Year-end rolls around…
Featured Products Promotional FeaturesPosted by: Dental Design 19th March 2020
Do you see financial year-end as an irritating, albeit necessary, interruption to workflow, requiring time, admin and stress? At time of writing, what the general financial landscape will look like on 5 April is anyone’s guess, too.
But it’s best to be a ‘glass half full’ type. So, use the lead up to the end of the tax year to focus on how your dental practice is doing and where it’s going. Did you achieve your goals? Have the posts shifted and do you need to reassess your business plan? Your profit and loss sheets will tell a big part of the story here. What lessons have been learned? Get the whole dental team on board with this, as well as any financial partners, so you can gain a clear picture, drawn from a variety of perspectives.
Be prepared
All your accounting needs backing up, so make sure records are up-to-date and accurate. Chase unpaid invoices and check receipts. Review suppliers’ contact info and ensure any software is the latest version – is it time to switch? The run up to year-end is a good time to audit recordkeeping processes and protocols. If you haven’t gone paperless yet, maybe this is something to consider. Cloud-based accounting solutions are efficient, save time and space, and are reliable. There are some great-value packages on the market, suitable for any size dental practice.
Get a grip!
Make sure you have a good grip on upcoming tax changes and how they could impact on you. One of the big ones after 6 April is the way that Capital Gains Tax (CGT) is reported and paid. From this date, when you sell a property, you’ll have 30 days to declare your gain (based on a provisional calculation) and pay the estimated tax due.
If you’re registered for self-assessment, you’ll need to declare your gain on your tax return, and pay any CGT over your estimate by 31 January. If you aren’t, you’ll need to review your estimated tax due in the year after you made a gain, then pay any adjustment. Regular readers will know that this is an important topic and must be taken into account for tax planning. There are also cuts in reliefs for capital gains on the sale of some residential properties to be aware of too. Talk with your specialist accountant about if the new rules apply.
Something else to consider before year-end is if you are claiming all the tax-deductible expenses that you are entitled to (so an expense that is “wholly and exclusively” for business use). Again, talk with your accounting expert. A brief note on dividends – the dividend allowance in the 2019/20 tax year was £2,000 so anything above that, you will need to pay tax on (the amount depends on which tax band you are in). Any dividends to shareholders need to be issued and paid before year-end.
All of the above is about maximising your tax efficiency after 6 April.
Any other business?
You’ll need to ensure you’re meeting your auto-enrolment responsibilities and, if there are bonuses being issued, that this is done in good time. Is it time to offer employee benefits schemes? Don’t neglect personal finance either – are you maximising your own savings/investments, including your pension?
Year-end is a time to refresh. Never make big changes without taking counsel from your specialist accountant – the team at Lansdell & Rose are experts in the financial and dental fields. Let them know if your attitude to risk has changed too, as maybe an opportunity that was off the agenda last year can be discussed now. See year-end as a golden time and not a hassle, and you and your practice will hit the ground running on 6 April!
Author: Michael Lansdell
To find out more, call Lansdell & Rose on 020 7376 9333,
Or visit http://lansdellrose.co.uk
