
                                                                      Office Administrator); Adrian Christie (Accounts Assistant) and
                       Direct: 01202 663617
                                                                      Gill Aberdein (Accounts Assistant)
                       Mobile: 07766 014410
                       chloe.tout@princecroftwillis.co.uk
    We go to Great Lengths!                                                                       Clarified ISAs
                                                                                                  UK auditing standards have been
                                                                                                  updated by the Auditing Practices
                                                                                                  Board (APB) to comply with the new
                                                                                                  clarified international auditing
                                                                                                  standards. The new International
                                                                                                  Standards on Auditing (UK and
                                                                                                  Ireland), referred to as Clarified ISAs,
                                                                                                  will replace the previous ISAs for
                                                                                                  audits of financial statements for
                                                                                                  periods ending on or after 15
                                                                                                  December 2010.

                                                                                                  WHAT’S CHANGED?
                                                                                                  The Clarified ISAs have a new structure
                                                                                                  which reflects the purpose of the
                                                                                                  clarity project – to make the
                                                                                                  requirements of the standards easier
                                                                                                  to understand and to make clear what
                                                                                                  is required. The main areas of change
L-R: James Robinson, Jo Tolley, 19-month-old Annabelle Chapman, Sam Chapman.
                                                                                                  for the typical Princecroft Willis audit
                                                                                                  client include:
Some people take to running their own               highly enough. “They’ve been amazingly
                                                                                                  • Related parties - The revised
business like a duck to water. In the case          supportive and very knowledgeable,” said
                                                                                                    ISA includes a number of specific
of Steve and Jo Tolley it would be more             Jo. Of course, not every small business
                                                                                                    new requirements to improve
accurate to say a baby to water. For the            can ‘swim’ in the same way as Water
                                                                                                    the identification of related party
couple own the Dorset franchise of Water            Babies. PcW’s Small Business Unit in both
                                                                                                    relationships and transactions.
Babies, the world’s largest baby                    our Poole and New Forest offices is
swimming company.                                   dedicated to not just keeping ventures        • Estimates - The ISA introduces
                                                    afloat but positively flourishing.              new requirements to the audit of
Since taking the plunge and going it alone
                                                                                                    accounting estimates, including
in 2008 Steve and Jo have seen dramatic             It provides an efficient and cost effective
                                                                                                    consideration of indicators of
growth. Their business now teaches more             service to start-ups and smaller
                                                                                                    possible management bias.
than 500 babies a week, aged from two               businesses, and helps manage each
weeks to four years, at 13 pools across the         business throughout its lifecycle.            • Communicating deficiencies in
county. “It’s taken off faster than we                                                              control - This is a new ISA which is
                                                    For further information please contact
thought,” said mother-of-three Jo. “In                                                              designed to improve the way in which
                                                    James Robinson on 01202 663607.
fact, we now have a waiting list.”                                                                  auditors report control deficiencies
                                                                                                    to management.
Water Babies became a client of
Princecroft Willis last year and can’t praise                                                     • Groups - The ISA introduces
the firm – and Partner James Robinson -                                                             significant requirements in to the
                                                                                                    audit of groups especially those
                                                                                                    which include overseas or remote
                                                                                                    companies where a greater emphasis
    VAT Rate Change –                                                                               is now placed on the collection of
                                                                                                    data and assessment of audit risk.

    Are You Ready?                                                                                There have been a number of articles
                                                                                                  about Clarified ISAs in the business
                                                                                                  press and the number of compulsory
                                                                                                  requirements in the Clarified ISAs
4 January 2011 will see the VAT standard                                                          increasing by 35%. The impact of the
rate rise to 20%, the third change in the                                                         changes will obviously vary from audit
rate in 27 months – as many as there                                                              to audit and are not necessarily a
have been in the previous 27 years!!                                                              driver of increased cost, as many of
HMRC have issued detailed guidance on                                                             the new requirements were already
how the change will be implemented and                                                            established good practice.
its effects, which is consistent with the                                                         One consequence however is that
treatment applied for the last change                                                             companies requiring an audit will
introduced on 1 January 2010.                                                                     need to ensure they have good
PcW have published a summary guide                                                                systems in place and seek good advice
to help clients and professionals manage                                                          if they feel their systems of control
the change, which can be found at                                                                 could be improved.
www.princecroftwillis.co.uk/whats-new/                                                            All of our team involved with audits
publications, or for more detailed                                                                have now had training in the
guidance, please contact our VAT Director,                                                        application of the new standards and
Simon Anslow, on 01202 663611.                                                                    your engagement partner will be able
                                                                                                  to give you guidance as to how it
                                                                                                  affects your company.
           Client Success:                                                                                                     Tax Avoidance
           Intec Printing                                                                                                      Schemes - Not for
           Solutions                                                                                                           the Faint Hearted
                                                                                                                         You have probably heard Government ministers repeatedly
                                                                                                                         saying that tax avoidance schemes must be stopped although
                                                                                                                         this is easier said than done. They also deliberately blur the
                                                                                                                         distinction between tax avoidance which is legal and tax
                                                                                                                         evasion which is illegal.
                                                                                                                         Tax avoidance schemes are normally created by very clever tax
                                                                                                                         barristers in London and seek to exploit loopholes in the tax
                                                                                                                         legislation. As soon as the Government closes one loophole,
                                                                                                                         another one appears. The schemes are generally marketed by
                                                                                                                         specialist tax boutiques and come with quite chunky fees. We
                                                                                                                         can introduce interested clients to scheme providers, where the
                                                                                                                         possible tax savings can be justified.
                                                                                                                         The two most common schemes relevant to our clients are:
                                                                                                                         • Employee Benefit Trusts which attempt to get company
                                                                                                                           profits into the hands of the owners by avoiding the income
                                                                                                                           tax which would be payable on dividends; and
                                                                                                                         • Stamp Duty Land Tax avoidance schemes in connection with
                                                                                                                           the purchase of expensive residential or commercial property.
     L-R Bill Law, Ian Melville, Robert Syms MP. Photo courtesy of Deep South Media                                      We are often asked whether a scheme works. This is impossible
     Ian Melville’s story is inspirational. He started his company,                                                      to answer since schemes rely on a particular interpretation of
     Intec Printing Solutions (www.intecprinters.com), on the old                                                        legislation with which HMRC will generally not agree. Often the
     Enterprise Allowance scheme paying £40 a week.                                                                      answer will not be known until a scheme goes before the
                                                                                                                         courts. Beware of anyone who claims that a tax scheme is
     Within six months Ian had been kicked off the scheme for making                                                     Revenue approved or guaranteed to work as this is simply not
     too much money. By the end of his first year the business had                                                       the case.
     turned over £250,000 and made a £48,000 net profit. Twenty
     years later Intec employs 22 staff, has a £4 million turnover and                                                   Any client undertaking a tax avoidance scheme should expect
     exports to 60 countries. Princecroft Willis, and its predecessor                                                    to undergo a Revenue enquiry and this can often take several
     firms, has been with him every step of the way.                                                                     years to resolve. The client will also give themselves a high
                                                                                                                         profile with the Revenue which may result in other aspects of
     Poole MP Robert Syms was the special guest at Intec’s                                                               their tax affairs being investigated.
     anniversary celebrations. The Hamworthy based firm, which
     began life distributing manufacturers’ branded products to the                                                      The Government have announced that action will be taken to
     pre-press and graphics industry, now manufactures a range of                                                        stop the use of Employee Benefit Trusts and Employer Financed
     printing solutions.                                                                                                 Retirement Benefit Schemes for tax avoidance from 6 April
                                                                                                                         2011. There are no details of how this will be done but there is
     It also supports a number of overseas projects including all the                                                    probably a short window of opportunity to take advantage of
     funding for a new church and community centre in the tea                                                            these arrangements.
     growing highlands of Sri Lanka. Ian, who is Intec’s owner and
     Managing Director, said: “One thing that really motivates me is                                                     There is also talk of a GAAR (general anti-avoidance rule)
     being able to make a difference.”                                                                                   being introduced although we understand that the Revenue is
                                                                                                                         lukewarm to the idea because of the uncertainty it would create
     PcW Partner Bill Law said: “In business the goalposts always                                                        between tax avoidance and sensible tax planning.
     move but over the years Ian has proved adept at changing his
     business model to react.                                                                                            Please contact John Belinger (01202 663605) or Julian Smith
                                                                                                                         (01202 663613) if you are interested in further information.
     “Above all, the success of Intec shows the importance of
     nurturing small businesses. It’s that ‘acorns to oaks’ approach
     which has led to the formation of our dedicated Small
     Business Unit.”




     Contact Us                             Poole Office
                                            Towngate House
                                                                                                  New Forest Office
                                                                                                  The George Business Centre
                                            2-8 Parkstone Road                                    Christchurch Road
                                            Poole Dorset BH15 2PW                                 New Milton BH25 6QJ
                                            Tel: 01202 663600                                     Tel: 01425 610166
                                            Fax: 01202 663601                                     Fax: 01425 638080
                                            poole@princecroftwillis.co.uk                         newforest@princecroftwillis.co.uk                                      www.princecroftwillis.co.uk

The information within this newsletter is published without responsibility on our part for loss occasioned to any person acting or refraining from action as a result of the articles appearing herein.

				
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