When I was a college student, I got an ‘A’ in my Accounting 101 and 201 classes. Then I entered the “real” world and almost SUNK the family business because I had no idea what I was doing with the “real” accounting. You see, the examples in the college text book used financials that were correct. That means, the dollar amounts in the accounts could be trusted, and were assumed current and accurate.

The “Real” World…

Well, when I took a swing at entering my accounting data I made a big “Slinky knot” mess out of my Peachtree accounting file. Ooops. I didn’t learn how to FIX my accounting in college. That would have been useful! I learned what I know from falling in holes and climbing out of them.

As a business consultant, I see lots of financial reports. Most of them have a few “Slinky knots” in them…accounts that are just wrong. The data in those accounts are the result of mistakes in data entry. In my consulting work, I start by helping my clients get to KFP – a KNOWN Financial Position. Let’s get the accounting correct. That’s the first step. From there, we can see the impact of operational, marketing and sales behaviors. The good news is that you can always improve your financial situation once you know what it is. I am kind of like Super Nanny. I show up, we work together to clean up the accounting and we put simple systems, routines in place to help you stay at a KFP.

Sometimes, we clean stuff up and then it gets messy again. Just like Super Nanny, I go away after my consulting visit. It is up to my clients to maintain the systems we put in place. I can always come back and I often help over the phone. However, the key to staying at KFP is your willingness to learn enough about the accounting systems to enter data properly and to fix things when they get balled up.

If you are the owner of a very small shop, you might be the Financial Manager of your company (as well as the Service Manager and Marketing Manager and Salesperson, etc.) That’s the way it goes. If you dream of being a bigger shop, take heart that every big company was once just your size. The way out…is through. Take responsibility and do a good job as the Financial Manager. Quit looking for a magical solution (accounting fairy?) who will handle the accounting for you. Learn how to do it yourself and document your basic procedures. This will help you hand off the accounting duties successfully.

In larger shops, sometimes the accounting duties get handed to…

• The Financial Manager

• The Office Manager

• The owner’s wife, mom, daughter (other relative)

• The Bookkeeper

• The Secretary

• The “Girl in the Office”

Whatever YOUR title, if you are the one who is responsible for the financial information at your company, I am here to help you. The following are a few tips and tricks for finding and fixing the “Slinky knot” messes in your accounting program.

Financial Fix Tips and Tricks…

• It’s probably YOU. I often hear something along these lines, “That number wasn’t there yesterday. It must be a QuickBooks problem.” That weird dollar amount in your financial reports probably has a very simple explanation. Somebody, maybe you, entered that information. In every accounting software program, there are debits and credits. Sometimes the debits and credits are not visible from the data entry screen. You will have to do some digging. Follow the flow of information from the entry point to the Income Statement (aka Profit & Loss or P&L) and/or Balance Sheet. (In my lengthy career, there have been only 2 cases where the accounting program was corrupt. Chances are…YOU are the problem. J Start trouble-shooting from that assumption.)

• Stay current with your financial reporting. I recommend a WEEKLY review of the Balance Sheet and Income Statement. Some contractors I know get daily reports. That’s great! Once a year at tax time is just not going to cut it. Get to KFP and run the financial reports at least once a week. It is so much easier to find and fix a mistake that happened in the last few days than trying to track down something goofy from six months ago. Also, you can fix the mistake in the current month. That is better than having to re-open a previous month and adjust it. Once I “close” a month, I don’t like to open it again.

• Go line by line down the Balance Sheet and Income Statement and look for “weird” things. If you are just getting started with this process, I can help. Or, your accountant may help you learn what’s “weird” and what’s right. What a great opportunity for him or her to add value to your relationship. KFP means that every account is RIGHT. It reflects what you have in Assets, what you owe in Liabilities and what you own in Equity. The Sales account should equal what you have sold for that period of time. The Expenses should reflect what you have expensed for that period of time. The financial reports should be current and true. Here’s a list of “weird” things that may need some fixing…

o A dollar amount that is positive when it was negative last time (or vice versa.)

o A negative Asset. (Unless it is Accumulated Depreciation or Amortization. Those numbers are “contra” accounts and serve to reduce the value of the associated assets.)

o A negative Liability.

§ Pay particular attention to your Payroll liabilities. I recommend using a Payroll service like ADP or Paychex. The number one reason: The service handles the liability so you don’t have to. The service will tell you what the cash requirements are to pay your team and Uncle Sam. They will do the tax payments for you. The Journal Entry to enter Payroll is much easier if you don’t have to keep track of the appropriate liabilities and payments. I attached a sample JE for entering Payroll. Follow the flow of debits and credits. You could create a sample transaction for your Payroll procedure and reference it every time you enter Payroll.

o A negative Sales account (unless it is the Customer Refunds or Discounts…contra accounts.)

o A negative Expense account. Now, an account may look weird but be right. For instance, if you enter a rebate for your Insurance it will show up as a negative expense for that month. Drill down and make sure.

o An account that is very different from last week or last month. If all of a sudden your Advertising expense went from about ,500 per month to 0,000 this month, drill down. Something may have been miscoded.

o Have your accountant help you make the weird things right with an appropriate Journal Entry or reversing entry.

o Find out how it got weird, if you can, and update the data entry procedure. Written procedures are KEY to staying at KFP.

o If you don’t know how it got weird, at least get it to right. If it is a small dollar amount, create an adjusting entry and watch to make sure it doesn’t get weird again. If it does…look through the previous week’s transactions for that account to find the entry. This is forensic accounting!

o If you do this once a week, YOU will get intimately familiar with the accounts and the dollar amounts. You will become an expert in what looks right and what looks “weird” and how to fix the weird stuff.

• Run a transaction register report and look for the debits and credits. Different accounting programs call this report by different names. Look for the detail trial balance or the General Ledger journal to find the “guts” of every transaction. Double entry accounting is based on the universal law of “what goes around comes around.” If something goes up, something else goes up or goes down by that amount. Debits and credits are the mechanics in the accounting system that cause the dollar amounts to go up and down…and the Balance Sheet to stay in balance. There are debits and credits behind every data entry screen. You can also affect accounts directly by creating a Journal Entry. I attached a “cheat sheet” of Debit and Credit rules. I reference this several times a week.

• Look for before-and-after differences. If you are not sure of what is happening at a particular data entry point, try this:

o Run the Balance Sheet and Income Statement.

o Enter ONE transaction. Run the Balance Sheet and Income Statement again and see if you can see where the dollar amounts ended up. (Make sure no one else is in the accounting system while you do this.)

o This is a street smart way to discover the “set up” behind the data entry screen.

• To recode, delete or reverse a transaction? It depends on your accounting program. With a basic off-the-shelf program like QuickBooks, MYOB or Peachtree, you can drill down to the transaction that needs to be fixed and recode it. Or, you can delete the transaction entirely and try again. With a more sophisticated industry-specific program like Successware, Ergos, etc. you may have to enter a transaction that reverses your original transaction and then re-enter the transaction properly.

• Be careful with your initial company set up. That’s where a lot of the behind the scenes accounting is created. If you are entering Service Sales and the dollar amount is showing up as Service Agreement Sales there may be an “item” or other set up instruction that is sending the information to the wrong sales account. Go to Company Set Up or the Items list and do some investigating. Figure out the default debits and credits and which accounts are affected. Update the “set up” and see if that fixes the problem.

• Get bossy with your software support team. Call for help as you need it. If you don’t understand what they are telling you to do, ask again for a clearer explanation. If they want to fix something for you, sit in as they do the correction so you can “follow the flow” of the debits and credits and learn from the experience. The more you know about your particular accounting software the less intimidated you will be by the accounting processes.

• Be assertive with your CPA or tax preparer. At the end of each quarter, take the time to make sure that your financials agree with the financial information your CPA is sending to Uncle Sam. Work together to enter the year-end Journal Entries needed to bring your accounting system up to accurate.

• Learn to trust your intuition. As your understanding of double entry accounting increases, trust your gut feeling that a dollar amount is wrong or “weird.” So often, I help someone fix a “Slinky knot” and they respond, “I thought that might be the problem!” If you have that thought, follow it and see what you uncover.

If it is your responsibility to get the financial “Slinky knot” untangled, take a deep breath and know this: You can do it. You may need some help. Contact me if you feel overwhelmed and we’ll set up a time to visit on the phone. This accounting stuff is just not that hard once you learn the lingo and accounting basics. One of the smartest Financial Managers I know is working with an 8th grade education.

Once you get a handle on them, you can delegate the accounting tasks. It is a blessing to have done the accounting yourself because you will never be held hostage by your bookkeeper (or “girl in the office.”) You can coach someone to be even better than you were at the basic accounting tasks. And you will understand the Balance Sheet and Income Statement so much better for the experience.

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This is where your CRM users need motivation. Let’s face the fact; data entry is a boring task and it just turns people off. Now, how to motivate your salespeople and other staff who daily use your CRM application? I’ll share some 3 easy tips that I got from a website about motivation training.

1. Carrot and Stick Motivation

This is a very basic motivation tip that we often overlook and thus forget. One of our clients applies light punishment on his salespeople if they do not input the data of their new leads or activities.

As return, if the company gets a new potential, it will be routed only to the most active salesperson in using the CRM software. It works and the salespeople are positively competing each other to be the most active user in purpose of winning new potentials of the company.

2. What You Sow is What You Ripe

What usually drives most salespeople? Yes, commission. So you just need to tell them words like this: “Dear sales reps, I calculate your commission based on the closing data provided by our CRM software. So, if you guys are lazy using it, I’m afraid the commission will be miscalculated as the consequence, and all you got is just miscalculated commission…”

This can be applied too to the customer service users. You may say like this: “We cannot measure your performance if you don’t input every complaint you receive into the CRM system. If you want to be promoted, please help us by filling out the fields completely so we can measure your KPI to justify your job promotion…”

3. You Are The Real Sales Professional of Tomorrow

Most of salespeople refuse to use the Sales Force Management software (Sales Force Automation) because they are “proud” of themselves as busy people meeting the customers. For them, CRM is only for administration staff. They are too busy to deal with such thing.

Well, tell them that sales superstars now are familiar with IT stuff, no exception is CRM software. They bring their Black Berry everywhere so they can easily access their mobile SFA, or stay for a while at a cafe to access it from their laptop. This is the new sign of today’s sales professionals. This goona make them proud of this new perspective.

Well, I hope these three simple but practical tips can help you motivate your CRM users to be more involved. Remember, most of CRM failures are due to low user adoption.

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There are restrictions when it comes to getting leads from conventional marketing approaches like web analytics or email marketing. This is where lead management crms work to bring in continuous influx of leads for the organization. Not only do these solutions providing reporting capabilities but they also facilitate business automation of leads to enable sales teams to concentrate on targeted interested leads. If you intend to buy one of these lead management crms, make sure to consider these factors beforehand.

Hidden Consultants

Most organizations looking for lead management systems want something, which enables them to implement lead management easily and quickly. Most solutions available these days do not live up to claims they make and instead it is the providers who end up acting as consultants. This can add to the service costs manifold and sometimes can be three times the purchase price. Therefore, before you go ahead and buy that lead management system, be sure that this is something your team can use daily and, which is easy in terms of implementation. Check with the company as to the percentage revenues of consulting as opposed to software because if the organization receives as much as 20% income from consulting, you might end up contributing to it!

Easy To Use

Many of the modern lead generation crms can be tough in usage and too tedious in functionality. Once implemented, these become useless because no one in the team is able to understand the working. Ensuring that the crm system is easy in terms of usability will result in expedite its adoption within the team. It will also ensure that the customer relationship management software is used as per full potential. The interface must be intuitive and easy for usage.

Trial Before Purchase

Most lead generation crms come with the option of testing or trying them out before you actually go ahead and buy them. Thus, you should leverage this opportunity to the fullest. Implement marketing campaigns to check if the crm system functions as per claims. Find if the customer relationship software serves the purpose of the team, if it is easy in usage etc. With free trials, you can gauge if the solution is perfect for you. If there is no free trial included, perform your checks thoroughly and see to it that there are no hidden charges.

Implementation And Training Expenses

While many lead management crm systems can appear to be the ideal solution, they might actually require additional effort or costs for training the team. If the solution is difficult in usage, you might need a couple of weeks to implement or customize the crm solution as per your requirements. If the training expenses have not been added onto the crm software price, check how much additional training will cost you. This way, you can allocate appropriate funds towards this aspect.

Excellent Customer Service

As with any crm software, there will be glitches regarding usage, implementation, training etc. Therefore, always select a reputed crm business provider, which has excellent levels of customer service. It should be a collaborative partnership where the provider is there for you each step of the way, even after signage of the contract.

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If you are responsible for customer service, either in your own business or within a company, you will realize good customer relationship management (CRM) can never be good enough for some capricious people. The competitiveness within the service industry is fierce and if satisfaction is not received people can, and do, very easily take their business elsewhere.

The obvious place to start identifying problem areas and sectors that need improvement, is by asking your existing customers. Setting up and maintaining good customer relationships takes commitment and can be a quit some work. There are ways to make this easier. For example a simple questionnaire can highlight issues that might never have occurred to you. If you work at a customer care department and there is a special complaints department, analyze all the information gathered by your colleagues and implement new procedures or changes there where needed. Some of these criticisms may be very simple to fix but might have a major impact on your customers. Customers like to be listened to.

Customer care is extremely important in any business since holding onto existing consumers is considerably easier and cheaper than attracting new ones. Marketing can be a costly business and one of the most cost effective marketing strategies is customer loyalty. Happy customers will keep returning and even help you in advertising by referring your business to friend’s or colleagues. This type of loyalty can only be attained by providing excellent customer service every time. Typically, people who have a poor service experience will gladly tell everyone about it, whilst in comparison people who receive excellent service only tell a few. Bad service makes a far more interesting story!

Customer service is relative because the experience one customer may be entirely happy with could frustrate and dissatisfy another. Because of this, try where possible, to be flexible within company procedures and in your handling of the customers by treating each one as an individual, not as one of the others. Take each situation, either positive or negative, as it comes along and deal with it the best you can.

In business it pays to always make yourself available and reachable to customers and treat them politely and efficiently. Personalize your service by introducing yourself, have your staff wear name tags and use customer names. It also helps with customer complaints if one member of staff is allocated a particular complaint until it has been dealt with, this way people don’t feel as if they are being passed around the company.

A successful CRM strategy involves a combination of a human approach and high tech software. CRM programs will only lead to malfunction if restricted to software installation only, there also has to be adequate training and motivation for the employees to become skilled at and have their input.

Australia has a few CRM companies who are at the same time consulting companies, providing current CRM software solutions to allow businesses to manage customers efficiently. A few of these companies designed their won software which are designed to retain existing customers, bring new ones in and get more value from both. Consultants are experienced in setting up CRM packages and first-rate CRM software solution implementation know-how. Look out for CRM companies who offer Oracle Siebel CRM software solutions which range from simple contact management to sales strength, service and marketing automation, to venture wide CRM packages.

Updating your customer relationship management style will allow you to accommodate continually shifting marketing trends. Information can be shared within the company and with other businesses, which will ultimately lead to more customers and sales. In any business first impressions are the most important, so invest in a CRM package and make your first impression count.

Manufacturing companies looking for new MRP or ERP software must understand the importance of being aware of the overall impact that the new software will have on the overall business. New practices, procedures, and processes may need to be implemented, and these kind of things need to be considered to make the software selection successful.

Granted, most software solutions will provide the same basic features, usability, tracking, and son on. However, there are some key factors that need to be considered and that different software packages will have varying degrees of functionality, user-friendliness, and so on. Only by thoroughly investigating these factors will a company be able to know that they are making the right decision.

Generally, companies seek new software because they believe that it will help them streamline and/or automate key processes, allowing them to save both time and money. However, companies must be cautious because this process of streamlining can actually be too straightforward and rigid in certain software packages. As a result, procedures that the company currently uses may need to be redesigned to accomodate the rigid software. This is not necessarily a bad thing, as often it can be beneficial to update processes and process redesigns are often not considered unless they absoltely need to be (such as when new software will be implemented). Unfortunately, some companies operate under the idea of “If it isn’t broken, don’t fix it.” However, the degree to which processes must be changed to accomodate new software must be considered because if they are too extreme, employees can become bogged down and the benefits sought by the new software may not be realized.

It goes without saying that this kind of evaluation can be time consuming. However, if it is not done, the time spent trying to gain compatibility between incompatible software and company procedures, as well as the time and money spent searching for new software when it is finally realized that the new software won’t work, will be hugely frustrating and costly.

Moving on, companies seeking new manufacturing software need to ensure that they solicit input from numerous members of the company before making a decision. This can be difficult to do as the organization still has a business to run while they seek new software, and this process can also become frustrating. Employees may be difficult to get input from as they will still be busy with their everyday duties, but it is essential that the time and effort are given to get their input as they are the ones that will ultimately be using the new system.

Likewise, upper management must be invested and supportive of the software selection process and be aware that the process will take some time. If they become impatient, the company runs the risk of selecting software that is subpar. Conversely, if upper management fully supports the individual or team responsible for selecting new software, the company will be much more likely to arrive at the optimal solution.

It can be equally frustrating choosing the right vendor or supplier of the manufacturing software that your company wants. The amount of training and on-going support must be evaluated for each vendor but the software selection team. Although this can be extremely time consuming, it is completely worth it. Taking the time to do research up front will save time and headaches in the long run if your company is always able to get the answers they need from the vendor in a timely manner. Otherwise, you run the risk of losing productivity while trying to troubleshoot on your own.

Evaluating a vendor should be done as objectively as possible. All vendors will have experiences salespeople that will do everything in their power to convince you that their services are the best. Therefore, it is imperative that a set of criteria for evaluating a vendor is identified before speaking with any vendors.

There is an old saying along the lines of “don’t put the cart before the horse.” This is extremely applicable when it comes to selecting new manufacturing software. Often it can seem impossible to determine if you should look for software that fits the business or look for ways to change the business to work with a new system.

In general, it is usually easier to study existing procedures during the selection process. Companies that try to redesign processes before considering new software run the risk of changing the wrong processes or changing them in such a way that they aren’t compatible with the software that you want.

In the same manner, companies that wait to look at internal controls until after they have selected new software and understand it’s functionality run a risk. The ideal solution is to be able to see the software’s functionality in action during the selection process to get an idea of what current processes will need to be updated and which ones are fine as is.

Taxi drivers in the UK must fill in a self assessment tax return if they have worked as a self employed taxi driver at anytime during the financial tax year. Self assessment tax returns should be filed by 30th September each year although the final deadline is the following 31st January. Failing to file the taxi accounts by 31st January attracts a 100 pounds late filing penalty with interest being charged on any tax not paid by this date.

The simplest solution to preparing the taxi driver accounts is to collect all the taxi receipts and expenses together, hand them over to an accountant who will prepare your self assessment tax return and might charge between 150 to 450 pounds for the privilege. That is taxing. Taxi driver accounts does not have to be that taxing. You can prepare your taxi driver accounts and self assessment tax return yourself but do something.

These taxi driver notes in preparing the taxi driver accounts and completing the self assessment tax return are to assist that process.

Mileage Allowances

Taxi drivers can claim as an alternative to vehicle running costs mileage allowances of 40p for the first 10,000 miles and 25p per mile thereafter. You may not claim mileage allowance and vehicle running costs. Should you choose to claim the mileage allowance then keep good records of mileage covered, purpose of journey.

Taxi Capital Allowances

If you bought a vehicle in the financial year 2007-08 and used the vehicle as a taxi you can claim a first year writing down tax allowance of 25% of the cost of the taxi, restricted to 3,000 pounds for vehicles costing over 12,000 pounds. On vehicles purchased in previous tax years you can claim 25% writing down allowance on the balance not yet claimed. Many taxis are bought and sold each year and where a taxi is sold the capital tax allowance that can be claimed is the difference between the written down value for tax purposes and the amount of sale proceeds. First year allowance on non vehicle assets in the current tax year 2007-08 is 50% for small businesses.

Taxis bought on Hire Purchase

Claim capital allowances on the original cost of the vehicle, interest and other charges count as business expenses and go in the self assessment tax return box 3.61 Other Finance Charges

Taxi Running Costs

When completing the self assessment tax return taxi drivers should enter fuel costs in box 3.46 cost of sales not motoring expenses. A standard check carried out by any competent inland revenue inspector enquiring into a self assessment tax return would be to check when the taxi driver was on holiday and examine if fuel receipts had been included for this period. Not many tax returns are enquired into as the system is based upon trust but taxi drivers should ensure their accounts do not contain this fundamental tax fiddle. Taxi running costs also include repairs, servicing and parts including tyres, road tax, taxi insurance and AA/RAC membership. Taxi administrative costs and expense items such as hiring the radio should be entered under general administration expenditure.

Household expenses

If you run your taxi business from home you can claim a proportion of household expenses as business expenses in the taxi accounts. Household expenses are likely to be disallowed unless they are either specific to the business or a specific area of your home is devoted entirely to your taxi business. Using part of a room part time would not be sufficient to include the household expenses in the taxi driver accounts.

Spouse Costs

You can claim expenses for partners who work for your taxi business and payments up to 100 pounds per week would not attract income tax or national insurance however any payments claimed in the taxi driver accounts must be real payments for real work done. As the claiming of a partner wages as a valid business expense is an area potentially open to abuse the Inland Revenue naturally take a strict view on such claims. Care is required to justify the partner as an expense.

Other Expenses

Enter all business expenses in a named expense box on the self assessment tax return. Avoid entries in box 3.63 Other Expenses if possible as any significant amounts in this box may give rise to an Revenue enquiry into the self assessment tax return.

The better and more detailed a taxi driver keeps records of incoem and expenditure throughout the year offers the best chance to pay the least taxxes at the end of that year. This is because with meticulous records every self employed taxi driver can then do the calculation of whether to claim mileage allowances ot vehicle running costs. Without good records the most tax efficient option cannot be made. The decision to claim mileage allowance or taxi running costs can and often does change during the financial year. In general when a more expensive taxi cab is purchased then the capital alloweance of 3,000 pounds will often outweigh the potential mileage allowance although if the vehicle is low value the mileage allowance might be the best option and a method of saving valuable tax pounds which you are entitled to. The best taxi accounting software will automate the comparison of taxi mileage allowances with taxi running costs doing the taxi accountants work for you.

Directors of companies are not self employed but employees of that company. In essence anyone who is in business either as a sole trader or part of a partnership and receives income that is not taxed under the PAYE system is effectively self-employed. Occasional miscellaneous receipts would not be regarded as self employment and should be entered on the tax return as all other income.

A regular source of receipts would be regarded as self employment income. Everyone considering themselves self employed should register with the Inland Revenue within 3 months of starting trading or risk a penalty fine of 100 pounds.

Keep a record of all transactions.

Sales turnover is the amount the business earns before deducting business expenses including receipts of any kind for goods sold or work done such as commission, tips, payments in kind, fees and insurance proceeds. Sales of fixed assets are excluded from sales turnover as are Business Start up grants which are entered in a different section of the self assessment tax return.

Excel spreadsheets make a good solution to record the sales income and bank receipts as part of the small business accounting software. Check the amounts deposited do not exceed the declared turnover which would indicate that you have understated your sales and your tax liability would at the least be increased unless you could provide a solid reason for the anomaly.

Ensure financial, purchase and sales records are compatible.

Compatibility will vary from business to business. Examples if you post 100 EBay items your records should show 100 items of income and 100 items of postage. Buy food for a restaurant for resale at four times cost, some wastage is inevitable but the underlying compatibility between sales generated and purchases should be reasonable.

The average number of meals sold from a take-away shop should be compatible with the number of take-away cartons purchased. A taxi driver should not claim fuel receipts during his holiday period and the fuel bills should be compatible with the fares obtained. Unusual and incompatible expenditure declared on the self assessment tax return can and do trigger Inland Revenue enquiries.

Many Inland Revenue enquiries result in a higher tax liability due to the scrupulous professional way in which compliance investigations are carried out.

Obtain receipts for everything.

Tax payers lose millions each year by not obtaining or retaining receipts for expenses. If you are claiming fuel costs for a business trip and fill up with 50 pounds of petrol get a receipt. The tax saved by including that receipt in your accounts is 11 pounds at basic tax rates and 20 pounds at higher tax rates.

If your business turnover is over the vat threshold of 64,000 pounds p.a. for 2007-08 the receipt is worth even more. 16.81 pounds vat and income tax at basic tax rate and 24.47 pounds at the higher income tax rate. The same is true for all other business receipts.

Obtain a receipt for everything.

If you lose a receipt then still include that expenditure in your accounting records but if your tax return is enquired into by the Inland Revenue that expenditure may be disallowed unless you can argue and sometimes prove the expense was in fact incurred. May help to note in your records – receipt lost.

Do not mix business and personal.

The general rule is that items solely for business use can be claimed for tax purposes and the business proportion of personal expenditure may be allowed although the rules are applied quite strictly. If you purchase both business and personal items from a supplier the business expenses only can be claimed but if you obtained all the items on a single receipt you would be disallowed the cost of that journey as it was not solely for business purposes.

Claim business expenses incurred prior to trading.

Business expenses incurred up to seven years prior to trading actually commencing can be deducted from business turnover if these expenses were solely for the future business purposes. Enter such expenses in your accounting records as if they had been incurred on the first day of trading but show the actual purchase date.

Claim home costs if you work from home.

If part of your home is identifiable as solely for business purposes then home costs can be claimed. The cost allowed is the proportion of the total area of the home the business area occupies. For example, excluding shared facilities of kitchen and toilet if the home has three bedrooms, living and dining room and one bedroom is used solely as an office then 1/5 of home costs could be claimed. The home costs to claim would be heat and light, insurance, general and water rates and mortgage interest excluding repayment amounts.

Where mortgage interest is claimed the revenue might also claim as a capital gain the increase in value of that proportion of the home, such Capital Gains Tax being subject to tapering relief over time. It may be safer not to claim mortgage interest as part of the home costs.

Take care if claiming the wages of a partner against profits.

Partner wages can be deducted as a business expense although there are rules which would be applied in such circumstances to ensure the amount paid is both real and reasonable. The business would need to operate a PAYE scheme for the partner wages, deducting income tax and national insurance, and produce all the statutory requirements.

The work carried out must be real not invented and the rate paid reasonable for the nature of the work and the time spent. Evidence may also be required that the partner wages were actually physically paid to that partner, for example in the form of a cheque.

Claim vehicle costs or mileage allowances.

Vehicle running costs and expenses such as fuel, excise duty, insurance, repairs and breakdown membership may be claimed as business expenses if the vehicle is used solely for business purposes. Travel from home to work is not business use and disallowed. The proportion of vehicle running costs and capital allowances which are claimable are dependent upon the proportion the vehicle is used for business and personal use.

Parking fees for business purposes may be claimed. Parking fines and penalties for motoring expenses are not claimable as business expenses for tax purposes. An alternative to claiming vehicle running costs and vehicle capital allowances would be to claim mileage allowances which at the time of writing are 40p for the first 10,000 miles and 25p per mile thereafter.

Write off expenditure against taxable profit unless the item is a fixed asset.

Depreciation is not allowed and replaced by Capital allowances for the purposes of calculating the tax payable. Capital allowances are designed to write off the cost of purchasing a fixed asset over the life of the asset rather than in the financial year in which it was purchased thereby spreading the tax relief on the asset over those years.

Many assets purchased by small businesses fall into a grey area as whether they are fixed assets or normal business expenses. Generally a fixed asset would be defined as an item that would be used by the business over several years and usually of significant value. 100% tax relief is obtained on items purchased which are not fixed assets and automatically claimed whatever the small business accounting software.

Avoid fines and penalties by submitting tax returns on time.

Accounting records and Self assessment tax returns should be prepared well in before the first submission date of 30th September to enable the information to be checked and verified before submission to ensure all possible claimable expenses have been included. The final deadline for submission is 31st January with late returns and payments being subject to penalty fines and interest payments which should be avoided.

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The initial planning to start your new business probably required a lot of time, effort and research. Just because you’re up and running doesn’t mean these activities have to come to an end.

Continued investment in your business can lead to progression and expansion, enabling you to develop your business. There are numerous different methods of expansion and the best approach depends on the type of business you own and how much money, time and effort you are willing to invest. If you are ready to make your business grow then keep reading for top tips on how to do so.

Physical expansion often springs to mind when considering business growth. Opening another location requires careful research and planning. First of all you should make sure you are maintaining a consistent bottom-line profit with consistent growth over the past few years.

Before setting up shop at a new location make sure your administrative systems and management team are working effectively because you will be hugely dependent on them to get a new site up and running.

Last but not least choose the new location for your business based on what is best for your business, not your wallet.

Another popular path to business growth is through diversification. Diversifying is a sound strategy for growth as it allows you to have multiple streams of income that can often fill seasonal voids and in turn increase sales and profit margins.

You can diversify by selling complementary or add-on products or services as well as importing and exporting yours or other businesses products.

Targeting other markets can also stand you in good stead if you want to expand your business. Think of secondary markets for your products and you might be surprised by what you can come up with.

For example, if your main target market consists of teenagers and students then think about introducing your business to schools, colleges and youth centres. You could offer discounts for bulk purchases or find other ways to incentivise alternative markets to purchase what you have to offer.

Global expansion can open up a whole new world of prospective customers. You will need to do some research into markets abroad and may need a foreign distributor but the effort could be well worth it.

Expanding to the internet is another option and with an increasing number of worldwide organisations now operating via the world-wide-web it’s important not to get left behind. A professional website is an integral part of business today and with so many online competitors it is vital to make your website stand out from the crowd.

Regardless of how you plan to expand your business, customer relationship management (CRM) is imperative to ensure each and every customer receives a consistently high level of service.

CRM software can help you to keep databases which help to retain current customers, procure new customers and keep everyone happy.

Taxi drivers in the UK must fill in a self assessment tax return if they have worked as a self employed taxi driver at anytime during the financial tax year. Self assessment tax returns should be filed by 30th September each year although the final deadline is the following 31st January. Failing to file the taxi accounts by 31st January attracts a 100 pounds late filing penalty with interest being charged on any tax not paid by this date.

The simplest solution to preparing the taxi driver accounts is to collect all the taxi receipts and expenses together, hand them over to an accountant who will prepare your self assessment tax return and might charge between 150 to 450 pounds for the privilege. That is taxing. Taxi driver accounts does not have to be that taxing. You can prepare your taxi driver accounts and self assessment tax return yourself but do something.

These taxi driver notes in preparing the taxi driver accounts and completing the self assessment tax return are to assist that process.

Mileage Allowances

Taxi drivers can claim as an alternative to vehicle running costs mileage allowances of 40p for the first 10,000 miles and 25p per mile thereafter. You may not claim mileage allowance and vehicle running costs. Should you choose to claim the mileage allowance then keep good records of mileage covered, purpose of journey. The DIY Accounting taxi accounting software automates this mileage allowance calculation.

Taxi Capital Allowances

If you bought a vehicle in the financial year 2007-08 and used the vehicle as a taxi you can claim a first year writing down tax allowance of 25% of the cost of the taxi, restricted to 3,000 pounds for vehicles costing over 12,000 pounds. On vehicles purchased in previous tax years you can claim 25% writing down allowance on the balance not yet claimed. If you have bought and sold a vehicle used as a taxi during the financial year the tax allowance is restricted to any loss made on resale and any profit made over the written down value is taxable as a balancing charge. First year allowance on non vehicle assets in the current tax year 2007-08 is 50% for small businesses.

Taxis bought on Hire Purchase

Claim capital allowances on the original cost of the vehicle, interest and other charges count as business expenses and go in the self assessment tax return box 3.61 Other Finance Charges

Taxi Running Costs

When completing the self assessment tax return taxi drivers should enter fuel costs in box 3.46 cost of sales not motoring expenses. Do not claim fuel expenses in the taxi accounts when you are on holiday, the revenue will check should they inquire into your self assessment tax return. Taxi running costs also include repairs, servicing and parts including tyres, road tax, taxi insurance and AA/RAC membership. Include radio hire and taxi office costs in general administrative expenses.

Household expenses

If you run your taxi business from home you can claim a proportion of household expenses as business expenses in the taxi accounts. Household expenses are likely to be disallowed unless they are either specific to the business or a specific area of your home is devoted entirely to your taxi business. Using part of a room part time would not be sufficient to include the household expenses in the taxi driver accounts.

Spouse Costs

You can claim expenses for partners who work for your taxi business and payments up to 100 pounds per week would not attract income tax or national insurance however any payments claimed in the taxi driver accounts must be real payments for real work done. The Revenue naturally adopt a strict view on taxi expenses claimed for partner work as it is an area some people might use to reduce the tax liability. Care is required to justify the partner as an expense.

Other Expenses

Enter all business expenses in a named expense box on the self assessment tax return. Avoid entries in box 3.63 Other Expenses if possible as any significant amounts in this box may give rise to an Revenue enquiry into the self assessment tax return.

The best method of ensuring the taxi drivers tax bill is as low as possible in the future is undoubtedly to meticulously maintain good records of all taxi receipts and expenses and mileage covered which offers the opportunity for taxi drivers to compare the taxi running costs against mileage allowances and choose the most tax efficient option. Generally if the taxi cab capital allowances are high vehicle running costs will be the best option and if taxi cab capital allowances are low then mileage allowances may well legally increase the costs you can claim and save you money.

The DIY Accounting taxi accounting software automates the comparison of taxi mileage allowances with taxi running costs doing the taxi accountants work for you.

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Taxi drivers in the UK must fill in a self assessment tax return if they have worked as a self employed taxi driver at anytime during the financial tax year. Self assessment tax returns should be filed by 30th September each year although the final deadline is the following 31st January. Failing to file the taxi accounts by 31st January attracts a 100 pounds late filing penalty with interest being charged on any tax not paid by this date.

The simplest solution to preparing the taxi driver accounts is to collect all the taxi receipts and expenses together, hand them over to an accountant who will prepare your self assessment tax return and might charge between 150 to 450 pounds for the privilege. That is taxing. Taxi driver accounts does not have to be that taxing. You can prepare your taxi driver accounts and self assessment tax return yourself but do something.

These taxi driver notes in preparing the taxi driver accounts and completing the self assessment tax return are to assist that process.

Mileage Allowances

Taxi drivers can claim as an alternative to vehicle running costs mileage allowances of 40p for the first 10,000 miles and 25p per mile thereafter. You may not claim mileage allowance and vehicle running costs. Should you choose to claim the mileage allowance then keep good records of mileage covered, purpose of journey. The DIY Accounting taxi accounting software automates this mileage allowance calculation.

Taxi Capital Allowances

If you bought a vehicle in the financial year 2007-08 and used the vehicle as a taxi you can claim a first year writing down tax allowance of 25% of the cost of the taxi, restricted to 3,000 pounds for vehicles costing over 12,000 pounds. On vehicles purchased in previous tax years you can claim 25% writing down allowance on the balance not yet claimed. If you have bought and sold a vehicle used as a taxi during the financial year the tax allowance is restricted to any loss made on resale and any profit made over the written down value is taxable as a balancing charge. First year allowance on non vehicle assets in the current tax year 2007-08 is 50% for small businesses.

Taxis bought on Hire Purchase

Claim capital allowances on the original cost of the vehicle, interest and other charges count as business expenses and go in the self assessment tax return box 3.61 Other Finance Charges

Taxi Running Costs

When completing the self assessment tax return taxi drivers should enter fuel costs in box 3.46 cost of sales not motoring expenses. Do not claim fuel expenses in the taxi accounts when you are on holiday, the revenue will check should they inquire into your self assessment tax return. Taxi running costs also include repairs, servicing and parts including tyres, road tax, taxi insurance and AA/RAC membership. Include radio hire and taxi office costs in general administrative expenses.

Household expenses

If you run your taxi business from home you can claim a proportion of household expenses as business expenses in the taxi accounts. Household expenses are likely to be disallowed unless they are either specific to the business or a specific area of your home is devoted entirely to your taxi business. Using part of a room part time would not be sufficient to include the household expenses in the taxi driver accounts.

Spouse Costs

You can claim expenses for partners who work for your taxi business and payments up to 100 pounds per week would not attract income tax or national insurance however any payments claimed in the taxi driver accounts must be real payments for real work done. The Revenue naturally adopt a strict view on taxi expenses claimed for partner work as it is an area some people might use to reduce the tax liability. Care is required to justify the partner as an expense.

Other Expenses

Enter all business expenses in a named expense box on the self assessment tax return. Avoid entries in box 3.63 Other Expenses if possible as any significant amounts in this box may give rise to an Revenue enquiry into the self assessment tax return.

The best method of ensuring the taxi drivers tax bill is as low as possible in the future is undoubtedly to meticulously maintain good records of all taxi receipts and expenses and mileage covered which offers the opportunity for taxi drivers to compare the taxi running costs against mileage allowances and choose the most tax efficient option. Generally if the taxi cab capital allowances are high vehicle running costs will be the best option and if taxi cab capital allowances are low then mileage allowances may well legally increase the costs you can claim and save you money.

The DIY Accounting taxi accounting software automates the comparison of taxi mileage allowances with taxi running costs doing the taxi accountants work for you.

More “accounting Software” Articles