2019 has not been the easiest of years for many of our clients, the lengthy political and economic uncertainty is making the general public think a lot more about spending their hard-earned money.  Small businesses are having to renegotiate with their suppliers and look at all their costs to ride the storm we find ourselves in at the moment.


Not ones to sit down and wait for things to happen, this blog is about refinancing. 2019 may not have been the best year, but let’s not sit and see if 2020 will be better. Now is the time to review your finances. Autumn is a great time of year to look at this, you’re halfway through the financial year, summer is over, and Christmas is around the corner, the end of the year will be here before you know it.

So, what is refinancing?

Refinancing is the process of replacing an existing loan with a new loan. Typically, people refinance so they can get a better deal on their current loan. For example, you may be able to get a better interest rate than what you are on currently, saving you money. Refinancing also depends on your credit score, current deal and many other factors.


You may also have some assets in your business currently tying up cash and want to get a loan to put more liquid cash into the business, to allow you to put some plans for 2020 into practise right now.

Why refinance?

If you have a loan or a mortgage, it is worth speaking to the provider for refinancing. Some potential advantage of refinancing includes:

  • Lowering your monthly payments. You can then put to use your extra saving to pay off other debts or towards your saving goals.
  • You can combine your debts into one with some refinancing options. This is good so you know exactly when payments need to be made.
  • Usually able to negotiate lower interest rates.
  • Cashflow is tight but you have some assets that can assist you gain some cash to put back into the business.

Studies have shown that trying to negotiate a better refinancing deal tends to save people money and a lot of stress. Some questions to ask yourself is if you are paying too much monthly on any equipment that you could possibly lower or if you are too dependent on your bank overdraft as it is one of the most expensive bowing methods. Knowing where all your finances lay can help you budget and with the extra cash you can invest in yourself or your business.


Mortgages are the cheapest form of loans, credit cards tend to be the most expensive. It may be a time to sit down with your bank manager or even your accountant and look at the best ways of saving yourself some interest along the way.

Typically, business owners who plan ahead with their finances and put plans together not only achieve their plans, but tend to be charged less by the banks for the privilege of lending money from them.


So what are you doing, get planning 2020 is going to be an amazing year, let it be a good one for you.

We all want to leave something behind for our loved ones. It’s what we get up in the morning and work hard for. But a financial gift unfortunately has a tax implication to it. Research shows that only 45% of people making financial gifts are aware of Inheritance Tax.


It is always recommended to write a will, you can get a professional to do this for you for as little as £150. Make sure your money goes to who you want it to.    


We are hearing a lot of cases where there is no will. It can cause issues in a couple of situations example if your partner needs to go into a nursing home. What happens to children under the age of 18. Your wife, husband or civil partner having difficulty accessing family funds.


The treasury benefits from £5.8 billion income in inheritance tax each year. There are also 10,000 unclaimed estates where a no next of kin has been found worth more than £150,000, plus thousands more amounting to several million pounds. After 30 years that money is gone if a direct descendant cannot be found, it goes straight to the treasury and not to your family.    


Live in partners are not next of kin, even if they have been living with you for 20 years or more. Under inheritance tax law they have no rights to anything if a will has not been created.


So, what is Inheritance Tax?

Inheritance Tax is a tax on an estate of someone who’s died. An estate is the likes of property, money and possessions. There is a tax-free threshold of £325,000. You normally don’t have to pay inheritance tax if the value of your estate falls below the £325,000 threshold.


If you pass all your assets to your wife/husband, civil partner there is no inheritance tax to pay, its only when you give assets away to other people that inheritance tax is payable. Its 40% tax over and above the nil rate band.


There is an elected transfer to your spouse, civil partner or charity where both your nil rate band and your partners can be added together to make a maximum tax-free amount of £650,000. The transfer is claimed on the occasion of the 2nd partner dying. It’s not automatic there is a form to complete for this. Don’t assume its Automatic.


Your threshold can also increase if your estate is worth more than £325,000 and you give your home away to your children (this includes adopted, foster or stepchildren) or grandchildren. There is up to an extra £150,000 available to be added to your threshold. If the estate is below £325,000, you will still have to report this to HMRC. Probate forms usually must be completed within a certain timeframe of someone dying.    



Say your estate is worth £550,000, your tax-free threshold is £325,000. You will get an increase of up to £150,000 if your home is given to direct descendants. The inheritance tax charged will be 40% of £75,000.


Who pays the tax bill?

Funds from your estate are used to pay the Inheritance Tax to HMRC.  If there is a will this is done by the person dealing with the estate known as the executor. The beneficiaries are the people who inherit your estate do not normally pay the tax on the things they inherit.


7 Year Rule

There is normally no inheritance tax to pay if you gift your home and live for another 7 years, although capital gains tax might come into play.  If you die within 7 years of giving all or part of your property, your home will be treated as a gift and the 7-year rule applies. There are many tax reliefs that can be gained between the 0 years and 7-year rule. Always use an accountant if your estate has multiple sources of income. Don’t miss out on the hidden tax reliefs.



You do not have to pay any tax on gifts between spouses, you can give them as much as you like during your lifetime.   


Anyone is entitled to give gifts of up to £3,000 per annum without any inheritance tax being involved. You can carry over an unused annual exemption to the next financial year, this can only be the next financial year that immediately follows. It’s important to record this in a diary as proof to avoid it being used to reduce your nil rate band.


You can also give away the following, in each tax year:

·         Wedding gifts of up to £1,000 to any person (£2,500 to a grandchild, and £5,000 to a child)

·         Normal gifts out of your income, such as Christmas or birthday presents

·         Payments to help another person’s living cost such as an elderly relative

·         Gifts to charities and political parties

You can also give as many gifts of up to £250 per person as you want during the tax year if you have not used another exemption on the same person.


Inheritance tax is a complicated tax system that encounters many of the other tax systems within it, always seek professional advice if this is not a straightforward estate.

For those of you watching the Glastonbury Festival over the weekend.     

It was a great boost to our UK economy.   Some £40 million turnover taken over the 5 day event.  Over 200,000 people attended and 3 million people tuned in to see Kylie Minogue, with Stormsy and The Killers pulling in great ratings too.

Donations to Oxfam, Green Peace and Water Aid were the main charities benefiting from the event.

The area I want to draw to your attention was over 200,000 attended the event this year, and over 400 small food and merchandise providers helped make the event a great success.

Whether you love it or hate it,   its provided a great boost to what has been so far quite a difficult 2019 for many retail and service outlets.

Those 400 food and merchandise providers will be providing jobs to thousands of people, creating work for not just the Somerset area but all over the UK, as a lot of the suppliers would have travelled to the area for work.   

There was also 2,000 volunteers mainly representing and supporting the three main charities.

With our continuing confused political market at the moment, with uncertainty with what is happening with Brexit.    A lot of small businesses are struggling to keep a float,  they are finding it harder to gain long term contracts, and being able to gain fixed prices for goods that may be coming from overseas.    The uncertainty affects everything.    The exchange rate of the Pound Sterling to Euro is also still highly volatile.

Please keep supporting your local businesses, they are keeping millions of people employed at the moment, we most definitely need them into 2020.

We never hear about them in the news when they suffer, they just go about their business quietly.       We only hear about the larger companies finding things tough at the moment.

Our economy and stability we all like to take for granted heavily relies on them.

Give your local business whoever they are your full support in 2019 regardless of the political outcome.      Lets keep our economy robust to ride the storm.

#shop local

We’re halfway through the year and 2019 is not slowing down for anybody. There are approximately 5.7 million businesses in the UK, of which 96% are considered small or micro. So, we small businesses are crucial to the UK economy, there is no denying this.


Whether you are a start-up and excited for the times ahead, or an establishment renewing your challenges, we all want to be successful with our business. In our latest blog, we talk about tips we think are vital to any business.


We all have a vision in mind, of where we’d like to see our business in the future. This vision needs to be translated on paper as your business plan. A business plan is a must for all business owners. This can help outside investors get an insight of your business, for if ever you need funding to grow your business.


Business Plan

A business plan should consist of;

·    Summary – What is your purpose, what is your vision?

·    Target market – Who are you likely to sell to

·    Competitors – What is your rivals weakness? Why are you different?

·    Staff – Do you need people to help run your business. What level of skill and pay is required?

·    Suppliers – Who will be your main supplier?

·    Marketing Plan – How will you advertise yourself to the world

·    Operations – Which is the best way to run your business.

·    Finance – How much money do you need? Determine the profitability of the business.


Business Structure

As well as a business plan, you will need to have a business structure. Sole trader, partnerships and limited companies all have their own pros and cons. Deciding which structure to choose is not always straightforward. If an asset is owned outright, then you would need to consider retaining personal ownership on incorporation. If you’re not sure which structure model you should go for, then here at Cross Accounting we can give tailored advice to you.


Year End

We cannot stress enough the importance of doing your year end as early as possible. Once completed, this will give you peace of mind as you will not have to worry, until next year. It will also give you more time to budget for your tax bill. You will not be in a rush to find the money for the tax bill and not kill your cashflow. Keep all receipts for your expenses, these will all help lower the tax bill. If you buy equipment or tools, mobile phone bills, petrol, these are all deductible. HMRC can conduct random spot checks, so it’s important to keep paperwork, recommended for 6 years.



Having budgets in place for your business can help you predict the near future. This allows you to have a spending plan, so you can make sure you have money for the things you need and the things that are important to you. You can see what is eating up your cash and avoid spending on unnecessary fees. Below is an example of a very simple budget.



Month 1 (Budget)

Month 1 (Actual)


Month 2 (Budget)

Month 2 (Actual)


Month 3 (Budget)

Month 3 (Actual)


Starting Cash




















Total Income


















































Gas and Electricity










Total Expense




















Income - Expense











These tips will keep you motivated and more importantly give you an idea of where your finances lay, helping you to quickly identify if there are rainy days ahead.

If you need expert tailored advice, please do get in touch as we are always happy to help.

The new financial year is in full swing, and it’s when the new rates and regulations kick in. Your personal allowance has changed along with other vital thresholds that take effect when it comes to completing your tax return.


Personal Allowance

The new year brings the new personal allowance at £12,500 for the year. So, what is your personal allowance? Personal allowance is the amount of income in which you do not have to pay tax on. You will pay tax on anything over the £12,500, the table below will display what percentage of tax you pay in each band.


Tax Rate

Taxable Income



£0 - £12,500

Personal Allowance


£12,501 - £50,000

Basic Rate


£50,001 - £150,000

Higher Rate


£150,000 +

Additional Rate


You do not get a personal allowance on taxable income over £125,000. Any income above this threshold and tax will be due on all amounts to the respective band.


Dividend Allowance

As well as the personal allowance, the dividend rate has also changed. Just like a personal allowance, you also have a dividend allowance. Dividends that fall in within your personal allowance do not count towards your dividend allowance.


The tax you pay depends on which Income Tax band you’re in.


Tax Rate



Dividend Allowance of £2,000


Basic Rate


Higher Rate


Additional Rate



Say you were to get £4,000 in dividends in the 2019 to 2020 tax year. The dividend allowance is £2,000, so this means you pay tax on £2,000 (£4,000 minus £2,000) of your dividends. Your other taxable income is £30,000. Add this to your dividends of £4,000 and your total taxable income is £34,000. You pay a rate of 7.5% on £2,000 of dividends because your total taxable income is within the basic tax band.


National Minimum Wage

If you employ staff, then you are probably aware that the National Minimum Wage rate has also changed. It is a legal requirement to pay the NMW as an employer.



25 +

21 to 24

18 to 20

Under 18


1st April 2019







For all the rates mentioned, they usually change every year, typically in April. You must be aware of these rates to make the most out of completing your tax return and to fulfil your legal obligation. There are many other allowances and rates, but the ones mentioned are the usual ones that affect everyone. If you are worried about whether you are in the right tax band or not sure if you’ve used up all of your allowance, please visit our website on www.crossaccountingservice.co.uk or call us on 02920 653 995 where a member of staff can assist. We are always happy to help.