Update on my business and increase in charity audit threshold

Well, this is my first blog post in some time. I have now been in business for a little over three years and am enjoying the challenge and flexibility that self employments brings. I am fortunate to be able to work with a broad range of charities and social enterprises that perform a wide variety of important work. Recently I have obtained some work with a number of organisations helping them with their systems and procedures including the training of accounts staff. This is work that I enjoy doing and is different from the year end accounts preparation which forms a significant part of my work. If you think I can help your organisation then please drop me an e-mail.

Other news is that the audit threshold for charities is due to be increased, from annual income of £500,000 to £1,000,000 (although the exact rules are not quite as simple as this). The change is due to apply for financial year ends from 31 March 2015 and should to be announced any day. This could lift the regulatory burden for some 4000 charities nationally. This also means that I will be able to perform independent examinations with a larger range of charities. I am looking for more work doing independent examinations of charities and would be happy to discuss this if you are considering changing independent examiners.

This link explains about the increase in audit threshold.


General update and some information about RTI and Gift Aid…

Well, this is my first blog post for some time… I have been in business for a little over a year now and I must say that I’m really enjoying the challenge and experience of working for myself. This is not to say that there are no difficulties but so far the rewards and independence easily outweigh the downsides.

I have picked up some new clients which is exciting, both in Manchester (including Salford) and Leeds. I am also enjoying working with longstanding clients who I have built up close working relationships with over a number of years. I am still looking for new clients, so if you know of any organisation that you think I could help then I am interested to hear.

I am about to send an e-mail to existing clients highlighting the forthcoming changes in payroll (real time information or RTI) from 6 April this year. Help and guidance is available on HMRC’s website to help with this change. For organisations that use payroll software or oursource the payroll function, this should not present too much of a challenge but I would advise any employer to read the guidance and ensure that they ready for this change.

In addition, from 23rd April, charities and community amateur sports clubs will be able to claim gift aid on-line, information about this change can be found here.

That is all for now, do send me an e-mail contact@pcowhamaccounts.com if you want to get in touch and I will reply promptly.

Thanks for reading!


cap on charitable giving?

Well, I don’t intend for this blog to get political, but I would like to draw your attention to this website which discusses the government’s proposed cap on tax tax relief for charitable giving. These proposals would appear to be inconsistent with any notion of a “Big Society”.

As an accountant specialising with charities and social enterprises, it did annoy me to see reports in the media that wealthy individuals can magically reduce their tax bill by giving to charity. It is true that if an individual donates to charity that they pay less tax. For example,  if an individual who pays tax at the basic rate (20%) donates say £80, the the tax which has been paid by the individual on this donation which is £20 can be claimed by the charity from the government.

To try and explain this in a different way, if an individual earns £100 and pays tax at 20%  then £20 tax is paid, leaving them with £80.

The individual pays the £80 to a charity, the charity can then claim £20 off the government, the net result being that the charity receives all the £100 earnt by the individial. The individual looses £80, the government looses £20 and the charity gains £100.

Hopefully this simple example helps to demonstrate that giving to charity is not a way of cheating the system and does not benefit the individual financially when done correctly.

There may be a small number of bogus charities established by wealthy individuals who donate large sums of money to the charity which then uses  the money donated (and the tax claimed from the government) in the interests of the individual. This is clearly illegal and  if this does occur should be stopped.