How to find your USP – and why Making Tax Digital can improve how you run your business

In the depths of postnatal depression, Samantha Senior, the founder of The Aesthetics Accountant and SAS, Senior Accounting Services, found herself “scouring the internet to change how she looked”.

Unexpectedly, her research led her not to Botox, but an entrepreneurial lightbulb moment that injected the passion back into her life.

This episode is stuffed with advice for both small business owners and accountants, including what you need to know about Making Tax Digital.

Here are the topics we cover:

Dark days can lead to business breakthroughs

This is what a VAT inspection involves

How to go from niche product seller to market leader

Coping with tax returns and making a loss

Don’t wait until you’re profitable to buy accounting software

Making Tax Digital: What you need to know as an entrepreneur

How to educate clients about Making Tax Digital, as an accountant

If you use spreadsheets you are not Making Tax Digital ready

How Making Tax Digital can help grow your business

Why a small business below the VAT threshold, might become a VAT registered business

Having your figures in real time helps make tax and business decisions

How a good accountant can save you money as a small business owner

What is super deduction and who is eligible?

A good accountant reduces clients’ anxiety

Dark days can lead to business breakthroughs

Bex Burn-Callander:

I’d love to hear a bit about your journey. So, obviously you’re an accountant, but you’re also an entrepreneur.

Can you tell me a bit about how you ended up founding your own practice? In fact, not just one but two.

Samantha Senior:

My first practice I’ve had for many years, and it was just an accounting practice, where we took different businesses, small and medium. Not so much large, but it was more bookkeeping, Self Assessment, that kind of thing.

The other company came off the back of some quite dark times.

I think I’d had my second child, and during the pregnancy of the second child, I became very ill. I had post-natal depression and I just lost my heart for work.

I didn’t want to work. I didn’t want to go back to work.

And that’s hard when your only income is coming from accountancy, and you’ve got clients who need you.

I think it was off the back of having post-natal depression, I started looking at myself. I was ageing, I was 40-something and I was looking at Botox and fillers.

With that, I then looked at where I would go to have these Botox and fillers.

And I realised that when you look at the entire market, it’s unregulated, it’s unsafe.

You can go to somebody, and they might not have the qualifications, or they might have qualifications, but they can be injecting all sorts into you.

So on the back of that, I started doing a lot of research on, predominantly, where I would find an injector.

That’s where somewhere along the lines, my accountant head must have come into play, and I realised that the VAT in the industry is just so complex and, that’s where The Aesthetics Accountant came from really.

It came from me being in such a dark place, that I was scouring the internet to find someone to change how I looked, because I just felt so down and ill, that I was wanting to change how I looked, and it went from there.

We did, at the time, on the other business, have a few aesthetic injectors on there that were businesses.

So, we already had an idea of what the business needed, and what accountancy aspects they needed.

But it was the VAT, they weren’t VAT registered.

It was the VAT side of it that we then started looking at in more detail, and I got my passion back for accountancy.

At that point, The Aesthetics Accountant was just a division of the old practice, which we still have both practices.

And then over the last few years, it just grew and grew.

Because of what we do, it’s quite niche, so we were then contacted by businesses that were in the middle of the VAT inspections, and then needed help with the VAT aspects, and we helped with those.

We gained valuable knowledge within those investigations. And then that’s when we set up The Aesthetics Accountant, as a separate company and it’s been from there.

We also run masterclasses to the industry, teaching them so they understand what they can claim as VAT, and what they can’t claim as VAT exempts.

It’s given me my passion back.

Although it did come from a very dark place, it is a very happy place.

We work with some of the best doctors and best nurses in the world. They’re brilliant, they’re doing some amazing things. It isn’t all big lips and stiff faces. What they are doing is just revolutionary and it’s great to be a part of.

I get to speak at events, I get to sit there and advise doctors on what they should be doing with their VAT.

To be fair, I’ve not actually had any Botox or filler yet. So, it did come out of somewhere very dark.

I think everything happens for a reason, and if I look back to where we were, when I started looking at it, I would never ever have imagined this.

Bex Burn-Callander:

When you say I haven’t had any Botox or fillers yet, well, clearly if you change your mind, you’ve got an amazing client list of people.

Samantha Senior:

Yeah, I know where to go.

Bex Burn-Callander:

They would make you look the best or give you the best service at least. So you’ve definitely got the right people around you.

You don’t need fillers or Botox by the way, Sam.

Samantha Senior:

That’s just another example of how ill I was, and this is another interesting aspect about the industry, a medic won’t treat somebody with body dysmorphia.

I was obviously having a breakdown of some sort.

I was very ill, it was post-natal depression, but it has led to something beautiful in the end. But we’ve come out with that and it’s brilliant.

At the end of it, we’ve got a brilliant company and it’s going really well.

This is what a VAT inspection involves

Bex Burn-Callander:

And you mentioned a moment ago that you found a lot of clients who were going through VAT inspections. I’m sure a lot of people listening might not know what those are or what they involve.

Do you want to tell us a bit about what that entails?

Samantha Senior:

In the industry predominantly, there’s a huge misconception that medics don’t need to pay VAT.

As accountants, we are generally taught when we look at medics, that their supplies are exempt.

The complexities of the industry mean they are medical professionals, but they are doing cosmetic treatments. That supply, that treatment, then becomes VAT-able.

So, if they’ve got that bit wrong and they charge an exemption, they will have then claimed the exemption on those cosmetic treatments.

So they should have paid that VAT and they haven’t.

When that happens and you’re dealing with thousands of pounds, HMRC aren’t happy, they want their thousands of pounds back and they come in and they look for it.

They’re not deliberately deceiving HMRC, it is understanding the two-part rule that HMRC sets out and understanding that if it’s a cosmetic treatment, and it’s not to protect or maintain a patient’s health, then they’re not allowed to have that exemption.

And that’s why we have designed courses that help them understand that.

The industry itself is still in its infancy, we have to help HMRC as well because we’ve got numerous treatments coming into the market.

Some are cosmetic, some are medical. But it’s not just whether the treatment is medical or cosmetic, it also depends on what the patient needs the treatment for.

So, if somebody’s walking off the street, and now Botox and fillers are as common as going in and getting your nails and lashes done.

If somebody just wants a bit of Botox or some filler, that is cosmetic, even if it’s a medic doing that treatment.

It’s getting that information out there, which we’re doing to make sure people don’t end up in VAT inspections.

Bex Burn-Callander:

And are you really rare in terms of the accounting industry?

Are you the lone aesthetics focused accountant, or is this a growing niche?

Samantha Senior:

There are definitely people before me who’ve done it and we are doing it differently to them.

We don’t want to get to VAT inspections. We’re doing prevention rather than cure.

So there are other accountants out there. There is a particularly good one in Scotland whose work is fantastic.

But yeah, it is quite a niche market that we’ve found and it’s all going well. Yes.

How to go from niche product seller to market leader

Bex Burn-Callander:

You’ve become a market leader in your region. You’ve become really well known for this particular specialism.

Can you tell me how you’ve grown your business?

How have you gone from this light bulb moment to then helping out with a few VAT inspections to then becoming a leader?

Samantha Senior:

What’s grown us so fast is word of mouth from the client, by doing a good job and helping them.

The first VAT inspection that we did was during coronavirus and the clinic, because of the coronavirus rules, was shut down like all the clinics should have been.

We did a lot of that work, and we didn’t charge for that work, because it was heartbreaking.

I think what has put us where we are in the market, is the fact our clients continuously talk about us and recommend us. So each client that we’ve worked with, a year ago, has now brought at least five or six different clients in, and that’s why we’re continuously growing.

Another reason that we’re in the position that we’re in, is that we’ve had help from certain teams within the industry.

One is the Aesthetics Entrepreneurs, which is a group of business coaches. They’ve been incredible at supporting us.

They come to us with their students and practices, and they come and asked us for advice.

We also write for medical journals, such as Aesthetics Journal, we’ve just been around.

So we’ve had a lot of opportunities to push ourselves to where we are.

On the back of coronavirus, we were digitally ready.

I’ve always worked at home around my children. I’m a single mum, so I’ve pushed and pushed for many years to have a completely digital practice.

When coronavirus hit, we were ready, we were already there.

I’ve worked around my children for years and been told I couldn’t, and I wasn’t professional because I had kids in the background. Suddenly, coronavirus hit, and I think that gave us the advantage.

We are a predominantly woman-run business and I think that has pushed us further.

Although, we suffered financially during the pandemic, because our clients were completely shut down, so we lost a lot of contracts that were about to start at the beginning of coronavirus.

So financially we took a huge hit and it’s going to take us long time to recover from that.

But we are growing client-wise and we’re standing in the market as a market leader because of the support of our clients.

Coping with tax returns and making a loss

Bex Burn-Callander:

Were you able to ride through coronavirus? Did you have financial buffers in place?

Because that’s what accountants always tell their clients.

So is that something that you followed?

Samantha Senior:

Yeah, I think mine was more being a single mum. I think for me being a single mum, being in a lockdown, you can’t do a lot.

So I am always full of reserves, my garage is full of reserves.

Financially, I don’t think anybody could have prepared for the financial loss that we’ve encountered.

The other unfortunate thing about being a woman and a single mum during coronavirus was that the timing of my maternity leave.

And being ill meant the last three tax returns that I’d actually submitted, as an entrepreneur, because I was off sick and I was on maternity, we’d made a huge loss.

I was still paying the overhead for the business, I was still trying to work as well. Even though I had post-natal depression, we made a loss in those years.

So for my tax returns for those years, obviously when the grants came into play, I was on maternity leave for the first one, I was ill for the second one.

The loss was huge.

So we weren’t actually entitled to any grants. We didn’t have buffers. But I feel that we got through it and we got through it by giving accurate advice.

We also set up a free support group and I called in favours.

I had some of the best lawyers. I had Endeavour Partnership, Stephen Elliott was working on that with me. I called in some great professionals on that team as well.

There was so much bad advice going out into forums, when coronavirus first hit, about grants, that we made sure everything we put out there was fact checked.

We had about 800 businesses on there at that time.

So we took the hit, we did a lot of work for free and we are still financially paying for that. But I think it’s business and that’s part of being an entrepreneur and you’ve got to hit.

So yeah, financially it has been hard.

Bex Burn-Callander:

But it’s great advice for any entrepreneur, all of this, because you’re talking about basically contributing to trade press.

For any B2B company, that is a useful route to finding new customers.

To team up with industry organisations that have complementary client bases that you could help each other out, that’s also great advice.

And also to not be afraid to give some advice for free, because nothing converts a customer like good advice freely given where you think, wow, if this is how you’ll help me and I’m not even a paying customer, I feel like you’ll do an amazing job for me when I am a customer.

Samantha Senior:

I feel it’s also about ethics. I think we are guided by our strict code of ethics.

Personally as well as professionally, we obviously have a strict code.

But personally, it was ethical to do what we did, during coronavirus. I think when you’re watching business owners having to shut the businesses and then in the middle of VAT inspections as well, and you’ve watched them pay huge amounts of tax for years, I just think we did the ethical thing.

Bex Burn-Callander:

Always the right approach.

Samantha Senior:

Yeah, and that’s also as a business, I think that’s true to our standing. We’ll hopefully make the money back one day, but that’s not our biggest gain at the moment.

Don’t wait until you’re profitable to buy accounting software

Bex Burn-Callander:

Can you tell me any things that stand out for you in terms of best practice things that every startup founder should look at around their tax, around their numbers, that really stick out for you?

Samantha Senior:

We want everybody to get software to online banking and get on accounting software, and a lot of people do put this off.

And like you say, between years one and three, it’s a crucial time and people think, I’ll wait.

They don’t consciously want to wait until year three, they just have it in their head, and think I’ll wait until I’m profitable. I’ll wait until I’ve got huge amount of money in the bank, and then I’ll get an accountant.

Or, then I’ll open a business bank account.

It’s all just juggling, which is fine, it’s part of business to be juggling, but if you have that structure and that financial structure behind you, such as getting the accountancy software, getting a business bank account, having everything into one bank account, having your bookkeeping, even if you’re doing your own bookkeeping.

Having those systems and structure, that’s the foundation, because then when you do come to see an accountant, you’ve got that from day one.

The great stuff about software now, is you can have everything in real time.

So rather than sitting down with an accountant at year two or three and saying, “Right, that’s my mess and this is where I’m at and I’ve got this, and I’ve got that, and I’ve got this.”

We could actually give better advice at that point if you’ve kept these records and you’re utilising that time with your accountant because they can give you the answers that you need straight away.

What we offer is a service with The Aesthetics Accountant, more so than the other, because with the aesthetics industry, like you say, with normal businesses between year one and year three, there is a struggle.

Aesthetics are different.

Within a year, they can quickly be turning over £150,000 and it can just go like that. It’s so quick how it happens.

They can start by being part time at the NHS and then within months they’re booked up and earning phenomenal amounts of money.

If they’re not on software and we’ve got to start looking at what to do now, you are almost going backwards before you can even start going forwards.

And that’s why we have an academy where we bring both beginners and new businesses into the industry, and we get them on business banking straightaway.

We get them on accounting software. We set that up for them.

We let them do their own bookkeeping. We have it all ready.

Then, when they do come back to us, rather than us not being able do anything, it’s all there ready. Then we can help them through that practice.

Also when they are quiet, they can build the systems that they need and the foundation correctly.

And then when they are busy, that system is in place, and it works.

That’s what we’re finding. People don’t come on board as clients, at the moment they’re coming on board, taking our software, taking our advice, and then they’re setting up, and off they go.

And then they come back to us when they’re really busy and they just want some bookkeeping doing and we take over.

At that point, they’re like, “Oh my days, I’m reaching the VAT threshold.”

Or, “I’ve got money in my bank. What do I do?” and we can advise on tax, and then we go from there.

So that’s my biggest piece of advice for anybody, whether you’re starting up in any industry, just get the software, get the business bank account set up.

Even if you don’t go on the software, get a business bank account and keep everything separate.

Then that’s the foundation, it all just lies around the foundation.

Bex Burn-Callander:

That’s great advice.

Making Tax Digital: What you need to know as an entrepreneur

Bex Burn-Callander:

Wow, who knew that aesthetics was such a gold mine? That they’re making hundreds of thousands in their first year?

I feel like we’re going to have a few medically minded listeners thinking, maybe time for a change.

Samantha Senior:

It’s the same in the beauty industry, we’re so under looked and during the pandemic, the medical aesthetic industry, and the beauty industry, were hit hard.

When you look at the figures that these industries are making, and these are women-run businesses as well. There are a lot of men in my industry too, but there’s a lot of women doing it.

And yeah, we took a massive hit and it’s been hard.

Bex Burn-Callander:

That’s great advice about getting the foundations in place.

And actually it’s not going to be just a nice thing to have, because the government have made some changes, that mean it’s going to be mandated soon that we do have digital records.

Tell me about Making Tax Digital. What does it mean for businesses?

Samantha Senior:

So Making Tax Digital for VAT has already come in for anybody who is over the VAT threshold.

Businesses that are under the VAT threshold but that are registered for VAT, they have up until April (2022) to get this sorted and ready.

Making Tax Digital is just ensuring that you are on software and you’re submitting your returns via digital software and getting those records digitally and then submitting the returns through that.

Essentially, what the new changes are, although we are doing this for VAT already, we will be doing this for income tax in 2024 and corporation tax in 2026.

What is happening with the income tax for example, when that comes into play, is that when you are self-employed, you’re used to submitting a yearly tax return.

When Making Tax Digital (for Income Tax) comes in, that will go from being every year to every three months, and every three months you will have to submit a return. Then at the end of the year, you’ll submit a fifth return.

So, that is going to completely change your relationship with your accountant.

Or if you are doing those returns yourself, it means every three months you are going to have your information in real time, ready to submit and send it to HMRC.

So it is changing, in 2024 it will be here.

It sounds like a long way away, but it’s not.

All our clients are on the software. We’re pushing everybody on to it now, because I’ve been an accountant for many years, and I know when this happens it will go wrong.

We are working with people like Sage, AutoEntry. AutoEntry have offered us free training for all our clients, which is brilliant because it is such a great tool to be using to collate the receipts.

So what AutoEntry does, if you’re not aware of AutoEntry, is it collates all the receipts, whether that’s paper receipts, or you’re scanning uploads from emailed receipts, and it’ll takes care of it all.

That then sends it straight through to the software and then you’re compliant with everything that HMRC needs and wants for Making Tax Digital.

They won’t have a lot of impact on paying for this software.

Roughly, what a clinic would use in my industry, you’re probably paying between £10 and £20 a month. It’s not a lot of money.

Obviously in different industries, you’ll be using different suppliers and you might have lots of supplier invoices.

Having something like AutoEntry, might be a bit more expensive, but it would accurately record the data for Making Tax Digital, which in the long run is what you want.

How to educate clients about Making Tax Digital, as an accountant

Bex Burn-Callander:

What have you done, Sam, when you’ve had clients that are resistant to software and making that change?

Because there must be people who are just like, “I like my system, I like doing my spreadsheets.” Or whatever.

What conversation do you have to try and change their mind and how tricky is it?

Samantha Senior:

For my other business, we do have a few tricky businesses. And it’s not that they’re tricky or being awkward.

For example, if you’ve done a plumber’s accounts for years, and they’re used to having that relationship where they just give you a bin bag of receipts and you scan it all in there and you do it for them, they’re just used to that service.

Especially people who are coming up to the retirement ages, they’ve got to learn all these new skills and it is hard.

But again, it’s having that relationship.

You’ve got to go back, and you’ve got to talk.

You’ve got to explain that this isn’t something that you are making them do. This is something that we have to do.

And the sooner we do this, the better.

And getting them the training with AutoEntry and showing them how easy it is, is brilliant because although a lot of people might not be computer literate, but they do have mobile phones.

And especially during coronavirus, people who might not have been so keen to use software are now using software to FaceTime their children and grandchildren.

So they’re a bit more approachable about the idea of saying, look, if you come in with your smartphone, we can help you with this.

We can do this over Zoom, and we can set it all up.

And I think that’s another benefit of Covid, it’s making those conversation easier. We can say, you’ve already got this phone, now this is what we need to add to it, and we can show you how to sit there with your receipts, and you can manually do it.

I think it’s breaking down those barriers, making something that sounds quite scary, into something quite simple.

And it is simple.

It’s a lot easier to sit there and do digital receipt recording, than it is to input everything, like we had to in the olden days.

You’d have to input all the bank statements and input all the receipts. It is a lot easier to use something like AutoEntry, and then put that into your accounting software.

Bex Burn-Callander:

Yeah. That’s great advice.

If you use spreadsheets you are not Making Tax Digital ready

Bex Burn-Callander:

Are there any particular details about this shift to our new world, with Making Tax Digital, that people should be aware of?

I read somewhere for example, that if you are on spreadsheets, you can’t just copy and paste whole spreadsheets into your software.

You have to do it all direct into the software rather than trying to do your own thing, hack it and then put it in. What would else should people be aware of?

Samantha Senior:

It’s just getting it clear to people, because I think rather than having to explain to people who are computer illiterate, it’s harder to get those businesses that are reliant on spreadsheets.

When someone loves their spreadsheets, they love their spreadsheets, and you can’t get them off them.

And that’s coming from someone who loves spreadsheets, and it took me a lot to move to AutoEntry.

So you cannot use spreadsheets.

You can if you invest in bridging software, but it’s just not worth it.

I would move away from spreadsheets now.

I’ve got one particular client who loves spreadsheets, and we end up spending a lot more time extracting the information because you can’t copy and paste it.

That’s why people love spreadsheets because you can copy and paste information across.

But for Making Tax Digital, it means that you’re not compliant and then you’re not doing things correctly and that’s where the problems start.

So if you are using spreadsheets for your own data, that’s fine.

But you do need to get into software, and that’s what I can’t stress enough, you do need to move away from spreadsheets.

Bex Burn-Callander:

I feel like the message is loud and clear.

If you’re using spreadsheets, stop now.

Sam will help you, give her a shout.

Samantha Senior:

Before coronavirus I was aware that people weren’t using things like AutoEntry, and I was still shocked then. I’d be very shocked to see this now, post-coronavirus.

I don’t think there are many old school accountants left anymore, that are still not using brilliant software.

How Making Tax Digital can help grow your business

Bex Burn-Callander:

So we’ve talked about the extra work it’s going to take to embrace Making Tax Digital. But tell me about the benefits.

Why are there reasons to be cheerful for business owners? Why is it great to have such a tight grasp of your numbers the whole year through?

Samantha Senior:

The benefit of having your numbers accurately in real time, is we can offer business advisory services, which we do for our clients anyway. And we have it in real time.

If you are not utilising that skill that an accountant can bring you, it’s just a waste because you’ve got all those numbers and we can then see from the numbers what can you do with them.

We can take you from A to B. And this is a service that we offer our clients.

It’s about growing them from where they are now, to where they want to be.

We’ve got to be compliant, and we’ve got to have those figures in real time and send them to HMRC every quarter when it comes into play.

But what we can do by having all that information, is we can do tax forecast and say, look, if you carry on how you are performing at the moment, this is potentially how much tax you’re going to pay.

Have you considered X, Y and Z?

We can have scenario conversations like that, where we can say, have you considered this scenario, have you thought about if you look to buy new equipment, have you’ve considered this and what this will mean?

If somebody, for example, wanted to buy another laser, or another clinic, we’ve got that information in real time, and we can share what impact it would have on their figures.

And is it worth it? Is it not worth it?

It’s those conversations that just make your relationship with your accountant better. And then you actually get a lot more value for the services you’re paying for.

But I think the best thing is, if you are tax wise, you know how much tax you need to pay and you know what you’re saving.

That’s the benefit.

That’s why we have everyone on software, even though MTD is not here yet, we have everyone on software, so we can be having those conversations with our clients and offering that value.

Why a small business below the VAT threshold, might become a VAT registered business

Bex Burn-Callander:

And you mentioned that MTD is kind of here already for VAT registered businesses.

And what’s interesting about that is that I know that some businesses register for VAT before they even hit the threshold. Can you tell me about why a business might do that?

Samantha Senior:

There are different reasons for it really.

So different VAT registered businesses, if they’ve got a lot of VAT outgoing, but they’re actually making a supply where they don’t have to charge VAT, then it’s worth registering, because they can claim all that VAT back.

You can do that voluntarily with HMRC. That’s probably the main reason why somebody would become VAT registered.

Another reason they might want to become VAT registered, despite being underneath the threshold, is because it means that they can obtain more contracts.

I know a lot of people in construction that will only work with VAT registered companies.

Even though their turnover might be below £85,000, they can register as a VAT registered company, pay VAT on everything that they supply and then claim the VAT back on everything that they buy.

But to get the contracts that they want, they have to be VAT registered.

Having your figures in real time helps make tax and business decisions

Bex Burn-Callander:

Oh, that’s interesting.

And that first point about lots of businesses that might rely on buying a lot of supplies where they’re paying VAT and they want to claim that back, are there any particular industries where that tends to be the case?

Samantha Senior:

Something like a health food shop would spring to mind, something that you wouldn’t be paying VAT out on the services.

But the best thing to remember about VAT, and this is something we put in our training courses, is that it’s not your tax.

You are collecting that tax on behalf of HMRC.

So when we take on a new client, we look at what they’re pricing as well.

And this is another thing, things are in real time and if you’re coming up to the VAT threshold we can say, increase your prices to encourage businesses.

So when you’re dealing with a B2B business, for example, when we went VAT registered, our clients predominantly wouldn’t be bothered because they can claim that VAT back.

But when you are dealing with somebody, like a beautician, who is serving the customers every day, if they put VAT on their prices, the customer’s feeling that hit.

And that’s why these are all things that need to be taken into consideration, again, by having your figures in real time, so that you can discuss that with your accountant.

At the end of the day, it’s the consumer who pays the tax, the customer.

If your business is retail and it’s the consumer who’s going to feel that hit, putting 20%, when you registered for VAT, on your prices, it’ll put customers off and they might go somewhere else.

Sometimes businesses then absorb that cost and it’s affecting your figures.

This is another benefit of having your figures in real time, so you can make these decisions about things like that.

Bex Burn-Callander:

It’s interesting though, isn’t it?

Because when you are a sole trader, you just know instinctively, if you keep 25%, maybe to be on the safe side a third of your income, to pay out as tax and sundries at the end of the year, you know you’re square.

But as a business, because there are so many different hands in your pocket, it can be easy to lose track.

So it is good to know rather than just try and go on gut feel.

Samantha Senior:

That’s why if you do have an accountant like us, who is offering the business advisory service, we sit down with clients where we send them pots out.

We call them pots. This is the amount of money that you need to put in your tax pot, this is the amount of money that you put in yours.

This is the amount of money that you need to pay everyone’s wages and your staff bills.

We give that information, so people know where they are, monthly or quarterly. If the information wasn’t on the software and it wasn’t up to date, we couldn’t do that.

But if we did that at the end of the year, well we haven’t used that method for such a long time, where someone hands us all these receipts and we have to look backwards, it would just be a mess.

Bex Burn-Callander:

It’s too late. It’s too late to give advice by then, the opportunity has passed.

Samantha Senior:

On my other business, I do have clients that still like that. But they do the same work every year, they know where they are.

It’s more they’re ticking over, they’re not looking to grow the business, they’re looking to retire.

So they’re ticking over, doing the jobs they want to do.

That’s fine because they roughly know how much tax they pay every year and they put that away.

There’s no business advisory there. It’s literally just there you go Sam, do my accounts and there you go. It’s just done.

Bex Burn-Callander:

Bob’s your uncle.

Samantha Senior:

I think it depends what industry you’re working in, it’s getting across that people do need to be on the software.

But for those other people, I’m lucky where we have those close relationships, we can talk to them. I think it’s just pushing down those boundaries.

And I think once you get through that, then I think they’ll see the benefits themselves.

How a good accountant can save you money as a small business owner

Bex Burn-Callander:

And we’ve talked a bit about business advisory and how important that aspect of your relationship with your accountant is as a small business.

I’d love to hear some examples of things that you’ve seen with clients, obviously naming no names.

But any really interesting ways that you’ve cut costs for them, reduced expenditure, found ways that they can keep more cash in the business.

Any interesting examples that stick out in your mind?

Samantha Senior:

For the aesthetic side of things, it’s easier to have those conversations monthly and quarterly because of how fast they grow.

The main worry in that industry is keeping an eye on the VAT, because we don’t want anybody to go over.

If they are, we need to register them straight away.

Saving people money, is also about getting that information out there, when they’re looking to buy lasers.

Helping somebody with scenarios like that, especially giving advice, because we’ve got the super deduction now.

So if we know somebody’s looking for a laser, and it comes up in the advisory, we can say, actually this laser that you’ve been looking at, is eligible if you bought it this way.

You’re a limited company and you fit all the criteria for the super deduction, you get this extra tax benefit.

What is super deduction and who is eligible?

Bex Burn-Callander:

What’s the super deduction? Lots of people will be asking, “What’s this super deduction?”

Samantha Senior:

Super deduction is something that happened in the [2021 Spring] Budget, it was quite revolutionary.

It’s to make sure everybody in the UK invests back capital after Covid, to help the economy.

The chancellor put in the Budget, that for every plant or machinery bought in these tax years up until 2023, you get 130% tax relief back rather than 100% on the asset.

For every £10,000, you get £2,470 of tax relief.

If somebody is considering buying that laser anyway, or it’s a laptop for a business, or another asset that you’re buying for the business, as long as it fits the criteria, there is this added benefit of you getting that tax relief.

So for every £10,000 you spend on that asset, you’ll get £2,470 back of tax relief.

It’s worth it. But it’s only for limited companies, it’s not for sole traders.

I wrote a few blogs for a few medical journals about it, the information is on my Instagram if you want to check that out.

A good accountant reduces clients’ anxiety

Samantha Senior:

But the super deduction is something we’d discuss at a business advisory.

Taking on new staff, getting new clinics. It’s just general advice that would be that ongoing support.

I think the thing with aesthetics is, it changes so quickly, so you do need everything in real time. Plus, it lets you know what the client wants to do.

We have a structure, when we take somebody on, we want to know a lot of personal information, like do they want to have children next year? Do they want to go on four holidays a year?

It’s that kind of personal stuff.

We can then get the figures and see how they can get what they want, from where they are now and what they need to do.

It’s a roadmap that we put in place.

Obviously, people haven’t been taking holidays, so that’s not something we’ve been able to help our clients with lately. But it’s also been just helping them.

I think from our point of view, it is helping people understand their figures, understanding what these numbers mean, because a lot of people who are in business don’t get taught that side of it.

For us, a big selling point that we are proud of, and a big value that we bring to businesses, is that we reduce anxiety.

A lot of the things that I noticed during the VAT inspections, was the level of anxiety and the impact on a business owner’s mental health.

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