Crowdfunding: A useful tool for navigating sources

Screen Shot 2013-05-21 at 22.17.22With a new crowdfunding platform emerging seemingly every week, it has become increasingly difficult to keep track of them – let alone their particular business model, approach and fee structure.

NESTA has released a timely online platform that provides a useful summary of the key features of the various crowdfunding platforms available right now.

There are some useful filtering tools plus some high level tips and additional information for founders seeking funding and potential investors. It may have been helpful for the site to list a little more info on SEIS / EIS funding opportunities given the extra kick starter this can provide for UK businesses.

Overall, I hope this site is maintained as it should prove to be a useful resource.

Click here to access the platform.
[contact-form-7 404 "Not Found"]

Enhanced by Zemanta

Fancy playing Business Card Roulette?

RolodexSo just imagine, we meet at a networking event and you proudly pass me your business card. I reach into my inside jacket pocket and pull out a bundle of assorted business cards – some slightly dog-eared and others like new – and wriggle one out from under the tightly bound elastic band.

I pull a pen out of my other pocket and proceed to scribble my name, number and email address on the card.

This was evidently someone else’s card that had previously been passed to me.

I proudly hand over my DIY business card commenting:

“Here are my hand-written contact details – I prefer to recycle the business cards I’ve received to keep the owners’ contact details in constant circulation; you never know, you might find them useful too. If you do, please let them know that I passed on their details – in fact, if it’s not too much trouble, why not drop them a line anyway? Their card was the first one I picked for you so fate might deal its hand to your mutual advantage (again)….”

Think of all of those business cards languishing in drawers or under desks that could be brought back into service. If you’re anything like me you will have used the business cards to connect on Linkedin and now have no need for the card itself.

Business Card Roulette could hold the key to increasing the leverage from the endangered business card whilst also allowing for some random acts of kindness and serendipity.

This is an idea inspired by a reference made in Blake Mycoskie’s excellent book, Start Something that Matters – Blake of TOMS Shoes fame.

How’s about it? Fancy starting a [business card roulette] movement!

Let me know how you get on.

#businesscardroulette #bcroulette

Image credit: Creative Commons License Ged Carroll via Compfight

Enhanced by Zemanta

Patent Box: shows UK is open for international business

My Kinda Town

The new Patent Box tax incentive is phased in this month allowing qualifying companies to claim a beneficial rate of corporation tax of just 10% (by 2017) on worldwide profits derived from qualifying patents.

Responses from UK business so far has been disappointingly muted so its good to see that this new relief is attracting the attention of overseas companies who may now take the UK seriously as a location to set up new ventures – particularly hi-tech businesses.

See this extract from David D. Sprague of Baker & MacKenzie LLP in Palo Alto CA:

“What makes the U.K. patent box particularly interesting for U.S. multinationals is that the United Kingdom has always been a logical base of foreign operations for U.S. groups.  For example, the U.S. high-tech community has found the United Kingdom to be an attractive jurisdiction in which to locate regional management headquarters, and some English industrial parks look like they have been transported from Silicon Valley. Advertising-supported internet-based businesses are particularly attracted to the United Kingdom, as London remains the region’s preeminent center of the advertising business.

So if the United Kingdom can get its patent box right, there is a real possibility that some U.S.-based internet and similarly situated businesses could see reasons to consolidate more activities in the United Kingdom, even making their U.K. group entities the central economic entrepreneur for their offshore structures.”

If we manage to pull this off and attract exciting new businesses and jobs – this would be a great result for the UK.

In the meantime, if you are a start-up, growing business or more mature SME – please don’t overlook the Patent Box, especially as it’s right on your doorstep!

 

image credit: Trey Ratcliff via Compfight

Enhanced by Zemanta

£1m benefit of being a tax aware entrepreneur

EuphoriaMark knew that his new business would be at the cutting-edge of technology and potentially even a world-player – exactly the sort of business that the UK Government is keen to promote and support in the form of tax incentives.

Fully aware of the opportunities that the UK tax code provided for releasing cash into his new venture, Mark kicked off by raising an initial £150,000 under the Seed Enterprise Investment Scheme (SEIS). A 50% income tax break for the investors made it easier to nudge up the cash they were willing to part with; plus the opportunity to sell their shares after three years – capital gains tax ‘free’ – made the investment even sweeter. Mark had pondered utilising this tax break on his own £10,000 investment into the company but decided that, on this occasion he wanted to retain more than 30% of the share capital (which precluded him from SEIS) – maybe next time…

This SEIS cash would be used to fund the R&D phase in employing a small team of developers. Given that the company was pre-revenue, Mark was able to claim a welcome tax refund from HM Revenue & Customs under the SME R&D tax credit scheme. This released in excess of £30,000 into the business which was promptly used to fund a further developer outside the SEIS funds to accelerate the project.

Having made significant inroads on the R&D work (whilst burning through in excess of 70% of the SEIS cash!), Mark approached investors for a further round of funding – this time under the Enterprise Investment Scheme (SEIS’s ‘big brother’!). A 30% income tax break this time for investors (plus potential for a capital gains free exit) provided sufficient enticement for investors to inject a further £2m into the company.

Meanwhile, whilst the R&D work was ongoing, Mark had made investigations regarding the potential for filing one or more patents on aspects of the underlying invention generated by the R&D work. With the arrival of the new Patent Box tax incentive from 1 April 2013, Mark knew that a 10% corporation tax rate by 2017 on worldwide income derived from qualifying patents could add additional value to his company as it approached an exit as well as releasing further much needed cash into the business from now until then.

Eyeing an exit in 3-5 years time, Mark ensured he retained at least 5% of the share capital post dilution at each funding round in order to secure a capital gains tax rate of just 10% on his first £10m of gains. His SEIS and EIS investors should be extra happy with a 0% capital gains tax rate after three years!

All in all, Mark had pulled the relevant statutory tax incentive levers to maximise the release of cash into his business at each stage of its life-cycle. What was this worth? It depends – the SEIS, R&D and EIS savings total approximately £700,000 but assuming a profitable few years under the the Patent Box and taking into account the above savings it is not difficult to reach overall pre-exit cash tax savings of £1m+.

Getting advice from the start can get you on the road to being a tax aware entrepreneur…

image credit:Creative Commons License Hartwig HKD via Compfight

Enhanced by Zemanta

EIS or SEIS – You decide!

HM Revenue & Customs kindly provides companies with a form that can be used to apply for advance assurance that a company is a qualifying investment for Enterprise Investment Scheme (EIS) or Seed Enterprise Investment Scheme (SEIS) purposes.

Obtaining such assurance in advance of a share issue under either scheme is highly valuable to prospective investors – in fact, most sophisticated investors will insist upon sight of such an assurance before parting with their cash.

But there is a problem with the form – its dual status means that if you simply fill it out without specifying which of the schemes you are applying under then you are leaving it to HMRC to guess which you are after – which isn’t the best plan in a formal tax clearance!

Admittedly there are a couple of tick boxes that relate specifically to SEIS but you would be well advised to draft a separate letter spelling out your requirements or seeking professional assistance – after all the difference between 50% income tax relief and 30% could free up extra investment for your fledgling company.

Enhanced by Zemanta

Can my tech company claim 10% Patent Box relief on software?

The new beneficial Patent Box rules will be introduced with effect from 1 April 2013 and it is important therefore that companies consider how they might benefit from a 10% corporation tax rate.

There is a common misconception amongst tech companies that software cannot be patented (although this misconception is understandable when you take an initial look at the relevant patent law…)

UK patent law excludes:

‘a scheme, rule or method for performing a mental act, playing a game or doing business, or a program for a computer’

from constituting inventions for the purposes of filing a patent; however, the legislation subsequently offers a small crack of light for tech companies by limiting the application of this exclusion.

To understand more we need to refer to relevant case law and this has evolved to the stage where software can be patentable in the UK and Europe where it can be demonstrated that the software or coding makes a technical or inventive contribution to ‘human knowledge’. In effect, we look beyond the fact that the invention is a computer program to the underlying technical contribution or technical solution that it brings about provided it is novel and inventive.

For example, consider a software program that allows imagery to be digitally enhanced or improved. This could be patentable if it can be demonstrated that the technical problem that has been overcome is novel or inventive and therefore results in a contribution to ‘human knowledge’ – it just ‘happens’ to have been achieved using a computer program and therefore this should not preclude a patent. You can envisage software that can solve technical problems for physical hardware e.g. speed of data transfer, as well as solving technical problems related to the software all of which could be patentable.

Both the UK and European patent offices grant patents for software in cases where the facts fit which is crucial for the purposes of claiming the benefits of the Patent Box. The US rules are of little assistance to us here as a US granted patent will not qualify for the Patent Box.

Incidentally, if you find yourself pursuing patents to protect your idea and benefit from the Patent Box – don’t forget about R&D tax credits!

Enhanced by Zemanta

R&D tax credits: Need to know tax tips for entrepreneurs (webinar)

In this free webinar, Steve Livingston (Founder & MD of ip tax solutions) walks Founders and Entrepreneurs through the basics of the UK R&D tax credit incentive.

This is a ‘back to basics’ seminar for company founders / entrepreneurs who would like to learn more about the Research & Development tax incentive and whether it might apply to their business.

We cover:

  1. What it is and why it was introduced
  2. An overview of the (generous) tax benefits
  3. What companies qualify and qualifying costs
  4. The process for making a claim to HM Revenue & Customs
  5. Why you should consider this incentive for any business
  6. Q&A

This free webinar lasts 55mins

Steve Livingston is a chartered accountant and experienced tax advisor to entrepreneurs. He is also the founder of ip tax solutions, specialists in advising fast growth companies.

If you enjoyed this post, get email updates (it’s free).


Enhanced by Zemanta

EIS / SEIS: Navigating traps for the unwary (webinar)

  • Are you an entrepreneur or company founder seeking funding? 
  • Have you considered the benefits of the Enterprise Investment Scheme (EIS) or Seed Enterprise Investment Scheme (SEIS) to attract private investment from individuals and business angels? 
  • Or are you a prospective EIS / SEIS investor?

If you answered YES to any of the above, this FREE webinar may be for you. 

In this 45min webinar, Steve Livingston, Chartered Accountant and experienced tax advisor to fast growth companies walks participants through:

  1. An overview of the EIS / SEIS schemes
  2. Does my company qualify – common areas for concern?
  3. How to get advance assurance from HMRC and why its important?
  4. Common investor stumbling blocks
  5. Practical issues in structuring the investment to ensure it qualifies
  6. I’ve received the funding – now what?
  7. DIY – How wrong could this get,,,,,?

This seminar aims to provide entrepreneurs and company founders with an overview of the common stumbling blocks encountered in raising EIS / SEIS fundings so that they can maximise funding opportunities and help ensure that their investors’ tax position remains protected.

You will ideally already have an understanding of the basics of EIS / SEIS, although not essential.

To find out more about ip tax solutions visit our site: www.iptaxsolutions.co.uk

If you enjoyed this post, get email updates (it’s free).


Enhanced by Zemanta

When tax planning can be good!

Life is a precious gift. Don't waste it being unhappy, dissatisfied, or anything else you can be

Tax planning is getting a real battering at the moment – in some cases, for all the right reasons – but there are many instances where effective tax planning is essential for fast growth businesses and, in fact, positively encouraged by the government.

Aside from printing money to erode away much of our UK budget deficit (…), the Government appreciates that by encouraging entrepreneurs to build hi-tech companies here in the UK then we might have a fighting chance of seeing a brighter economic picture in the short-medium term.

To help us achieve this, the Government introduced 5 key statutory tax incentives that they absolutely and positively want entrepreneurs to claim:

  1. Enterprise Investment Scheme (EIS) / Seed Enterprise Investment Scheme (SEIS)
  2. Enterprise Management Incentive Scheme (EMI)
  3. R&D tax credits
  4. Patent Box
  5. Entrepreneur’s Relief 

As a chartered accountant specialising in advising fast growth companies in these areas – you can find plenty more about these tax incentives on this site or by getting in touch – in my view:

If all UK entrepreneurial businesses took advantage of these five statutory tax incentives (where applicable) and used the funds saved to reinvest in new jobs, new marketing channels and new business ventures; then surely we could reinvigorate our economy with fresh, innovative ip rich companies that can compete on a global scale

Enough of the ‘tax bashing’ – let’s make sure that our entrepreneurs have all of the tools necessary at their disposal if they are to get us back on top – an effective and supportive tax regime for entrepreneurs is one of them (and the good news in the UK is that – for now – we have one…).

Image attribution: @Doug88888 via Compfight

Enhanced by Zemanta

10 benefits of working with a cloud accountant

  1. We  work together on the same figures – working in real-time.
  2. We can step in and advise early if something looks amiss or where there’s a potential planning opportunity.
  3. You know where you are in terms of business performance now. Today. This week. This Month. And so can act upon it.
  4. We can work at your pace and share our work progress in shared secure online drives – transparency reigns!
  5. We can work together anytime, anywhere. Whether you are in London, Cornwall, Bristol, Aberdeen or closer to home in the north west. Location really doesn’t matter to access the best accountancy services today.
  6. We will always be working on the latest versions of our accounting, CRM, etc saas based software as they can be updated by the service providers online. No more waiting for CD ROM patches and updates.
  7. The days of attempting (and often failing!) to email large files plus the potential for confusion over latest versions are long gone. We handle all data securely in the cloud which makes everything much easier.
  8. New tech add-ons are released regularly to further streamline processes and reduce admin.
  9. Year-end accounting work becomes a formality rather than an information sharing event – there should be no ‘news’ at your year end.
  10. We can now truly become an extension of your management team.

So what are you waiting for…..?

Enhanced by Zemanta