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1 We re happy to stay for another 10 years We have renewed our commitment to Leicester after signing a new 10-year lease at our head office and also carrying out a recent re-branding exercise across the firm. Brand new interior and exterior signage featuring a fresh, innovative logo has been installed at our head office on Regent Road, which has also undergone substantial internal refurbishment. The re-branding of our two branches in Loughborough and Nottingham is due to complete later this year. We have also recently unveiled a new state-of-the-art website, at, designed to give visitors as much information about us and our services as possible. Why not visit our website to see the vast changes we ve made and at the same time you can register to receive our monthly Newswire. This is ed once a month and is packed full of essential business news and handy tax tips to help save you money. Chris Castleman, Managing Partner, says, We strongly believe that the Newby Castleman name has a solid pedigree within the region but this re-branding exercise is a good way of raising the firm s profile even further. We ve been here for 30 years and whilst we had looked at going somewhere on the outskirts of the city, it s important for a business like ours that we re in the city centre. We re planning to be around for a good few years yet, so we want to continue building the business. Teaming up with the Tigers We have shown our support for Leicester Tigers with three brand new advertising boards at the club s Welford Road stadium. Supporters at the 24,000 capacity home of the current Guinness Premiership champions will see the Newby Castleman name proudly displayed in prominent positions around the ground, with two of the boards underneath the scoreboard making them clearly visible to everyone at the game as well as TV spectators. The boards feature our fresh new logo following the recent re-branding exercise throughout the whole business. Stephen Castleman, Partner, says, As a firm we strongly believe that it is important to get involved within our local community and we are delighted to show our support for Leicester Tigers with these smart, new advertising boards. Continued Overleaf >>> West Walk Building 110 Regent Road Leicester Le1 7lt T: F: E: info@newbyc.co.uk Eltham House 6 Forest Road Loughborough Le11 3np T: F: E: lough@newbyc.co.uk 3 Pelham Court Pelham Road Sherwood Rise Nottingham Ng5 1ap T: F: E: nottm@newbyc.co.uk

2 <<< Continued from Page One TEAMING UP WITH THE TIGERS To have the Newby Castleman name reaching such a large audience on a regular basis is fantastic. I and the other Partners are keen Tigers supporters so it s very exciting for us to see our boards up in the ground and we wish the club the very best of luck on the pitch for the rest of the season. David Clayton, Managing Director at Leicester Tigers, comments, Leicester Tigers are proud to be associated with local businesses and we hope that our relationship with Newby Castleman is a long lasting and positive one. Changes to the state pension system Recent changes to the state pension mean that those who reach pension age on or after 6 April 2010 will encounter major differences in the system. A person is entitled to claim the basic state pension on reaching state pension age provided that he or she has paid or been credited with sufficient National Insurance contributions (NICs) throughout his or her working life. People who have not paid sufficient contributions can sometimes make up a shortfall in their contributions record by paying voluntary (Class 3) NICs. Where the state pension age is reached before 6 April 2010 a man generally needs 44 qualifying years and a woman generally needs 39 qualifying years in order to qualify for a full basic state pension. However, where a person reaches state pension age after 6 April 2010, both men and women will generally need only 30 qualifying years for a full basic state pension. Also from April 2010, the current system of Home Responsibilities Protection (which protects entitlement to the basic state pension for those caring for a child or for someone who is sick or disabled by reducing the number of qualifying years needed) will be replaced by a system of weekly National Insurance credits. The state pension age is currently 65 for men and 60 for women. However, for women born on or after 6 April 1950 it will gradually be increased from 60 to 65 between 2010 and Thus, by 2020 the state pension age will be 65 for both men and women. The state pension age is to further increase from 65 to 68 between 2024 and A person can find his or her state pension age by using the state pension calculator on The Pensions Advisory Service website (see uk/state-pensions/state-pension-age-calculator). Case study Elizabeth was born on 4 June She wants to know when she will be entitled to start drawing her state pension, and how many qualifying years she will need in order to qualify for a full basic state pension. Using the pension calculator she finds out that her pension age is 61 years, one month and two days and that she will reach state pension age on 6 July As she reaches state pension age after 6 April 2010, she will need 30 qualifying years to receive the full basic state pension. She should obtain a pensions forecast from the Pension Service (tel ) to enable her to assess whether it is worth paying voluntary NICs. We can help with your financial planning needs. Please contact us for advice and assistance. - New advisory fuel rates HMRC recently withdrew the month s notice previously given ahead of new advisory fuel rates coming into force, following discussions with trade bodies. The rates are reviewed twice a year. Any changes will now take effect on 1 June and 1 December and will be published on the HMRC website shortly before the date of change. HMRC will also consider making changes if fuel prices fluctuate by 5% from the published rates. The latest advisory fuel rates, which apply from 1 December 2009, are as follows: Engine Size Petrol Diesel LPG Up to 1400cc 11p 11p 7p cc 14p 11p 8p Over 2000cc 20p 14p 12p The advisory fuel rates are accepted either for employers reimbursing employees for the cost of fuel for business mileage, or for employees reimbursing employers for the cost of fuel for private mileage. Employers are not obliged to reimburse their employees at the advisory rates, as long as any alternative rates can be justified, for example using a higher rate per mile where an employee uses a four-wheel drive vehicle in the performance of his or her duties. For further advice on business motoring, please contact us.

3 The rules governing charities What is a charity? A charity is a body set up and established for exclusively charitable purposes. In England and Wales, charitable purposes are as set out in the Charities Act 2006 and each of the charity s aims must provide a benefit to the public. This may be only a section of the public, but must not be unreasonably restricted geographically or by ability to pay any fees charged. This new public benefit requirement is a continuing duty for charity trustees throughout the life of the charity. Governance The nature of the organisation will determine the most suitable legal structure. Type of governing document Constitution or Rules Trust deed Memorandum and articles of association Charity trustees will usually be called Executive or management committee members Trustees Board, council of management or directors Advantages and limitations of being a charity Advantages to being a charity include not normally having to pay direct taxes (and there is special VAT treatment in some circumstances), paying no more than 20% of normal business rates and often finding it easier to raise funds than noncharitable bodies. Charities must not carry out any non-charitable activities, and strict rules apply to trading. Reporting All registered charities must prepare a Trustees Annual Report and accounts. The basic contents of the Report are mandatory, though the amount of information depends on the charity s size. It should explain the charity s aims and how it is going about achieving them for the public benefit. All charities must keep accounting records and prepare annual accounts which must be made available to the public on request. In England and Wales, charities whose gross income exceeds 25,000* must file the Report and accounts with the Charity Commission and also submit a completed Annual Return. Charitable companies also have to submit accounts and Annual Returns to Companies House. There are two bases on which charity accounts may be prepared: Receipts and payments basis, which may be adopted where a non-company charity has a gross annual income of 250,000 or less. It consists of an account summarising all money received and paid out by the charity and a statement giving details of its assets and liabilities at the end of the year. and explanatory notes. These accounts are required, in accountancy terms, to show a true and fair view. External scrutiny The Companies Act 2006 largely harmonises the accounting and independent examination regimes for all charities. For accounting periods starting on or after 1 April 2008 the position is as follows. Statutory thresholds Gross income not more than 25,000* Gross income between 25,000* and 500,000 Gross income over 500,000, or total assets more than 3.26 million and gross income over 250,000 (see Note) External scrutiny required No external scrutiny necessary, but trustees may choose independent examination or audit Independent examination is the minimum requirement, although trustees may still opt for audit Audit required by statute * 10,000 for accounting periods ending before 1 April ,000 for accounting periods ending before 1 April 2009 Note: for charitable companies a statutory audit is required when the total assets exceed 3.26m, regardless of the income. There is much useful information available on the website of the Charity Commission Charities in Scotland All charities operating in Scotland (including those already registered with the Charity Commission) must register with the Office of the Scottish Charity Regulator (OSCR) and are subject to full responsibilities and requirements under the Charities and Trustee Investment (Scotland) Act This includes submitting an Annual Return form, with accounts produced under the Charities Accounts (Scotland) Regulations 2006: Statutory thresholds Gross income less than 500,000 and total assets not more than 2.8 million Gross income of 500,000 or more, or total assets more than 2.8 million For more information visit External scrutiny required Independent examination by a qualified person Audit required by statute Non-company charities with gross annual income of over 250,000, and all charitable companies, must prepare their accounts on the accruals basis in accordance with the Statement of Recommended Practice Accounting and Reporting by Charities (SORP). They contain a balance sheet, a statement of financial activities (SoFA)

4 New requirements for online filing April 2010 sees the introduction of a number of changes to the way that businesses must file and pay certain taxes. The only way to file these taxes will be online and payment must be made electronically. HM Revenue and Customs (HMRC) is keen to encourage online filing of returns, and the switch to online management and electronic payment of tax comes as a result of a review of HMRC s online services. VAT returns From 1 April 2010, HMRC will begin the process of phasing out paper VAT returns. Businesses with an annual turnover of more than 100,000 (excluding VAT) will need to file returns online and make payments electronically, for accounting periods beginning on or after that date. Meanwhile, businesses with an effective VAT registration date on or after 1 April 2010 will need to have returns filed and payments made online, regardless of their turnover. The remaining VAT registered businesses may continue to file paper returns for the time being, but the situation is set to be reviewed by Penalties for failing to make an electronic return will be applied to periods ending on or after 31 March PAYE returns Almost all employers are now required to file their employer annual return online. Employers with less than 50 staff must file end of year forms online by April 2010 at the latest, and from 6 April 2011 the requirement to file in-year forms (including P45 and P46) online will also apply to these employers. Meanwhile, penalties for late payment are expected to be implemented by 6 April The system will be based on the number of defaults during a tax year, and excludes the first default. The penalties will range from 1% of the total amount for the next three defaults, to 4% of the total for 10 or more defaults. Any sums that remain unpaid after six months from the penalty date will be subject to a 5% surcharge, with a further 5% surcharge applying after 12 months. Corporation tax returns Also in the pipeline, for returns due after 31 March 2011, corporation tax returns must be filed online with accompanying accounts and computations in Extensible Business Reporting Language (XBRL), the new standard designed for business financial reporting. Payments must also be made electronically. Companies House will accept company accounts in the same format, which will apply to all company tax returns being submitted to HMRC from April You are advised to ensure that you make the appropriate arrangements in good time. We can help with all your tax planning needs, including dealing with your tax returns on your behalf please contact us for information and assistance. New look Same expertise for all your accounting needs

5 Making the best use of losses The current economic climate has claimed many casualties, and a significant number of businesses are facing losses. However, there are various ways in which losses can be utilised and the challenge is to ensure that they are used in the best possible way. This article examines possible ways of relieving a loss in an unincorporated business against income tax. Carry-back against previous profits This temporary relief was introduced to help businesses during the recession. It applies to trading losses made in 2008/09 and/or 2009/10 only. The loss can be carried back against previous trading profits of the preceding three years. If a claim is made to set off the loss against the total income of the same or previous year, then it may be possible to carry back any unused loss for up to another three years. The loss is deducted from the earlier year s profits, starting with the most recent year first. There is no limit on the amount that can be carried back to the preceding year. However, losses carried back to the previous two years are capped at 50,000 per year. This relief, while available, may be beneficial. It allows immediate repayment of tax. Further, the fact that the loss is only set against trade profits rather than total income means that if the taxpayer has other income for the years of the claim, personal allowances can be preserved. Extended carry-back is available for losses in any of the first four years of a new trade or in the final 12 months of trading. Against general income Where a person carries on a trade and makes a loss in a tax year, that loss can be deducted in calculating that person s net income for the year in which the loss was made, the previous tax year, or for both tax years. The ability to relieve losses sideways is a valuable one and, like carry-back against previous profits, allows immediate relief for a loss. Against capital gains To the extent that the loss cannot be relieved against general income in the same or the preceding year, it is possible to relieve any unused portion of the loss against capital gains. The loss is treated as if it were a capital loss, thereby enabling it to be set against any capital gains of the same tax year. Against future profits If the loss cannot be relieved in any of the above ways, it can be carried forward and set against future profits from the trade. This is usually the last resort option as the loss cannot be relieved until such time as sufficient profits are made. The aim is to obtain relief at the highest rate of tax and as early as possible. Some number crunching may be required to work out what is the best course of action. Please contact us for further assistance.

6 Time to get equal: encouraging diversity in the workplace The issue of equality in the workplace is increasingly featuring in the headlines. Despite its recent victory in a landmark age discrimination case, the Government is considering extending the default retirement age, and more people than ever are planning to work beyond 65. Furthermore, with the Equality Bill set to come into force later this year, followed by the Equal Treatment Directive in 2011, it is now more important than ever that your business adopts a positive approach to diversity. The legal position Existing equality law consists of nine separate sets of key legislation, around 100 statutory instruments and over 2,500 pages of guidance and codes of practice. The Equality Bill aims to strengthen and streamline this law, condensing the existing legislation into a single Act and integrating the separate regulations that outlaw discrimination on the grounds of race, gender, disability, age, sexual orientation, gender reassignment, and religion or belief. Some of the key employment measures outlined in the Equality Bill include: Positive action employers may select an individual from an under-represented group, where there are two or more equally suitable candidates Gender pay reports under new powers the Government could enforce reporting on the gender pay gap, by employers with 250 or more employees Age discrimination existing laws will be extended to apply to the provision of goods, facilities and services Employment tribunals recommendations can be made that benefit the whole workforce, rather than the individual who suffered the discrimination The business benefits In addition to fulfilling your legal obligations, the business benefits of taking a positive approach to diversity can be significant. Offering the same rights to all your employees, regardless of their particular background, specific issues or social group, will help you to attract a broad base of candidates with a range of skills, experience and expertise. This can be of particular importance to small businesses, which can find it difficult to recruit and retain workers with the appropriate skill sets. Offering equal opportunities to your staff, such as equal pay for men and women with similar roles, flexible working options, and equal access to training and development programmes, will also improve morale in the workplace, and make staff feel that they are valued for their contributions. For further ideas on how to achieve a culture of diversity in your workplace, consider the following suggestions. Building a culture of diversity Recruitment and selection Advertise positions in a range of different media Supply application forms in a variety of formats (eg large print) Avoid potentially discriminatory wording (eg energetic/ mature) Actively welcome applications from minority groups Offer special arrangements for applicants with disabilities Only request essential personal details, such as contact information Avoid questions that you would not ask of any candidate (eg asking a woman about childcare arrangements) KEY TIP: Your recruitment and selection process should be objective and consistent, and decisions based on the candidate s skills and experience as relevant to the position. Employment and progression Give all employees access to training Make sure that pay and bonus schemes are transparent and justifiable Provide a working environment that is safe, comfortable and accessible for all employees Make reasonable adjustments to your premises and facilities as necessary Consider offering flexible working options (eg home working, or compressed hours) Offer staff training in equality and diversity issues Have a written procedure to deal with complaints of bullying or harassment Base any redundancy decisions on the specific needs of the business KEY TIP: Your training, development and remuneration policies should be transparent, with benefits and opportunities available to all staff. By encouraging a culture of equality and diversity in the workplace, your business can reap the benefits of attracting and retaining skilled staff and improving morale and productivity, while also boosting your reputation, and helping to give your business the competitive edge. This article is intended for general guidance only. If you are unsure of your legal obligations, you should seek professional advice.

7 Childcare vouchers and salary sacrifice Despite concerns that the Chancellor would act to restrict or remove tax relief for childcare vouchers in his 2009 Pre-Budget Report, for now at least the relief remains. This means that employees can still enjoy the tax savings associated with childcare vouchers. Employees can receive childcare vouchers tax-free up to a total limit of 55 per week. The limit applies per employee rather than per child. Perhaps not surprisingly, childcare vouchers are a popular benefit and are often made available to employees under a salary sacrifice scheme. This is a win-win situation. However, for the arrangement to be effective from a tax perspective the change must be a contractual one and the employee must not be allowed to revert to the higher salary at will. As a result of swapping cash salary for childcare vouchers the employee can save both tax and national insurance (NI) contributions. The employer also saves employer (secondary) Class 1 contributions. Example Polly enters into a salary sacrifice arrangement with her employer under which she gives up cash salary of 2,860 a year in exchange for childcare vouchers of 55 per week. She is a basic rate taxpayer and pays NI at the main non contracted-out rate of 11%. Polly would have paid tax of 572 ( 20%) and NI contributions of ( 11%) on the cash salary foregone of 2,860. No tax or NI is payable on the childcare vouchers as a result of the exemption. Polly is therefore a year better off by entering into the salary sacrifice arrangement than if she had continued to receive her full cash salary and paid childcare from her net pay. As a result of the salary sacrifice arrangement her employer also saves employer NI contributions of ( 2,860 x 12.8%). As the relief is given at the employee s marginal rate of tax, a higher rate taxpayer would save tax of 1,144 ( 40%). The corresponding NI saving where contributions are payable at the additional rate of 1% would be 28.60, meaning that in total a higher rate taxpayer would be 1, better off by taking childcare vouchers under a salary sacrifice scheme than by paying equivalent childcare costs out of net pay. When entering a salary sacrifice arrangement care should be taken not to reduce cash salary to below the lower earnings for NI purposes ( 95 per week for 2009/10) as this may adversely affect entitlement to statutory payments. Also, employers should be aware that they are obliged to maintain non-cash benefits throughout a woman s maternity leave, even where provided as part of a salary sacrifice arrangement. An individual is not entitled to enter a scheme if the salary after sacrifice would fall below the National Minimum Wage level. HM Revenue & Customs (HMRC) has updated its online calculator, which helps determine whether an individual who receives tax credits would be better off overall if they were to take childcare vouchers: Salary sacrifice schemes may affect entitlement to state benefit and tax credits and so the implications of joining a scheme should be thought through carefully by individuals, before they agree to taking them up and altering their contracts of employment. We can advise on your individual circumstances; please contact us for further assistance. Life is a journey and in the course of that journey our financial needs and priorities change. From your first mortgage, to the management of your wealth in retirement, whatever your needs are now and in the future, Newby Castleman (Financial Services) Limited has the qualified and experienced people to help you to plan and prepare for the unexpected. Contact Matt Raine mor@newbyc.co.uk

8 Graduates Apply for Accountancy Roles We can reveal a healthy response again to our annual trainee scheme with over 300 applications received so far. Talented school leavers and graduates looking to break into the accountancy profession have just a short while left to apply for one of up to a maximum of five trainee positions, which begin in September. Stephen Castleman, Partner, says, We have placed a strong emphasis on employing trainees for many years now as they are the future of this profession and we are always extremely keen to continue their education in a practical sense. We are not looking to recruit staff exclusively from the accounting disciplines however a strong academic background is essential. Client service is of paramount importance to us and we seek forward thinking, enthusiastic and hard working graduates whose skills will complement those of our existing client services team. Beneficiaries of the Newby Castleman training scheme are two of last September s arrivals, Vicky Keenan (23) and Dipesh Joshi (18), who joined the firm following their academic studies at the University of Northampton and Wyggeston and Queen Elizabeth I College respectively. Both newcomers had already spent time working with us: Vicky during a placement year prior to her final year at university and Dipesh who enjoyed work experience during his Year 10 studies and has spent his subsequent summer holidays working for us. Vicky, from Leicestershire, graduated in 2008 with a BA in Financial Services before completing an MSc in Accounting and Finance and is now studying for her Association of Chartered Certified Accountants (ACCA) examinations. Choosing a career involving figures was a logical decision for me. I really benefited from my time at Newby Castleman during my placement year and was delighted to be offered a contract here following my graduation. Dipesh, who lives in Wigston and gained straight A s in his A-Levels for Maths, Further Maths and Accounting took the decision to join us rather than going to university. He is now studying for his Association of Accounting Technicians (AAT) qualification, before then embarking on his Institute of Chartered Accountants (ACA) examinations in the future. Going on to higher education was a consideration, he said, but when the chance to be a trainee arose it seemed a perfect opportunity as I am familiar with the firm and the work. Not going to Uni means I won t have any student debt and I ll have practical expertise, which is just as vital as qualifications in this competitive industry. My experience has shown that there are opportunities out there for youngsters who decide against university, but they need to be prepared to work hard and be learning all the time. Revenue publishes new Charter HMRC has published a new Charter, which sets out the responsibilities of the department and the rights of the taxpayer. Under the Charter, HMRC gives a commitment to help and support individuals, businesses and other bodies to get things right. The document also asserts that the Revenue must be professional and treat people even-handedly. Furthermore, taxpayers can expect HMRC to: tackle those who deliberately break the rules and challenge those who bend the rules; protect their information and respect their privacy; accept that someone else can represent them; and do all it can to keep the cost of dealing with HMRC as low as possible. In return, the Revenue expects individuals to be honest, respect its staff, and take care to ensure that their tax affairs are correct. The Charter can be viewed at