Picture this: your business is booming, and it’s time to invest in some new equipment or a company vehicle. But with so many financing options out there, how do you decide which one of them is right for you? Let’s break down three popular choices – leasing, contract hire, and hire purchase – so you can make an informed decision without getting lost in financial jargon.


Leasing means renting an asset (such as machinery, vehicle or computer) from a finance company for a set period. After the lease term ends, you usually return the asset, although sometimes there is an option to be able to buy it.

Short-term rentals where the payments cover the asset’s use, rather than its full value, are known as operating leases. At the end of the lease, you return the item and can lease a newer model.

Longer-term rentals where the payments cover the full value of the asset over time are known as finance leases. The leasing company legally owns the item, but you use it as if is yours.

Here’s why leases can be good:

  • Better cashflow: Low upfront costs and spread-out payments help keep your cash in hand.
  • Stay updated: Easily upgrade to newer equipment or vehicles.

Here are some things to think about with leases:

  • No ownership: You don’t own ever own the asset.
  • Higher long-term cost: Over many years, leasing can be more expensive than buying.

Contract Hire

Contract hire is often used for vehicles. Contract hire is like leasing, but usually includes maintenance and servicing in the monthly payments.

Here’s why contract hire can be good:

  • Fixed costs: You’ll know exactly what you’ll pay each month, including upkeep.
  • Cash flow friendly: Like leasing, it spreads out the cost.

Here are some things to think about with contract hire:

  • Mileage limits on vehicles: Exceeding agreed mileage can cost extra.
  • No ownership: You can’t keep or modify the vehicle.

Hire purchase

With hire purchase, you buy the asset over time. You make a deposit and then regular payments. Once all payments are made, you own the asset.

Here’s why hire purchase can be good:

  • You own it: At the end, the asset is yours.
  • Predictable payments: Fixed monthly payments make budgeting easier.

Here are some things to think about with hire purchase:

  • Bigger upfront cost: Requires a higher initial deposit compared to leasing.
  • Maintenance responsibility: You’re in charge of upkeep and repairs.
  • Cash flow impact: Higher monthly payments can strain cash flow initially.

Making the decision

To choose the best option for you, you may want to consider the following points:

  • Cash flow: How much can you afford each month? Leasing and contract hire usually have lower monthly payments.
  • How long you’ll use it: If you need the asset short-term or it becomes outdated quickly, leasing or contract hire might be best.
  • Ownership needs: If owning the asset is crucial, hire purchase is the way to go.
  • Financial impact: Leasing keeps liabilities off your balance sheet, while hire purchase adds both an asset and a liability.


Choosing how to finance your new asset doesn’t have to be complicated. By considering your businesses cash flow, how long you’ll need the asset, and whether ownership matters, you can pick the best option for you.

Tax can also be a factor in the decision. For personalised advice, please feel free to contact us at any time. Our team of experts is ready to help you navigate the complexities of asset financing and find the best solution for your business.

For businesses that run as a partnership, there often comes a time where you need to consider admitting a new partner into the partnership.

Perhaps it’s a case of looking for someone who will pave the way for an existing partner to retire, maybe it’s a family business and there are plans to bring the next generation on board, or perhaps you have a key employee that brings value to the business and is looking to grow their role and status in the business.

Whatever the reason, what are some of the things you should consider before admitting a new partner? Let’s have a look.

Skills and experience

Does the new partner bring skills and expertise that complement the existing partners? This could be in finance, marketing, operations, or in some technical knowledge that is specific to your business.

Spend some time evaluating the prospective partner’s experience in your industry and how it can contribute to the growth and success of the partnership.

Financial contribution

How much capital will the new partner contribute to the partnership? Assess whether this capital is sufficient to meet the current and future needs of the business.

It also pays to check on the financial stability of the prospective partner. Will they be able to meet their financial commitments to the partnership?

Cultural fit

Things can get very uncomfortable if there’s a mismatch of values among partners in a business. While it’s not necessary to agree on everything – in fact an ability to have different ideas can be very valuable for a business – long-running disagreements or feuds can be very detrimental to morale across the business. So, consider whether the prospective partner’s values, work ethic, and vision align with those of the existing partners.

Look at how well the new partner will fit into the existing team. Healthy interpersonal dynamics are crucial for the smooth operation of the partnership.

Legal and regulatory considerations

Review your partnership agreement and update it to include terms related to the new partner’s rights, responsibilities, and share of profits and losses.

Make sure too that the new partner understands and is willing to comply with all the legal and regulatory requirements relevant to the business.

Impact on existing partners

How will the admission of a new partner affect the distribution of profits among existing partners?

Besides profit sharing, also consider how the prospective partner’s admission will impact decision-making processes within the partnership. More partners can complicate decision-making although they can also bring diverse perspectives.

Strategic fit

Does the new partner support the partnership’s long-term strategic goals? Their vision and goals ought to align with the partnership’s growth strategy.

Also, can the prospective partner bring new clients or access to new markets that will benefit or add to the strategic direction of the partnership?

Reputation and integrity

Unless you already know the new partner well, it is important to carry out thorough background checks to ensure that they have a good reputation and a history of integrity.

The reputation they have in their professional network can also benefit the partnership as a whole, so it’s worth assessing how strong this is too.

Exit strategy

However happy things are on the way into an agreement, it is always wise to ensure that you have a clear buy-sell agreement that outlines the terms for a partner exiting the partnership, whether through retirement, resignation or other circumstances.

Consider too how the admission of a new partner fits into the partnership’s long-term succession planning.


Admitting a new partner is a multifaceted decision that requires careful consideration of financial, operational, and interpersonal factors.

It’s essential to evaluate the prospective partner’s skills, financial contribution, cultural fit, and strategic alignment with the partnership. Legal and regulatory compliance, the impact on existing partners, the reputation of the individual, and an agreed-upon exit strategy are also critical components.

Conducting thorough due diligence and having open discussions among existing partners can help ensure a successful and mutually beneficial addition to the partnership.

Tax is also a consideration when a new partner joins a business. Why not ask us about the tax implications of admitting a new partner into your business? We will be happy to help you!


Data releases in recent weeks from the Office of National Statistics (ONS) coupled with Bank of England decisions might make recent news about the economy seem a bit confusing. Understanding how this news affects businesses is important so let’s break it down.

Growth in the economy

The latest reports show that the economy grew by 0.6% from January to March 2024, which is good news! It is a 0.9% increase from the previous quarter and means the recent recession seems to have reached its end – businesses generally are doing well. However, swings over a short period underscore the necessity for businesses to adapt swiftly to change.

Interest rates and prices

Despite hopes otherwise, the Bank of England decided not to change the official interest rate because of ongoing concerns over inflation.

The Consumer Price Index (CPI) declined slightly from 3.4% in February to 3.2% in the 12 months to March 2024, but remains above the Bank’s target of 2%. While inflation is falling, it has not fallen as quickly as hoped earlier in the year.

The delay in reducing the official rate has led to implications for borrowing costs, and this has been seen in the recent uptick in the prices of 2-year and 5-year fixed rate mortgages.

What this means for businesses:

So, what does all this mean for businesses? Well, it’s a bit of a mixed bag. The good news is that the economy is growing, which is generally good for businesses. But, because prices are still going up faster than the Bank of England would like, they’re keeping interest rates the same. This may make borrowing money more expensive.

What businesses can do:

With economic shifts like these, businesses need to stay resilient and agile. Here’s a few things you can do:

  • Strategic financial planning: Analysing finances, sales, and customer spending patterns can help you recognise trends. You can then work out what to do to head off potential risks or capitalise early on opportunities.
  • Keep your costs streamlined: Make sure that you’re getting value out of what you pay money out for. Cheapest isn’t necessarily best and cutting costs by switching suppliers doesn’t always make for good business, however it’s often possible to identify areas to save some costs without interrupting your business.
  • Keep customers happy: Make sure you’re offering good value for money to your customers, so they keep coming back to you. You might look at whether products or services you offer could be enhanced to appeal to more customers. Perhaps a change in pricing strategy could win more customers or be more profitable (not necessarily the same thing!). Or, maybe an adjustment to your customer care might lead to a better experience that builds stronger loyalty.

While recent economic indicators paint a mixed picture, businesses can still thrive by being smart and staying prepared for whatever comes their way.


Over the last two years, the tax-free allowance for capital gains tax has been cut by over three-quarters. For the tax year that recently began on 6 April 2024, the Annual Exempt Amount has been reduced to £3,000 (£1,500 for trustees).

These reductions mean that more and more of us are likely to be affected by capital gains tax.

What is capital gains tax?
You could think of capital gains tax as a tax you pay when you make money from selling something that has increased in value. This “something” could be anything from a house to shares or even a piece of art. So, let’s say you bought shares for £500 and sold them later for £1,000. The £500 profit you made could be subject to capital gains tax.

How much tax you pay depends on a few things. Firstly, it depends on what you are selling and how much profit you have made. Secondly, it depends on how much money you make overall in a year. For instance, if you earn more, you might pay a higher rate of tax on your gains. Thirdly, the total amount of gain you make in a tax year is reduced by the Annual Exempt Amount.

However, not all gains are taxed. For instance, if you sell your main home or certain types of investments like ISAs, you might not have to pay any tax on the profit.

Are there ways you can reduce capital gains tax?

There are a few things you could think about doing to help reduce the amount of capital gains tax you might need to pay.

• As mentioned above, the rate of tax you pay depends on how much money you make overall. If you can reduce the income you are taxed on, this might mean you can pay capital gains tax at a lower rate. One way to do this is by making pension contributions as these reduce your income for tax purposes.

• Where an asset can be separated into different parts – a portfolio of shares would be a good example – you might be able to split the sale between two tax years. For example, you might sell some shares on 5th April, and then more shares on 6th April. This could give you two years’ worth of allowances to spread your gain against.

• If you have no plans to sell off assets during a tax year, you could sell some of them to use up your Annual Exempt Amount, and then immediately buy them back within an ISA. Any future gains you make on those assets will then be tax-free.

• The Annual Exempt Amount can be combined for jointly owned assets, so you may be able to split your assets with your spouse or civil partner. You can also transfer assets between you without having to pay capital gains tax. If your spouse or civil partner pays income tax at a lower rate than you do, or perhaps has made a loss on selling other assets, this might be a way of reducing the capital gains tax you pay as a couple.

The reductions in Annual Exempt Amount mean that more of us could end up having to pay capital gains tax. However, there may be ways to reduce the amount you pay.

As experienced tax advisers, we have tools that can help you calculate what capital gains tax you might have to pay and can provide personalised advice on the steps that may help you reduce that tax. Why not talk to us to make sure you’re following the rules and not paying more tax than you need to?


HM Revenue and Customs (HMRC) has updated its guidance on what qualifies as ordinary commuting and private travel for tax purposes to include hybrid or flexible working.

Generally, where an employee works at home as an objective requirement of the job, then HMRC will usually accept that the employee is entitled to tax relief for the expenses of travelling from their home to another workplace, such as the office, when this is in performance of the duties of their job.

Usually, HMRC will only accept that working at home is an objective requirement of the job if facilities that an employee needs to do their job are only practically available at their home.

On the other hand, if an employer provides appropriate facilities in other locations that could be practically used by the employee, or the employee chooses to work from home, then HMRC will not accept that working from home is an objective requirement of the job.

HMRC provide an example to illustrate this. The work of an area sales manager living in Glasgow requires her to manage the company’s regional sales team across Scotland, but the company’s nearest office is in Newcastle. Since the manager cannot practically attend that office and is required by her employer to keep all client information securely at home, she is entitled to tax relief for her costs on the occasions she travels to the company’s office in Newcastle.

Since COVID and with the developments in communication technology, many employers now allow their employees the choice of working from home on a flexible or hybrid basis. The employee will usually have a base office that they attend on the days they are working in the office.

Since this flexible way of working is voluntary for the employee, they are not required to work from home. This means that any journeys they make from home to the office are ordinary commuting and do not qualify for tax relief.

This is important to be aware of as an employer if you reimburse staff using the approved mileage rates. You must make sure that you do not reimburse expense claims for home-to-office travel for employees who are hybrid workers by their own choice. If you do, the payment then becomes a benefit and will need to have tax and national insurance deducted via payroll.

If you are not sure about whether you or an employee qualifies for tax relief on home-to-office journeys, please feel free to call us at any time. We will be happy to help you!
See: https://www.gov.uk/guidance/ordinary-commuting-and-private-travel-490-chapter-3#employees-who-work-at-home


Free Gas Station Petrol Station photo and pictureFrom May 1st 2024, the VAT road fuel scale charges were updated. The new rates need to be used from the start of the next VAT accounting period that begins on or after May 1st. So, if your next VAT quarter starts on June 1st, you will begin using the new rates for the quarter that begins on June 1st.

VAT road fuel scale charges provide a simplified method for calculating and accounting for VAT for VAT registered businesses that pay for road fuel that is used both for business and private purposes.

Instead of tracking each fuel purchase individually, businesses apply fixed charges based on the type of vehicle and its CO2 emissions. The fixed charges are effectively an estimate of the VAT on private use.

If your business only pays for fuel that is used for business purposes, or simply reimburses business mileage to employees, there is no need to use the VAT road fuel scale charges.
The vehicle logbook or UK approval certificate should show the vehicle’s CO2 emissions figure. However, the online tool here – https://www.gov.uk/get-vehicle-information-from-dvla – can also be used to check this figure.

If the car is too old to have a CO2 emissions figure, then the CO2 band needs to be identified based on the engine size.  The new scale charges together with details on how to calculate the charge for a vehicle can be found on HMRC’s website at the link below. If you need any help with calculating the rate or you are not sure whether you need to use these charges on your VAT return, please feel free to call us and we will be happy to help you.

See: https://www.gov.uk/guidance/vat-road-fuel-scale-charges-from-1-may-2024-to-30-april-2025


Growing a business often requires capital. If you don’t have that capital personally or already in the business, then one option is to get finance from a bank.

What types of finance are available? How can you present a request to a bank and have it accepted? We will endeavour to answer those questions in this article.

Common types of finance

Financing can usually be broken down into 3 main areas: loans, leases, and hire purchase.

• Loans are usually provided by a bank and could be as simple as an agreed overdraft or a fixed term loan. There are often requirements imposed by a bank, such as securing the borrowing against business or even personal assets.

• Leases involve renting an asset for a set period rather than owning it. The initial outlay is often lower than with other forms of finance. However, if you look at the total cost, leases can work out more expensive in the long run.

• Hire purchase normally involves a finance company buying an asset and then ‘hiring’ it to you. Once you pay the final instalment you get legal ownership. Interest rates can be more expensive than for a loan, but it pays to check.

It pays to compare interest rates and look at the total cost of ownership. Loans are usually the cheapest source of finance to a business, but there can be good reasons for considering leases or hire purchase.

Matters considered by a bank

When looking at an overdraft or loan application, a bank will consider what they know about you and your business, and the experience they have of the trade you are in. They will also look at your experience with the business and how you handle your accounts with the bank.

The bank will also consider the amount of finance being requested and whether it is enough to complete the aim of the finance. They will want to see cashflow forecasts and whether other factors relating to the finance request have been properly considered. For instance, if the finance is to expand property, are planning applications needed?

A bank will also look at whether the repayment period of the finance fits with the use of the asset. For example, a 10-year loan for a laptop is unlikely to be accepted.

Banks will often flex their interest rates and fees to cover them for the risk they may feel there is in lending to you. And, particularly with an overdraft, they may want to see regular financial reports from you.

When you can show that you have requested an adequate amount of finance for what you are proposing, you have demonstrated the need for the finance, and you have up-to-date accounts and forecasts including cashflow projections, you are giving the bank plenty of reasons for confidence in lending you the money.


A new digital service has been launched that makes it easier to check if you have any gaps in your National Insurance (NI) record that may affect your State Pension entitlement.

The service is called Check Your State Pension forecast and can be accessed via GOV.UK or the HMRC app. You will need to register for or login to your Personal Tax Account to find the service.

The forecast details your NI record by tax year and identifies if there are any years that are not counting towards your State Pension entitlement. The service also shows the details of any voluntary NI contributions that you could make to increase your forecast.

The service allows you to choose which years you would like to pay voluntary contributions for and then takes you through to a secure payment facility to make payment.

If you think you may have gap years in your contributions, it is important to check sooner rather than later. Because of new State Pension transitional arrangements, the deadline for paying voluntary NI contributions was extended to 5 April 2025.

HM Revenue and Customs (HMRC) is running a campaign to help people avoid being caught out by tax avoidance schemes. This is particularly relevant to those who are contractors, agency workers, or are working through an umbrella company.

Tax avoidance schemes are schemes designed to bend the rules of the tax system in a way that was not intended. They usually involve contrived transactions whose only real purpose is to artificially reduce the amount of tax someone pays. It is different from effective tax planning.

Being caught out by a tax avoidance scheme can be expensive. People who use them often end up paying interest and penalties in addition to the tax they should have paid. This is on top of the fees that may already have been paid to the person who sold the scheme.

Therefore, it makes sense to check your working arrangements and contract to make sure that you do not get caught up in a scheme that might land you a big tax bill somewhere down the line. This applies whether you are being considered as self-employed or employed.

Red flags include receiving more money in your bank account that what is shown on your payslip, or receiving untaxed payments that are described as loans or capital advances.

You should be especially careful if a scheme is described as ‘HMRC approved’ since HMRC does not approve schemes.

HMRC provides a risk checker tool that you can use to find out if your employment arrangements might involve tax avoidance. This can be accessed here: https://www.gov.uk/guidance/check-if-you-are-at-risk-of-tax-avoidance

We are expert tax advisers and can help you with effective tax planning, however please be assured that we do not offer tax avoidance schemes. If you think that you may have been caught out by a tax avoidance scheme and would like some advice, please call us and we will be happy to help you.

See: https://dontgetcaughtout.campaign.gov.uk/tax-avoidance/


HM Revenue and Customs (HMRC) has published guidance on a new online service to help businesses with their import duties and VAT accounts.

If you or your business are involved in importing goods into England, Scotland, Wales and Northern Ireland, you can use the new service to:

• Get your import VAT statements and certificates;
• Manage your payment accounts; and
• Manage or view authorities.

This new service should help to bring everything you need into one place.

To use the service, you need to have a Government Gateway user ID and password, and you must be subscribed to the Customs Declaration service. If you need any help registering with HMRC, please do not hesitate to contact us! For more information and to log in, please see: https://www.gov.uk/guidance/manage-your-import-duties-and-vat-accounts