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Tips to ease the tax responsibilities for business owners (Part 2)

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Here are some more tax-easing tips for people who have decided to work from home or form their own home-based businesses. Business solutions experts swear by the effectiveness and relevance of these tips:

1. Ensure the accuracy of your record keeping and book keeping. In order to help individuals about this, the HM Revenue & Customs (HMRC) has issued a user-friendly booklet that advises which records the office would likely ask from self-employed individuals. Basically, records should be kept of all income, all expenses and to have backing documentation for these.

2. Not all expenses can be used to lower the tax bill. It is a common misconception that all expenses can be claimed for tax purposes. The reality is, only expenses that have been used wholly and exclusively for the purpose of the business can be applied for tax relief.

3. Think carefully and study whether to use a room in the home for solely business purposes. A dedicated room will enable you to properly apportion all of your household expenses (lighting, heating, mortgage) and claim a proportion. But then doing this may also mean losing a part of the capital gains tax exemption when the property is sold. Weigh the pros and cons before deciding what to do.

4. Factor in the risk that will be involved in the business as this will help you in determining whether you want to set up the business as a sole owner, enter into a partnership or form a company.

Most businesses do not have a good business plan

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A recently released business survey has presented some alarming information that businessmen and entrepreneurs should take into consideration.

According to the survey, most business plans prepared by entrepreneurs and businessmen are poorly prepared and written. These business plans also have crucial missing parts or information gaps.

The survey has pinpointed that these poorly made business plans usually don’t have a thorough marketing plan. Another part that is usually missing in these business plans is a financial forecast. In terms of actual data and content, the survey also revealed that these “faulty” business plans would usually contain overly optimistic forecasts and business growth assumptions that are not backed up by relevant and accurate data.

These are major faults that seriously undermine not only the credibility of the business plans but also put into question its effectiveness.

Business solutions experts advise entrepreneurs to invest a lot of time and effort in formulating a business plan. The first thing that businessmen should be aware of is to use accurate data in making the plan. A plan that is not based on actual facts is even worse than not having a plan at all because they can be lulled into a false sense of complacency.

Company formation professionals also urge against rushing this important step towards setting up a business. They advise that it would be better to approach company formation services to handle the tasks of setting up the company structures so that entrepreneurs can focus their time and energy on thoroughly researching and preparing a viable business plan.

Black-, Ethnic minority-owned businesses are more successful

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A revealing new survey shows that businesses run by blacks and other ethnic minorities are proving to be more successful when compared to similar white-owned companies.

This radical new view about business and race has led the UK government to encourage minority groups, especially those living in communities that do not have a large concentration of businesses, to start their own companies as a way of jumpstarting economic growth in their respective communities.

A study done by Barclays Bank has revealed that business start-ups from the black and ethnic minority communities are three times more likely to turn in profits compared to white-owned start-ups. These profits were projected to run between £250,000 and £1 million.

The Bank has attributed this interesting result to the rising number of young black and ethnic minority entrepreneurs. More than twice of these people are deciding to run their own businesses compared to their white contemporaries.

According to figures compiled by Barclays, in 2004, 50,000 new businesses were identified to have black and/or ethnic minority entrepreneurs or owners. Compare this to only 32,000 businesses about four years ago.

In addition to encouraging blacks and ethnic minorities to set up new companies, the government is also planning to promote starting a new business specifically to women. This is based on research that there are fewer female entrepreneurs compared to men.

The expected rise of new start-ups is also encouraging news for Company formation and Business solutions professionals who expect to see an increased demand for their services.

Venture capitalist service encourages business development

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For most would-be entrepreneurs finding capital to start up a business is one of the most difficult obstacles that must be overcome. The best business ideas will never move beyond the planning stage when there is no capital infused to actually take that idea off the ground.

Now, an avenue has been opened for entrepreneurs who are in the midst of raising capital. A big private funding resource is now available from a new collective of visionary businessmen.

The Development Capital Exchange (DCX) is a new information exchange through which prospective entrepreneurs can possibly meet other businessmen/entrepreneurs who have available funding that they want to use to invest in other businesses. DCX has more than 200,000 entrepreneurs who are willing to invest £20,000 to £500,000 in various enterprises.

DCX’s main purpose is to help release information between investors and fund-seeking entrepreneurs. The business opportunities that are mainly dealt with in DCX are primarily those that can be covered under the Enterprise Investment Scheme, a measure that aims to introduce tax incentives for those wanting to put up an entrepreneurial investment in early-stage companies. Other businessmen, on the other hand, want to bring in their expertise in business so that they can impart them to ensure that growing enterprises achieve a more than favorable chance for success.

With funding services like DCX and a growing trend in using company formation companies and business solutions professionals – the prospects of bringing a business idea into fruition has become a whole lot easier for many entrepreneurs.

5 Smart Tips for Progressive Companies

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Humanity may just be moving out from the dark ages, which means that businesses are going to have to do the same thing. Old practices will be replaced with new practices. Old modes of work will be replaced by new ones. And hopefully better ones! Work will be more efficient. Hopefully, people will be happier!

But what are some smart things that companies that consider themselves progressive can do to move this sort of attitude forward? Consider the five following tips in the categories of knowledge transfer, social media, video culture, new industries, and work values. [Read more…]