Blog Category: financial planning

The three steps of genuine wealth building

01 June 2011

If you want to build genuine wealth, you need to follow three simple steps. Does it sound oversimplified? It is not. People often wrongly believe that you need a special talent, or, at least you must have a privileged birth, to be wealthy. Neither is true. While history has seen many talented people at a loss to earn their daily income, there are many that were born with the privilege of a rich inheritance but eventually squandered away all their wealth to live a meager living at their old age.

The whole process of building wealth boils down to three simple steps. Step one: You need to earn enough. Step two: You need to save enough and Step three: You need to invest your savings wisely. While these steps may sound very obvious, they are not very easy to implement

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Five Small Business Tax Strategies the IRS Don't Want You to Know

14 January 2011

Paying tax is one of things no one can escape whether you are a business owner or an employee we all have to pay tax.

The world renowned Benjamin Franklin said Certainty? In this world nothing is certain but death and taxes. In this article I hope to highlight five small business tax strategies the IRS dont want you to know which will help you get the better deal when it comes to paying your tax bill at the end of the year.

1. START A SMALL BUSINESS starting a small business itself is a great tax strategy because you can claim back the cost of accounting, advertising, banking, consultancy, entertainment, marketing, meals, parking, travel, insurance, computer equipment, medical expenses, trade shows and training equipment and many more. So being able to get the cost of all these things back when doing your return is fantastic.

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How is the VAT Increase Planned for Jan 2011 Going to Affect Your New Business?

05 November 2010

"Tough luck," is basically what Chancellor George Osborne said when the new Value Added Tax (VAT) increase was announced. Come January 4, 2001, the VAT will reach 20% and undoubtedly change the way people do business, even if its only forcing people to pay more attention to their expenses.

The implications for start-up businesses might be a little harsher, however. Its important in any case to examine what this increase means to business and, more importantly, customers.

First up with the possible implications of this increase, lets take a look at how customers might behave due to the new 20% measure going into effect.

Realistically, a 20% increase means that products once costing 117.50 will now cost 120. So, its not that much of a rise when you put it in terms like that. Even still, there's always the possibility that businesses are trending their prices up by a few percentage points to cover their expenses, and that could lead to an even higher increase.

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Managing Cash Flow for Company Growth

14 June 2010

In any business, cash is the lifeblood that keeps everything afloat. If your money is poorly managed, your company will not only fail to grow, but it might implode and become one of the high percentages of failed businesses. One cash flow problem in business is the time between paying suppliers and employees and the time you're collecting most from your customers.

In four relatively simple steps, you can work to keep better track of your cash flow and streamline the process to aid in company growth.

Step One: Cash Measurement
It might be tedious, but it's important to work on cash flow projections. You should not only project cash for the year, but go further into the process and project earnings by the quarter or even by the week.

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What Items are Zero Rated from VAT in the UK?

09 June 2010

VAT is something many businesses will have to contend with when purchasing items and when attempting to sell them. The UK's VAT isn't quite as high as other European countries, but in 2009, the nation suffered a 3.7% consumer inflation bump, and then Chancellor Alastair Darling (pictured) declared that VAT should be restored to 17.5% on a wide range of goods and services.

Similar to a sales tax, the value added tax is a levy tacked on based on estimated value as a product goes from material stage, manufacturing and finally distribution. This tax is ultimately passed on to the consumer, so finding zero-rated items is the ideal for most small businesses. This creates big savings on expenses and, of course, customers appreciate the lower prices.

It's hard at times to find a proper niche in the market and grab a product that isn't subject to VAT. This becomes especially difficult when dealing online, as most affiliates are working to sell high-end electronics. However, there are a few products for online businesses not subject to the high VAT.

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Will Floating on the Stock Exchange Tie Your Firm Down?

26 May 2010

A lot of businesses decide to venture into other areas of potential earnings once they're established and doing well. Many men and women around the globe specialize in taking things to the next level in terms of stock market options. Many more, however, are run-of-the-mill businesspeople and are not fully aware of the stock exchange's implications.

If you're planning on floating your business on the stock exchange, what exactly are you in store for?

In simple language, floating on the stock market simply means you have sold a percentage of your business as shares. The London Stock Exchange is usually dominated by larger firms choosing to go this route, while AIM (Alternative Investment Market) and PLUS are around for smaller companies wishing to go the same route.

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How do you pitch for finance to get funding for your start-up

05 August 2009

Government officials may be trying to tax small business into extinction, but that doesn’t deter the many thousands of individuals with dreams of becoming small business owners. Unfortunately, not many people planning to go into business have enough money to get started.

Even something like a website business can take thousands of dollars to get going. When you’re dealing with an on-site clothing store, corner grocery, print shop, etc, the funding needed increases exponentially. If most had the money needed to start a business, ironically, they wouldn’t need to start a business.

The truth of the matter about businesses is they need to be funded by outside resources, such as loans from banks that specialize in just that. Knowing where to look, however, is only half the battle.

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How does VAT work within my small business when I first start up?

30 November 2008

VAT is the Value Added Tax which is added to goods and services as a means of a consumption levy on value being added to a chain. This is a tax charged at each stage between the producer and the consumer of a good or service, so in effect, the charge flows downstream.

As of December 1, 2008 the cost of the VAT will go down to 15 per cent and back up again to 17.5 per cent January 1, 2010. There are a few items that carry a lesser charge like some fuels. Other things like food, periodicals, clothes for kids and some medically based items carry no charge at all.

A business making less than £67,000 annually does not have to register for the VAT 9 digit number. This is nice for the new business on the block, making the cost of goods or services provided significantly less than a VAT registered competitor. If you do startup a business and register for your VAT number you first have to evaluate what it is you are selling and see where it falls in the VAT cost breakdown. As we discussed before some items carry a lesser charge, some no charge at all.

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