Recruitment Case Studies
Most accountancy firms can reduce your tax bill. Far fewer have what it takes to minimise the tax you pay at the same time as helping maximise your profits. We offer all the technical expertise you’d expect from Chartered Accountants, plus the savvy commercial sense, insight and connections of experienced business advisors.
Here are some examples of how we have helped our recruitment clients.
Hive of activity
A client owned two recruitment companies, one of which was profitable and the other with a history of loss making. They were keen to keep both brands and both businesses running but wanted to streamline the group and save costs.
Having examined various options with them, they decided to proceed with our recommendation, which was a procedure known as a “hive across”. This involves a complete transfer of the trade and all associated assets and liabilities from one company to the other, while using tax rules to legitimately preserve tax losses.
Although a hive across sounds straight forward enough on paper there are a number of tax, accounting, and more importantly commercial factors to take into account. By working closely together, we made sure that between ourselves and the client all of these were addressed and dealt with satisfactorily.
The process went smoothly with us guiding the client through every stage of the process and they now have one company with two trading divisions. Results have improved, thanks in no small part to the cost savings from a more streamlined operation, and the tax losses can be utilised against profits.
Early warning system
One of our clients asked for our help in assessing the suitability of a potential acquisition. The target company had done a good selling job, but alarm bells were ringing with us.
We helped our client to prepare a business plan and financial forecasts so that we could approach financiers if a deal was to be struck. As well as this we did some preliminary due diligence, and as we scratched beneath the surface there were clearly some problems with the new business pipeline as well as property issues, and the vendor’s expectations on price just didn’t stack up with the prospects of the business.
This highlights the benefit of having experienced advisers on your side so that deal breaking issues are identified early on before lots of professional fees are incurred.
To us, one of the basics in owner managed companies is to get the remuneration planning right. However, that’s not always the case with other accountants.
In one case we inherited a position where monthly drawings were biased heavily towards salary, a situation we thought less than optimal. A few calculations and some simple face to face explanations later and the split of monthly rewards was altered, meaning substantial tax savings should now be achieved each and every year.
This then led to a complete review of the owners personal financial affairs and we set the wheels in motion to help mitigate future capital gains and inheritance tax.
See how we could help you achieve your goals
Find out more about what we have to offer. Call us on 0845 606 9632 to arrange your free Business Review. There’s no obligation, just a great opportunity for you to find out how we could add value to your business and help you achieve your goals.