Tax and VAT advice, pricing strategy for Consultants

Business structure, tax and VAT advice

Consultants, Nottingham

This client came to us in a mess thinking they would go bankrupt.  We set objectives to address their challenges:

• Protect personal assets due to an ongoing VAT concern.
• Reduce tax burden to release much needed cash flow.
• Register for VAT.
• Adopt a strategy to increase prices.

We:

• Transferred trade to limited company, protecting future liabilities in worst case.
• Put HMR&C payment plan in place.
• Advised on packaging products so clients would not be deterred by steep rises (due to VAT registration) and inclusion of consultancy fee to reflect service provided.
• Reviewed profit by venue resulting in removal of one venue and annual cost of £7k.
• Reviewed hours spent on the road by Directors and refocused on more use of home office.

Performance improvements:

• On incorporation payments on account for personal tax refunded by HMR&C releasing £31k into working capital, for 21 months.
• Effective rate of taxation dropped from 31% to 21% saving £25k.
• Price plan implemented, over 99% of customers retained.
• Gross margin increase of 7%pts.
• Travel costs and overheads reduced by £12k pa.
• Earnings per hour increase of £6.17 YoY.

 “We were lost…when we first came to see you we did not fully realise how poorly our previous accountant had handled the business. With your help we have made huge savings and are now in a better ‘place’.”