The tale of a worried VAT taxpayer

As I said in my previous blog I’m going to be telling you a few stories about how we’ve made a difference in people’s lives.

Lucas had ignored my advice to regularly check his VAT position so when we prepared his accounts he had sailed way over the VAT registration threshold. Since then he has had many sleepless nights trying to work out how he was going to pay this VAT. I kept talking to him though, kept him calm, got him VAT registered, a payment plan put in place with HMRC spread over 6 months and the penalty reduced by half for being helpful. He’s now in the good books with HMRC……

But I also kept telling him that actually in the long run this will help make him money; and to prove the point when I met him a few weeks ago and told him HMRC owe him £2,000 in income tax a smile spread across his face…he looked relaxed….He then told me that he was well on track to clearing the overdue VAT too, through the savings he had made following the VAT registration.

We then went on to discuss how we could put his wife through the business (for help with his administration) saving him another £1,000 in taxes each year………another smile spread across his face.

So it’s not a bad life being an accountant…….we help make people happy!

Getting focus on what you want, for a better life

Carrying on with our stories…….

Steve and Robert were fed up. They were both working long hours and making very little money. They wondered how they could get out of this trap.

I wondered if I could help them. They agreed to a business strategy review.

We spent two half days discussing where they were at the moment and ideas they had to improve things and after discussing various options and much heart searching, they agreed on a plan of action with deadlines and responsibilities.

The plans were implemented, some worked, some didn’t but within 12 months Steve and Robert had transformed their business. They had cut out their low ticket project work for local businesses and refashioned their business to concentrate on larger project work: they also increased their prices and were more selective about the clients they take on. The end result, much higher profits and less hours working; they were far more relaxed about their future and happier.

Through our uncomplicated strategic review process, Steve and Robert had got focus on a plan of action to move away from too little profit and working long hours to job satisfaction and the profits they wanted whilst working sensible hours.

For me, a very rewarding and fruitful few hours of help……

So don’t just think of us simply as your accountant. Use the years of business experience to help you and your business to greater success

The story of the strange VAT returns

A few days ago I met with a new client together with a VAT Officer to discuss the way the VAT returns were prepared by the client. Since moving to their new location they had been short of cash and although thankfully business was steadily improving, he was still short of cash every day. Every day was a battle….so the last thing he wanted was a VAT visit.

On talking through the strange figures that appeared on his VAT returns, we suddenly realised that he had been calculating the VAT on his sales incorrectly. In fact we worked out that it was possible that he had overpaid VAT by up to £20,000 over the last few years. Our client was delighted……..although there’s lots of more work to do and other implications to think through, this was a great outcome from a worrying meeting.

After meeting with the VAT Officer we then updated on things with the client and they advised that they realised that there were entitled to more on their tax credits (which I estimated to be at least £2,000pa). This was on top of the fact that we had recovered £8,000 on unclaimed tax credits in a previous year and the already £9,000 per annum new ongoing tax credits claim we had put in place for them. This had made a massive difference to keeping their business afloat.

Next we plan in the next few weeks to sit down and talk about how they can make more money though their business……..I’m sure there will be far more opportunities to help make even bigger differences there but that will be another story.

Making a big difference in people’s lives………..

Working as an accountant might be the last thing you would want to do; I’ve got one friend who says that going to see his accountant is like going to see his dentist! But what if working as an accountant and business adviser could make a difference in someone’s life……..that’s what I can achieve through my work! Opportunities happen all the time to make that difference……

For example, through:

1.    Reducing someone’s tax bill or generating more tax credits,

2.    Giving peace of mind to a business owner who is worried about meeting the various compliance deadlines for accounts and tax returns, avoiding the risk of penalties,

3.    Simply saving business owners time letting them concentrate on doing what they’re best at, running their business, and

4.    Best of all helping business owners to understand their business better whether through historical financial or non-financial numbers (such as key performance indicators) or forward looking forecasts, business plans and strategies. Through this we give control and focus, in turn re-energizing the business team to achieve the future they want, whether it’s business growth, more profit or achieving personal goals

It’s a privilege to be working with our clients and very rewarding! Ok sometimes it can be a bit of a reality check when we tell you something you didn’t want to know but involve us in your business and see how we can make that big difference…….

So over the next few weeks and months, I’m going to tell you a few stories of how we have helped make a difference in client’s lives…

A profit improvement exercise can involve spending more money but still improve the bottom line!

When you think of profit improvement and accountants do you automatically think cost cutting?! Of marketing, training and staff – in fact anything of any long term value?

Well that’s understandable – in my previous incarnation as a Finance Director I had to play the grim reaper a few times.

In my first job as a FD we had a major “profit improvement exercise” – yes, we cut staff numbers and also other costs – we indeed slashed marketing! It was a mail order business and at the time we were losing lots of money; in fact, we learned later that if the exercise wasn’t successful we were going to be closed. For mail order now read eCommerce. It was our catalogue mailing order segments that simply weren’t performing…..by carefully targeting profitable segments only we saved huge amounts of money. In contrast we instead invested in a policy of sending out orders part complete and the rest of the order when we had it in stock. Previously we waited until the whole order was in stock and therefore “complete” before despatching the order. Our postage costs went up but so did our customer satisfaction and our profit – lower turnover/higher profits!

The business quickly went on to make a lot of money in the next few years.

In Sanders Geeson’s profit improvement exercises we not only look at overheads we also look at customer retention, getting more from each customer, getting more from your marketing, maximising production efficiency, managing your stock and debtors and buying better! And we help prioritise the important initiatives.

At Sanders Geeson we can help you come up with an action plan for saving you money and building your business!

Contact Jan on 07890 239442, jan@sandersgeeson.co.uk

Believe in Sustainability and improve your profits!

Like all accountants I believed that following a policy of looking after the environment and implementing “Sustainability” in a business, meant fluffy PR communications and lower profits! However I’ve seen the “light” and now see that having a sustainability agenda can mean real gains for your business in two ways:

1. Saving costs, and
2. Improving your top line sales too

How can this be achieved?

¨      The place to start is a review of all your energy and carbon consumption through an energy and carbon audit. This forms a baseline from which to identify improvements which you can make. Areas to look at include energy and water usage, IT hardware, printing and stationery costs, motor expenses and of course, material and consumable usage.

¨      What is your long term strategy? Does it include Sustainability as a key ingredient? Plan to make Sustainability a key goal in your business embraced by the senior team and make it part of your strategic growth plan

¨      Look at the way you do things: is there waste and inefficiency in your internal processes which is contributing to increased use of physical resources?

¨      Involve your team: tell them your ideas, and they will not only help to generate new ideas but also enthusiastically implement your plans, in turn helping to boost your business morale

¨      Communicate the message to your customers and other stakeholders in your business: spread the message and grow your business

¨      Measure your success: periodically review where you are compared to your initial audit

We can help you come up with a sustainability action plan for saving you money, building your business and in turn helping the environment!

Contact Jan on 07890 239442, jan@sandersgeeson.co.uk

How to improve your profits in 12 easy steps?

Improving profits successfully is a process. It needs a plan. And it’s not just simply about cutting costs but more importantly about your building your business for the future. Here is our 12 step plan:

1.      Do you know your plans for the next 3 years? Are they written down?

2.      Do you know where you are right now? What is your current performance? Do you know your key numbers?

3.      What plans do you have to retain the customers you want?

4.      Have you reviewed the effectiveness of your marketing?

5.      What plans have you got to gain new customers and improve conversion rates?

6.      How can you improve customer spend?

7.      Where there is perceived value in the eyes of your customer how can you optimise your prices?

8.      How can you maximise production efficiency?

9.      How can you manage your financial assets more effectively including stocks & work in progress and debtors?

10.   How can you manage your purchasing more effectively?

11.  Is your cost management as good as you would want?

12.  After costing and prioritising which profit improvement actions are going to be the most effective, pull it all together to produce an action plan and profit targets over the next couple of years, which can be followed up on a regular basis

Working with us through our profit improvement session, we’ll take you through these 12 steps helping you to improved and sustained profitability.

Want to know more?  Contact Jan on 07890 239442, jan@sandersgeeson.co.uk