Archives January 2025

Key dates for SMEs: what you need to know for 2025


Throughout the year there are key dates that affect businesses. If you miss a deadline, it can be expensive.

Missing deadlines can have serious consequences: from financial penalties to damaged reputations, the repercussions can be far-reaching.

It’s not just disappointed customers: late tax payments can result in hefty fines and interest charges, so it’s crucial to stay on top of tax deadlines, such as VAT returns and corporation tax filings.

Business owners need to be aware of, and plan proactively for, key dates throughout the year. This includes budgeting for upcoming tax payments or having a plan in place to secure additional funding if necessary. By anticipating these financial obligations, businesses can mitigate risks and maintain a healthy cash flow.

Tax deadlines 

Sole traders 

Sole traders pay income tax and National insurance in two stages: 

  • 31 January 2025 – balance of any tax for year 2023/24 is due
  • 31 January 2025 - first payment on account of tax for year 2024/25 is due 
  • 31 July 2025 – second payment on account of tax for 2024/25 is due 
  • 31 January 2026 – balance of any tax for year 2024/25 is due 
  • 31 January 2026 – first payment on account of tax for year 2025/26 is due 

Self Assessments 

Self-assessment tax returns must be filed by: 

  • 31 October 2025 following the end of the tax year (paper returns) 
  • 31 January 2026 following the end of the tax year (online returns) 

Limited Companies

The payment deadline for Corporation Tax depends on your accounting period end date. Typically, you’ll have 9 months and 1 day after your accounting period ends to pay your corporation tax bill.

  • Return Filing Deadline: This is usually 12 months after your accounting period ends.

VAT

  • Quarterly VAT Returns: If you’re VAT-registered, you’ll need to submit quarterly VAT returns and pay any VAT due. The exact deadlines for these will depend on your VAT return period.
  • Annual VAT Return: Some businesses may need to submit an annual VAT return.

Other Important Dates

  • Confirmation Statement Filing: You’ll need to file a confirmation statement annually. The specific deadline will depend on your company’s incorporation date.
  • Company Accounts Filing: The deadline for filing your company’s annual accounts will depend on your company’s accounting period end date.

Statutory rate increases to note for employers:

National Minimum Wage rate increase will come into force from 1 April 2025: 

  • For workers aged 21 or over, NMW increases from £11.44/hour to £12.21/hour
  • For workers aged 18-21, NMW increases from £8.60/hour to £10.00/hour
  • For workers under 18, NMW increases from £6.40/hour to £7.55/hour
  • The apprentice rate increases from £6.40/hour to £7.55/hour

Payroll deadlines 

If you have employees, you’ll need to know the following payroll reporting and payment deadlines: 

  • 6 April 2025: Update employee payroll records for the new tax year 
  • 19 April 2025: Submit your final Full Payment Summary and Employer payment summary for the year ended 5 April 2023 and pay any tax/NIC due for the year. 
  • 31 May 2025: Give a P60 to all employees on your payroll who are working for you on the last day of the tax year 
  • 6 July 2025: Reporting of employee expenses and benefits 
  • 19 July 2025: Payment of Class 1A NICs by post, 22 July 2025 if paid electronically 

Disclaimer: all information correct at time of writing, 11 December 2024. Swoop does not give financial advice and recommends you confirm due dates and deadlines with independent financial advisors.



Finance

Should you borrow to grow your business? Swoop’s five-point checklist will help you decide


Everyone will tell you to borrow for your business, but is it the right strategy?

There are thousands of financial products on the market – from credit cards to commercial mortgages – and businesses make their money when you borrow. 

But should you be borrowing in the first place?

Unlike personal borrowing, business borrowing should be considered an investment that will have a positive return. For example, a new vehicle may be cheaper to run, project a more professional image or expand your existing fleet, meaning you can serve more customers. 

Swoop’s five-point checklist is designed to help you decide whether borrowing is right for your business.

Question 1: Is there a specific, clearly defined business need for the borrowed funds?

  • No: Reevaluate the need. Borrowing for unclear or non-essential purposes is generally unwise as you will be making repayments long after the funds have been used.
  • Yes: Proceed to Question 2.

Question 2: Can this need be met with existing funds (savings, retained earnings, etc.)?

  • Yes: Consider using existing funds to avoid incurring debt – though make contingencies for unexpected expenses and ensure you maintain a buffer to protect you against dips in income. 
  • No: Proceed to Question 3.

Question 3: Does the potential return on investment (ROI) from the borrowed funds outweigh the cost of borrowing (interest rates, fees)?

  • No: Reassess the investment opportunity or seek alternative funding sources, such as grant funding.
  • Yes: Proceed to Question 4.

Question 4: Is the business financially stable and capable of handling the additional debt burden?

  • No: Consider strengthening the business’s financial position before borrowing. Getting the timing right can make a big difference to your outcome.
  • Yes: Proceed to Question 5.

Question 5: Has a thorough financial plan been created to manage the loan repayment and its impact on the business?

  • No: Develop a detailed financial plan to ensure responsible borrowing.
  • Yes: Proceed to the decision.

Decision:

  • If the answers to all previous questions are “Yes,” borrowing money may be a viable strategy to grow the business.
  • If any answer is “No,” reconsider the need for borrowing or explore alternative funding options.

If you’ve got to “yes”:

If borrowing is right for you, make sure you evaluate the risks associated with the proposed investment and the potential impact on the business’s overall financial health.

Remember that being turned down for a loan can impact your credit score, which will make borrowing more difficult and expensive in future. Building an application with help from a  financial advisor or accountant will give you a greater chance of a positive result. 

You should also consider diversifying your funding sources as this will reduce your reliance on debt. Above all, weigh the pros and cons carefully and make an informed choice that aligns with your business goals.

Swoop can help: our aim is to help our customers grow their business in the right way, at the right time. We help SMEs access funding of all kinds, make it easy to compare rates and save money on must-have products including energy and insurance. Make sure you’re signed up here: [SWOOP LINK] 

Three borrowing products that might be right for your business

Borrowing doesn’t just mean a loan from the bank. Here are three innovative borrowing products that may suit your needs better: 

Start-up Loans

These are the best-value loans on the market for businesses in their early stages. You could borrow up to £25,000 per director and receive mentoring to help you use it wisely.
Find out more about start-up loans here.

Merchant Cash Advance (MCA)

If you use a credit card terminal and unpredictable income, this could be ideal for you. Funds and borrowed at a set fee and you pay back the capital as a fixed percentage of each sale.
Find out more about merchant cash advances here. 

VAT Finance

If your business has a quarterly VAT bill, you can smooth your cashflow with VAT Finance. Holding onto more of the money you’ve earned for longer can give your business advantages.
Find out more about VAT finance here.

To explore all of the options available to your business, create a free account today.



Finance

What, Why & How to Register with Companies House


 

Managing a business in today’s environment entails navigating a web of regulations, compliance standards, and administrative responsibilities. This is where Authorised Corporate Service Providers (ACSPs) come in. ACSPs are trusted intermediaries who file information and verify identities on behalf of firms with Companies House, assuring compliance and fraud prevention.

With new guidelines enacted under the Economic Crime and Corporate Transparency Act, all ACSPs will be required to register their businesses beginning in Spring 2025. This blog will explain all you need to know about ACSPs, including why and how to register.

 

What Are Authorised Corporate Service Providers (ACSPs)?

Authorised Corporate Service Providers (ACSPs) assist UK firms in meeting their compliance needs. Experts, such as accountants, solicitors, and company formation agents, undertake crucial activities such as filing legal documents and verifying identities. They ensure that businesses comply with regulations without difficulty.

Here’s what ACSPs typically do:

  • Help with company formation by filing the necessary documents.
  • Manage ongoing compliance by submitting annual confirmation statements and updating company information.
  • Ensure Anti-Money Laundering (AML) requirements are followed.

But starting in 2025, these responsibilities will come with stricter oversight. To keep offering these services, ACSPs will need to register with Companies House.

 

Why Register as an ACSP?

The new registration process isn’t just about meeting legal requirements—it’s about building trust and transparency:

  1. Accuracy and Transparency

By verifying identities, Companies House can ensure that the information on the public register is accurate and dependable, resulting in a system that businesses can trust.

  1. Fraud Prevention

Knowing exactly who is submitting information helps Companies House quickly spot and address fraudulent or suspicious activities.

  1. Enhanced Collaboration

Registration makes it easier for Companies House and regulatory bodies to share data, strengthening efforts to prevent economic crimes and protect businesses.

If you’re an agent working with Companies House, these new changes mean you should start preparing for the registration process, so you’ll be fully prepared when it launches.

 

How to Register as an ACSP with Companies House

The registration process will open in Spring 2025. Here’s how you can prepare:

  1. Review the Requirements

  • Familiarise yourself with the changes introduced by the Economic Crime and Corporate Transparency Act.
  • Ensure your business is AML-regulated and locate your membership number.
  • Update your internal processes to meet identity verification standards.
  1. Submit Your Application

When the registration portal opens, you will need to:

  • Provide details about your business, including the AML supervisory body membership number (sometimes called an ID number).
  • Verify the identity of key individuals, such as directors or sole traders.
  1. Get Your ACSP Credentials

Upon approval, you will receive:

  • A digital account to manage filings more efficiently.
  • A unique identification number that confirms your authority to act on behalf of clients.
  1. Add Team Members

Following registration, you can grant access to other employees in your business. While these employees won’t need to undergo identity verification themselves, they will be able to help with filings and identity checks for clients.

 

What’s in It for You?

Becoming an ACSP is not only about compliance but also about building trust and streamlining operations.

  • Stay Compliant: Make sure your business meets UK company law and follows Anti-Money Laundering (AML) regulations.
  • Save Time: Streamline the process of managing filings and verifying identities for your clients.
  • Increase Credibility: Clients will trust you more if you are registered and authorised by Companies House.

 

Next Steps

Although registration won’t open until Spring 2025, you can start preparing now:

  • Examine the changes to UK company law and comprehend the new obligations of ACSPs.
  • Double-check your compliance with AML regulations and locate your membership number.
  • Stay updated by following announcements from Companies House and GOV.UK.

 

Conclusion

The ACSP registration process in the UK significantly improves company compliance. By registering as an ACSP, you meet legal requirements while also promoting your company as a trustworthy partner in managing filings and fostering transparency.

For additional information on ACSPs, visit the DataTracks blog 

 

 

 

 



Finance

Is Your Business Ready for MTD for ITSA and Digital Tax?


 

Tax systems in the UK are undergoing a digital revolution and Making Tax Digital for Income Tax Self-Assessment (MTD for ITSA) is leading this charge. This is a big change for sole traders and landlords. MTD for ITSA is designed to reduce mistakes, save time, and simplify compliance with digital record-keeping and regular updates.

In this blog, we’ll explain MTD for ITSA, when it’s happening, and why it’s important for you.

 

Who Will Get Affected by MTD for ITSA?

The implementation of MTD for ITSA begins in April 2026 for:

  • Sole traders earning over £50,000 annually.
  • Landlords with rental revenue of more than £50,000 each year.

By April 2027, the threshold will be reduced to £30,000, bringing more people under its scope. For those with incomes below this, voluntary sign-ups are available for a head start.

Looking ahead, the government has hinted that the threshold could drop to £20,000, but there’s no set timeline yet.

 

What Do You Need to Do Under MTD for ITSA?

If MTD for ITSA applies to you, here’s what you’ll need to do:

  • Keep Digital Records: Get rid of paper receipts and spreadsheets. Use compatible software to log income and expenses.
  • Quarterly Updates: Submit digital updates to HMRC every three months, offering a real-time snapshot of your finances.
  • HMRC-Approved Software: Use software that meets HMRC’s standards for submissions.
  • End-of-Year Statement: Reconcile and submit a final declaration at the year’s end.

 

Why Does MTD for ITSA Matter?

Managing taxes can be difficult, but MTD for ITSA is here to simplify the process. Here’s how:

  • Closing the Tax Gap: Did you know errors in self-assessment filings account for around £5 billion in unpaid taxes each year? By using digital tools, MTD for ITSA aims to reduce these errors and ensure everyone pays the correct amount.
  • Saving Time and Reducing Stress: Digital tools automate routine tasks, so you can spend less time on admin and more on running your business.
  • Avoiding the Year-End Panic: Quarterly submissions ensure your records are up-to-date, easing the final filing.

 

What About the Costs? 

  • Upfront Costs: You might need to spend around £320 to upgrade your software and equipment.
  • Ongoing Costs: Software subscriptions cost about £110 annually, though costs might be lower for those already using digital tools for VAT.
  • Support from HMRC: HMRC partners with software developers to provide affordable solutions and offers webinars, helplines, and guides.

 

When Does MTD for ITSA Start? 

  • April 2026: Mandatory for incomes above £50,000.
  • April 2027: Mandatory for incomes between £30,000 and £50,000.
  • Future Plans: Likely to include those earning over £20,000.

If you fall outside these thresholds, consider signing up voluntarily. It’s a great way to familiarise yourself with the system before it becomes compulsory.

 

What’s the Bigger Picture?

MTD for ITSA is the next step in the digital transformation of tax, building on the success of MTD for VAT, which was introduced in 2019. Many businesses using MTD for VAT have already seen the benefits—fewer mistakes, smoother filing processes, and improved financial management. MTD for ITSA promises to deliver the same advantages, making tax compliance easier and more efficient.

But it’s not just about meeting tax requirements. Going digital can simplify your financial management, uncover new ways to save money, and help you make smarter business decisions.

For more details, visit the HMRC website. 

 

Conclusion: A Digital Tax Future Awaits

Making Tax Digital for Income Tax is more than just a requirement; it is an opportunity to streamline your tax procedure and focus on what is actually important. While the transition may seem difficult at first, the advantages outweigh the effort.

Ready to make the switch? DataTracks can support you every step of the way. With our expertise in digital tax solutions, we will ensure a seamless transition and full compliance with HMRC’s rules.

MTD for VAT made tax filing easier. Now, MTD for ITSA is set to do the same. Don’t wait—get ahead of the curve with digital tools! Get in touch with a DataTracks expert at +44 (0) 203 608 8035 or email [email protected].

 



Finance