We have helpful finance management advice on debt, loans and credit cards

With the subject of IR35 feeling like a grey area for most contractors, it is recommended that any contractors unsure of their IR35 status seek expert advice from either an accountant or most of the time recruiters will also be able to advise you on this topic, however it depends how uncertain you feel about your IR35 status.

To avoid your contract and working practices falling inside IR35 legislation, you will need to clearly show that the way you are working is that of a self employed contractor. HM Revenue and Customs clearly define what in their eyes classes as ‘passing IR35’; visit their website for more information, but as ever it is worth speaking to a specialist contractor accountant who will be able to simplify things for you and discuss this topic further.

Some contractor accountants also offer free verbal IR35 contract reviews which is quite handy. You can also ask for a full written formal review with a report outlining areas of weakness; however nobody can guarantee or insure you against IR35. You can buy IR35 insurance which will cover the accountancy and legal costs to defend your case but nobody guarantee you’ll be inside as it’s based on what HMRC decide.

You can fall inside IR35 legislations and still work as a contractor through your own Limited company there are still tax gains to be had working this way, and you will only pay tax on roughly 95% if your tax able income rather than the full 100%. Again talking to a specialist accountant means they will be able to advise you on your current contracting situation and advise you on the best way to contract which will maximise your take home pay.

IR35 is in essence quite simple but just having a cleverly written contract isn’t enough, you need to also make sure your working practices reflect your contract.

“Small businesses are particularly vulnerable as they often don’t have the systems in place to protect themselves or the resources to draw on if they do become a victim. With identity theft on the increase, it is essential for SMEs to recognise the potential threat and take steps to ensure their business is protected. If they do suspect they have become a victim they should inform their bank or local police.”

- Danny Harrison, CPP Identity Fraud Expert.
Within the last year, 15000 businesses have claimed to have fallen victim to corporate identity fraud – showing a remarkable rise in crimes against SMEs. Within this article, the most common form of corporate identity fraud is explained – and ways of preventing it.
Companies House
SMEs are easily susceptible to fraud through criminals taking advantage of a small loophole within Companies House. Fraudsters can change the address of any business by submitting a false AD01 address, so they can apply for a company credit card or order fraudulent goods on the company account. This can be done without anyone noticing due to Companies House not alerting the company director or secretary that there has been a change of address. SMEs believe that corporate identity fraud is normally committed by previous employees of the business, working directly – or through an associate of theirs.
The majority (68 per cent) of SMEs are unfortunately unaware of this loophole, mistakenly believing that Companies House checks and verifies the details of documents filed with them. A recent survey of two hundred small and medium SMEs revealed that, through a combination of ignorance and lack of information given to them, 87 per cent did not have the adequate insurance in place – leaving them wide open to corporate identity fraud.

Protecting your Business

Companies House does offer some basic protection in the form of the ‘Protected Online Filing System’ (PROOF) scheme. The added security which PROOF provides is a way to stop the fraudulent change of the registered office address and change of director or company secretary, helping to reduce the risk of corporate identity fraud. However, there are other precautions which must be taken to fully protect your business against fraud.

CPP’s top tips on protecting companies from corporate identify fraud:
 Limit access to company sensitive information to only key employees
 Make sure all company sensitive information is securely stored and only transferred using passwords and encryption in case it is lost or delivered to the wrong recipient
 Ensure that company staff are not able to remove sensitive documents from the office
 At Companies House file information online (WebFiling), submit all papers online (PROOF) and subscribe to an alert system that notifies companies when changes to their details are made (Monitor). More information about these services and combating identity fraud can be found at www.companieshouse.gov.uk

I have worked in the same company as my partner for a number of years. In fact we have both worked there for longer. However we only started dating after a number of years and yes, I should have made a move earlier but I didn’t. Nor did she, so we are equally to blame for not starting the rest of our lives earlier. Still, as they say, you can’t change the past so I’m not going to beat myself up too much; suffice to say, I wish I had. Society would describe me as a professional, like my partner and we live a pretty comfortable life with a number of holidays and have savings to fall back upon should the need arise. Financially I have always tried to keep a tight ship and regularly review my spending, keeping abreast of any new savings policies that have been released, trying to utilise my tax free allowance that the chancellor allows in the budget. I have spoken to both my parents and my partner’s parents about possible inheritance tax liabilities and the best ways of mitigating any potential liabilities there are, given the increased likelihood of their deaths before ours. However, where I feel I do make most of an impact on things is to keep an eye on where we have arrangements for our regular outgoings. Clearly our major outgoing is our joint mortgage and fortunately we have a tracker mortgage which has allowed us to enjoy relatively low monthly payments for some years now. I also keep an eye on the comparison websites such as life insurance compare to check on the cost of gas and electricity providers and telephone and broadband providers.

Source: http://www.lifeinsurancecompare.uk.com/blog/2011/12/09/i-use-life-insurance-compare-website-see-if-im-paying-too-much/

Like most people I find balancing the household finances at the end of the month a struggle. With three children all under eight and me not in full time work we need to watch every penny and I have become adept at making the money last and would be described by the popular press as a “Thrifty Mum”. I am probably not alone when I’m not only able to list all of my direct debits but also able to say the amounts I pay each week for each of them and the day they come out of our bank account. The control this gives me allows me to avoid worrying too much as I couldn’t cope with the thought of not being able to do so and the crisis I would be in would threaten everything I and my husband have worked together for. I have become very canny at looking out for offers and religiously cut vouchers out of the newspaper and keep an eye out for when the deals are on at the local Tesco supermarket. One of the most helpful ways of saving money I’ve come across in recent years is to use the comparison websites to make sure that you aren’t paying a penny more than you have to on your household bills. I used the mortgage protection quotes website and saved a fortune. I also checked to see if our buildings and contents insurance can be bought cheaper than we have it already. Changing electricity and gas suppliers is always worth considering as they tend to put up prices for people who don’t switch providers like the banks and building societies do for those who don’t move their money to the best savings accounts. I believe that we can save about one month’s salary a year by switching or threatening to switch suppliers. Sometime purely mentioning the fact that you are about to change provider to your existing provider will mean that they will drop their price by a huge margin. Its well worth trying, the alternative is too awful to contemplate.

Source: http://mortgageprotectionquotes.org/blog/2011/12/08/i-found-i-was-paying-too-much-my-life-insurance-when-i-made-online-comparison-using-mortgage-protection-quotes-website/

Most of us expect to live a secured life, yet few of us do. Secured credit cards with 0 interest can offer us a measure of security we need. Secured cards are available on the Web. Banks often promote cards for those with excellent credit scores, but everyone can get a credit card.

Those with poor credit scores may have to pay a deposit on the credit cards with 0 interest. Once the cardholder pays a deposit, his or her card becomes a credit line. These days lenders usually focus on the people whose credit is less than perfect because millions of people are in debt. Lenders know that those in debt need to reestablish their credit. Similarly, some people have no credit history. Credit cards can provide people with ways to establish a credit history by allowing you to make payments on time. Read the rest of this entry »

I’m keen to find out whether the coalition government may decide to make changes to Trusts or Business Property Relief in the near future, as it would effect my inheritance tax planning.

I have been working with a consultant from Inheritance Planning Review and we’ve got a strategy in place which would look to mitigate my liability considerably. However I have heard that the government may be reviewing the current rules regarding Chargeable Lifetime Transfers and Discretionary Trusts, and therefore do not want to put something in place which may not be suitable for our circumstances. There was also an article which said that Enterprise Investment Schemes which qualify for Business Property Relief, and therefore means the investment is considered outside your estate for inheritance tax purposes after 2 years, may also be reviewed by the government. It seems that they’re not happy with people using these plans in a low risk manner with the prime objective being to avoid paying tax.

I’m not sure if there is any truth in these rumours but if anyone has any opinion or information on this then I’d be grateful.

Running my own reprographics business has been a roller coaster since I set the business up some three years ago having been made redundant by my previous company after having worked there for a number of years. I had worked there since leaving college and picked the business up well enough that I began to feel that I had outgrown the company by the end, so the news that I was being let go was something of a relief. To move from where I was then to the situation I find myself in now has been a journey not without problems, but more of a journey of self discovery. I have always been relatively conservative in my spending habits but since the advent of price comparison websites it has made the job of being financially astute completely accessible to everyone. I am able to organise my finances from my home computer to arrange loans, pay wages and bills and permanent health cover and transfer entire documents to clients at the click of a mouse. The accessibility of these comparison sites on the internet has meant that the man or woman in the street can check the prices of what they are paying against the prices they should be paying.

An Individual Voluntary Agreement, or IVA, is an attractive alternative to bankruptcy but there are a series of qualification criteria for applying to enter an IVA. To qualify for an IVA:

• The debtor’s unsecured debts must equal a minimum £15,000. In certain instances, an IVA may be approved for a sum of less than this, but only with a reduced fee for the account handler.
• IVA proceedings do not include Mortgages, secured loans and Hire Purchase debts.
• IVA proceedings include unsecured loans, credit cards and store cards, catalogues and overdrafts, as well as tax and VAT for the self employed.
• The debtor should not own material assets which could pay off their debt. Material assets such as equity release on a property or trading an expensive car should be considered before an IVA.
• There is no legal minimum number of creditors who need to be owed for an IVA to be approved but generally IVA firms prefer cases with more than one creditor involved as it gives them more opportunities to get the IVA approved.
• Debtors are required to be in employment for an IVA to be approved, except for exceptional circumstances. If the debtor is receiving long term sickness benefits or has a partner in employment to support the IVA application then creditors may accept it.
• A debtor’s IVA application is unlikely to be accepted without the right type of creditors. There are number of aggressive creditors who will refuse an IVA, regardless of the situation.

My mother has just passed away so needless to say things are a bit bad at the moment. The family and I were trying to find where she kept her personal papers and we were surprised to find that she had a life assurance policy. I know she had always remarked about the importance of life assurance and by comparison her own twin sister had died a pauper. We found it almost impossible to make contact with the insurer who gave little if any kind of procedure to make a claim. Apparently she could have put the insurance cover in her children’s names so there wouldn’t have been so much bother. My own daughter is currently buying her first property and has managed to find a life assurance comparison site which offers a whole of market service. I think I’ll check with her and see if I need to do something as well, It can be a nightmare for those left behind to sort it out.

A new menu-based online Life Assurance plan has been set up by ProProtect. To reduce costs, some features of the PruProtect plan are not available with the essentials plan.

To help you in conducting a life assurance comparison exercise, the essentials plan comprises core serious illness cover and level, decreasing or index-linked life cover, unemployment cover and income protection.

These include automatic child serious-illness cover, a guaranteed insurability option for life cover, serious-illness cover and disability cover, optional serious-illness cover for children and immediate cover. However, policyholders can upgrade to the full PruProtect cover at any time.

The essentials plan takes the same severity-based approach to cover as the PruProtect plan so that people are covered for serious illnesses and partial disabilities, not just critical conditions.

The severity-based nature of the plan means that policyholders may get a percentage of the benefit rather than the full cost. This means that payments can be made at an earlier stage of the illness, even if it is not life-threatening.

Essentials provides a great deal of flexibility in that policy holders have a choice on many aspects of their cover such as guaranteed or reviewable premiums, single or joint life, whole life or fixed term and waiver of premium on death, serious illness or capacity.

However, the products could seem complicated due to its flexibility and wide range of options.