Welcome to the Autumn 2009 edition of Professional Practice, the regular newsletter from Baker Tilly’s professional practice group.

With continuing uncertainty in the economies of most developed nations, management teams in professional firms are working hard to look after all their people – clients, employees and partners alike – while keeping a strong grip on cash flow. As we go to press, some green shoots seem to be appearing, with eyes turning towards the next set of official statistics with hope that they will bear news that the UK has at last emerged from recession. Of course, managing in a recovery is a challenge in itself: that will be the focus for our next newsletter. 

With cost savings still at the forefront of most firms’ agendas, this edition brings you ideas for minimising the effect of tax changes, avoiding potential pitfalls and potentially reclaiming tax already paid. 

If you would like to discuss any of the topics covered in the newsletter, please do contact the authors or your usual Baker Tilly contact.

Articles

Guidance on the VAT rate change
As has been widely publicised, the standard rate of VAT will revert to 17.5% with effect from 1 January 2010. This means that firms should be thinking now about their billing arrangements, particularly in respect of those clients that cannot recover all the VAT they are charged. Find out how the rate change will affect you.

Opportunity to reclaim overpaid Class 4 NIC on partnership annuities
An unintended change in tax law may mean that partnership members have missed out on claiming relief against Class 4 National Insurance Contributions for annuities paid to former partners in 2007/08. Find out if you are eligible to reclaim overpaid NIC.

A cautionary tale
It is easy to overlook PAYE and other employment tax matters, but they could be costing your practice more than all the partners’ or owners’ taxes put together. It makes sense to get them right and there are some pitfalls for even the most commercial of businesses. Read about some of the pitfalls.

Confidentiality – are you compliant?
The Law Society’s Code of Conduct Rule 4 sets out a general requirement of confidentiality as follows:
‘You and your firm must keep the affairs of clients and former clients confidential except where disclosure is required or permitted by law or by your client (or former client).’
Read more to see if you have the necessary controls in place.