The Fizz! Blog

There's no perfect networking group

The other day someone at a networking event said to me "Of course, the thing with networking is that it's all about finding the right group."  

That's pretty much the exact opposite of what I believe.

Many people flit from group to group, looking for a magic format that's going to make everything work brilliantly for them right away.  But it doesn't work like that.  Really, all these groups are more or less rooms with people and coffee in them.  If the people are idiots, then there's no format that's going to solve that.  If the people are good, then they'll be able to work round any format, get to know one another, and make useful connections.

Over the years, we've been to various groups, and we've stuck with any where we've thought that there's a critical mass of good people, or where we just enjoy ourselves when we're there, without any particular expectation of financial benefit to our business.  We've got something good out of all of those groups, whether in terms of enjoyment, useful connections for us and our clients (finding good people that we can recommend to our clients and to others is actually a more important aspect of networking to us than getting business for ourselves), and ultimately growing our business.  With all of those successful groups, it's happened because we stuck with it and just talked and got to know people without expecting that this group was just going to do everything for us with its supposedly brilliant and ground-breaking format.

So, our recommendation: if you find a group that has a decent number of people going and not too many of them are idiots, then stick with it.  It might get you business, it might get you friends, it might get you some interesting anecdotes, it might give you some support if you work alone, it might give you people to bounce ideas off, it might make you better at explaining concisely just what you do and the benefits you bring (it will definitely do that, in fact), but it will certainly do something for your business and for you as a person.  If you keep going into new groups, getting to know people on a superficial level and then leaving again, little of that is likely to happen.  Turning up consistently to something good is likely to be far better for you than searching endlessly for something perfect.

www.fizzhq.com

Tax relief at Christmas!

Since you may well be planning a Christmas party for your staff - in fact, around here it seems that if you've not booked it already you might struggle to get in!  So, we thought we'd summarise the tax rules around Christmas parties and gifts for you.

If an employer provides a Christmas party that's available to all of its staff (note that this really applies to PAYE employees, as opposed to, say, freelancers), where the cost is less than £150 per head, then it can reclaim all of the VAT and deduct the entire remaining cost from its profits before working out its tax bill - effectively, if a normal VAT-registered limited company holds its party at a normal VAT-registered venue, every £100 spent on the party ends up costing the company £67.  Actually, those allowances apply to annual events, not specifically Christmas ones - so you could have, say, a summer barbecue *and* a Christmas party costing less than £150 a head in total and still reclaim all of the VAT and get tax relief on the balance.

If you want to give a Christmas gift to staff, then in practice HMRC consider a relatively small item like a turkey or a fairly normal bottle of wine to be trivial, and won't try to tax the employee on the value of the gift.  Assuming there's VAT on the gift when you buy it, then once more the ultimate cost of £100 of staff gifts to a normal VAT-registered limited company employer will be £67.  Anything more valuable the employees will have to pay tax on - and you'll have to pay National Insurance too.

If you give gifts to customers, then they'll only save you tax if:

• The total value of gifts in a year to the customer is less than £50,
• The gift has a clear advert for your business on it, and
• You can't eat, drink or smoke it!

If you want to give a customer a bottle of whisky then that's still completely fine, and may well make great business sense!  It's just that for every £100 you spend on gifts like that, it costs your business the full £100 - you can't reclaim any VAT or reduce your corporation tax or income tax bill at all.

www.fizzhq.com

Changes to Child Benefit

Changes to Child Benefit

There's been lots of coverage in the news about changes that will claw back Child Benefit from some higher earners, starting from January.  HMRC are also sending out letters to all the people they think might be affected.  The changes are pretty illogical and weird in many respects, but we're stuck with them, so here's how they'll affect you:

1. If the higher earner of you or your partner has income of more than £60,000, you'll lose all of your Child Benefit - either the higher earner can repay it via their Self-Assessment Tax Return, or the recipient can just not claim it to begin with - but if your circumstances change you'll need to remember to reinstate your claim.
2. If the higher earner of you or your partner has income of more than £50,000 but less than £60,000, you'll lose some of your Child Benefit - the higher earner will repay it via their Self-Assessment Tax Return.
3. If the higher earner of you or your partner has income of less than £50,000 then you keep all of your Child Benefit.
4. If you don't get any Child Benefit to begin with, then none of this makes any difference to you!

So, if you're in categories 1 or 2, is there anything you can do about it?  Well, making personal pension contributions effectively reduces your taxable income, so you might consider that - as long as you can afford it and it fits with your retirement planning.  Charitable donations would do the same, although of course you'd be giving up the money forever that way.  Some people might even consider earning less - you may be less inclined to do extra work or overtime if the tax you pay on the extra income is effectively closer to 60% than it is to 40%.

If you want to discuss and understand further the impact of the changes on your finances, you should talk to your accountant (if you have one!).  Of course, if we prepare your personal tax return for you, then we'll be discussing it with you in April in any case.

www.fizzhq.com