Originally written by Natasha Heron on Small Business
When purchasing an investment property one of the first considerations is whether it should be held personally or within a company wrapper.
A company is a separate legal identity to its owners; therefore, the asset belongs to the company rather than the shareholders or directors. Rental receipts and proceeds from subsequent disposals belong to the company and are subject to corporation tax at the current rate is 19 per cent. Profits can be extracted via salary or dividends both of which are subject to income tax and national insurance at varying rates depending on the level of income received by an individual within a tax year.
The key question to ask is “What is your intention for the profits?”
>See also: Landlord tax relief changes: Why property owners should consider a limited company
If the intention is to reinvest proceeds or to build up cash reserves, a corporate wrapper may be preferential because if the profits are not required to be extracted then they are not subject to income tax. If the property is held in personal names those profits are taxed on receipt.
Individuals used to be able to claim interest paid on buy-to-let mortgages as a
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Adapting for disabled customers
by Anna Jordan • • 0 Comments
Originally written by Anna Jordan on Small Business
The Equality Act (which replaced the Disability Discrimination Act) affects the way you treat your staff, job applicants and customers. Under the Equality Act, small and medium-sized businesses have to make ‘reasonable adjustments’ so they do not discriminate against disabled customers.
The law has been designed so that you only have to make reasonable changes, but if you fail to do what is reasonable, a disabled person could take legal action against you for treating them unfairly. It could be based on a policy or a one-off action.
What is ‘reasonable’ for my business?
To operate within the law, you should consider the following when deciding what sort of change is likely to be reasonable for your company:
Type of business
Annual turnover
Cost of the adjustment
Disruption to the business while the work is being carried out
Practicality of carrying out the adjustment
Potential benefits to disabled customers
What is reasonable depends on a number of factors, including the resources available to the organisation making the adjustment.
The Equality Act states that you must not treat disabled customers unfairly, no matter what size your company is. If your organisation is not accessible to disabled people, you could be missing out on a lot
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Gaining settled status for European employees – what employers should do
by Helen Jamieson • • 0 Comments
Originally written by Helen Jamieson on Small Business
On top of the Covid-19 headache, there are growing concerns that many European nationals are unaware of what they need to do to continue working in the UK, such as applying for settled status.
Research from The Joint Council for the Welfare of Immigrants earlier this month warned that one in seven EU care employees was at risk of losing their immigration status as a result of changes to regulations. This indicates a worrying lack of awareness among EU employees about the need to act now to secure working status.
If your European employees fail to secure this settled status (or pre-settled status) before the deadline they run the risk of losing their right to remain in the UK. That could be a massive blow to your business.
It is essential that, as an employer, you know where you stand in relation to the new immigration rules and that you support your employees to do what they need to do.
What do European employees need to know about securing the right status?
There are mounting concerns that many EU, EEA and Swiss nationals do not know they need to apply for settled status, with some believing that as
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What is the UKCA mark and how does it affect my small business?
by Anna Jordan • • 0 Comments
Originally written by Anna Jordan on Small Business
Now that we’ve left the EU, small businesses need to think about changes to how they label their products, including the UKCA.
We clear up what the UKCA mark is and what you need to do to keep compliant.
What is the UKCA mark?
The UK Conformity Assessed (UKCA) mark, pictured left, is a marking for products on the market in Great Britain (England, Scotland and Wales). It replaces the CE mark.
Do I need to use the UKCA marking?
If you’re selling goods within Great Britain – and they previously needed the CE mark – then yes. As well as goods that have previously needed the CE mark, it’s needed on aerosols which previously needed a ‘reverse epsilon’ marking, as shown below.
The UKCA came into effect on January 1 2021 once the Brexit transition period ended. However, an adjustment grace period has been allowed so you can still use the CE mark until January 1 2022 while you make adjustments. You should be looking to change to the UKCA mark as soon as possible though.
You only need to use the UKCA before January 1 2022 if all of the following apply:
Your product is for the market in
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8 legal considerations for setting up a business during the pandemic
by Nick Owens • • 0 Comments
Originally written by Nick Owens on Small Business
Record numbers of new businesses are setting up amid the Covid-19 pandemic as entrepreneurs show a determination to work their way out of the financial crisis.
The stories behind many of those newly formed businesses is revealed in a special report, Starting A Business In A Pandemic, published by Harper James Solicitors. Here the national law firm, designed to support new businesses from start-up to scale-up, share eight legal considerations that every entrepreneur should be aware of.
1. Founders Agreement
You and your co-founders may start out as best friends, but nothing can sour a relationship more quickly than differences about business.
A founders’ agreement will clearly set out all the answers to essential questions such as: what is the company’s mission and what is your ultimate goal? What are the roles and responsibilities of each team member? And how will equity be owned and when will shares vest? As businesses grow, the formalities tend to multiply and having a clear founders’ agreement will make these formalities easier (and cheaper) to complete.
2. Shareholder and investor agreements
Setting up a shareholders’ agreement can help take your start-up to the next stage. If you are funding your start-up yourself, then
Hot Business News Today
8 legal considerations for setting up a business during the pandemic
by Nick Owens • • 0 Comments
Originally written by Nick Owens on Small Business
Record numbers of new businesses are setting up amid the Covid-19 pandemic as entrepreneurs show a determination to work their way out of the financial crisis.
The stories behind many of those newly formed businesses is revealed in a special report, Starting A Business In A Pandemic, published by Harper James Solicitors. Here the national law firm, designed to support new businesses from start-up to scale-up, share eight legal considerations that every entrepreneur should be aware of.
1. Founders Agreement
You and your co-founders may start out as best friends, but nothing can sour a relationship more quickly than differences about business.
A founders’ agreement will clearly set out all the answers to essential questions such as: what is the company’s mission and what is your ultimate goal? What are the roles and responsibilities of each team member? And how will equity be owned and when will shares vest? As businesses grow, the formalities tend to multiply and having a clear founders’ agreement will make these formalities easier (and cheaper) to complete.
2. Shareholder and investor agreements
Setting up a shareholders’ agreement can help take your start-up to the next stage. If you are funding your start-up yourself, then
Hot Business News Today
How going insolvent could be the best way to save your business
by Andrew Shipp • • 0 Comments
Originally written by Andrew Shipp on Small Business
These are without doubt, unprecedented times. Small businesses in virtually every sector are struggling financially and facing concerns about what is ahead and how they will survive.
Since May over a million bounce back loans have been issued, the 100-per-cent Government-backed loan scheme to support small businesses during the pandemic. But according to banks, it’s expected that half of these loans won’t be paid back, with many small business kicking bad debt further down the road.
If your company is “insolvent” – meaning it’s unable to pay its debts – or you’re worried that this is likely to be the case in the near future, then it’s important to consider your options.
>See also: Where to find your £5,000 small business technology grant
As a director, not only do you owe various duties to the company, including to act in its best interests, but you also face the risk of personal liability for debts incurred by the company, if you continue to trade once you are aware, or should be aware, that the company is insolvent.
There is no “one size fits all” solution if your company finds itself in such a position. For some, liquidation may be
Hot Business News Today
How going insolvent could be the best way to save your business
by Andrew Shipp • • 0 Comments
Originally written by Andrew Shipp on Small Business
These are without doubt, unprecedented times. Small businesses in virtually every sector are struggling financially and facing concerns about what is ahead and how they will survive.
Since May over a million bounce back loans have been issued, the 100-per-cent Government-backed loan scheme to support small businesses during the pandemic. But according to banks, it’s expected that half of these loans won’t be paid back, with many small business kicking bad debt further down the road.
If your company is “insolvent” – meaning it’s unable to pay its debts – or you’re worried that this is likely to be the case in the near future, then it’s important to consider your options.
>See also: Where to find your £5,000 small business technology grant
As a director, not only do you owe various duties to the company, including to act in its best interests, but you also face the risk of personal liability for debts incurred by the company, if you continue to trade once you are aware, or should be aware, that the company is insolvent.
There is no “one size fits all” solution if your company finds itself in such a position. For some, liquidation may be
Hot Business News Today
How to deal with a furloughed employee who refuses to return to work
by Molly Dilling • • 0 Comments
Originally written by Molly Dilling on Small Business
Across the country tens of thousands of employees are being asked to return to work. But many employers are faced with a furloughed employee who refuses. The most obvious parallel is in schools, where unions, local councils, parents and teachers fundamentally disagree on how and when to reopen.
Similar stories are emerging about employers and staff, in sectors large and small, across the country. What rights do employers have in such cases, and how do you protect yourself against a detriment/dismissal claim?
Can a furloughed employee refuse to return to work?
The issue many employers are grappling with is whether a furloughed employee who refuses to return to work because of a stated fear of catching coronavirus can be dismissed.
Under the standard employment contract, the furloughed employee is obliged to follow reasonable instructions. One of those instructions contained in the employment contract will be that employees are to attend work within the hours set out.
The key issue in employment law is what is reasonable, and this depends on the precise facts of the case. As a result of the possible ambiguity an employer should carefully consider potential consequences before taking any disciplinary action for failure to
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Tenants back to facing eviction for non-payment of rent as shops reopen
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
UPDATED: The Government appears unlikely to extend tenant protection from commercial landlords who want to evict them for non-payment of rent because of Covid-19.
The business department had given shops, pubs and restaurants three months of protection from eviction for non-payment of rent during the coronavirus lockdown.
But a draft code of practice seen by the Financial Times on how landlords should treat commercial tenants as small businesses emerge from lockdown makes no mention of extending the eviction grace period.
>See also: 4 ways small shops can reinvent themselves post coronavirus
Many businesses had assumed the current eviction suspension would be extended past June 24, the next rent quarter day.
If so, many businesses could find themselves forced out of commercial premises for non-payment of rent due to Covid-19.
Instead, the code, which is voluntary, states:
Tenants should pay rent if they can, even if only partially
Landlords who are in a position to show clemency should do so
Tenants should prioritise paying service charges before rents
James Daunt, chief executive of bookshop chain Waterstones, told the FT that what is needed is statutory protection for tenants from aggressive landlords.
Daunt said: “As soon as current protections expire, I think there will be some