Author: admin

What’s interesting to me as a business coach is that once we start to make some money in our business it’s tempting to hang on to it. After all, we have taken a risk and set up a business, we’ve worked hard for minimal returns and now we have a small profit to shout about we want to hang on to our cash.

However, we can forget that at the start of our journey we happily invested money into equipment, training, staff, business cards, a website and so on. We can fall into the trap of assuming our investment days are over and now we can rake in the cash and pop open a bottle of fizzy!

When I started Primary People Ltd over 14 years ago I spent a wad of cash on becoming a properly qualified psychometric assessor. The next year I joined a Transactional Analysis (TA) training group and the year after …realised that ongoing CPD was never going to end. I had falsely assumed that after a couple of years I could divert the money spent training straight into my pocket and then one Spring day, when I was preparing my budget for the next financial year, I realised that if I wanted to stay in business I needed to keep on investing in my own skills.

I’ve published 6 books about business and career management and love supporting people to get a job, and yet even after 10 years of being an author it never ceases to amaze me when people expect to get  job without spending any money on a book, or a coach, or any interview practice. Job hunting is tough, competitive and tiring, so of course it makes sense to wing it and trust to luck. Er no. Not really.

Business is the same. If we see development and marketing spend, for example, as a cost then we run the risk of resenting it as an unnecessary intrusion into our profits. However, if we view this expense as an investment then we are more likely to budget consistently and we will keep on growing and out-pacing our competition.

Putting this into real terms for a minute, I have personally invested over £20,000 in my own TA training. Sounds a lot doesn’t it. Then when I share that this investment has earned me over £500,000 it suddenly makes good sense. A no-brainer. Value for money.

This week we can all take a fresh look at our budgets and can ask ourselves if we are grudging the costs of running our business, or smiling at the wise investment we are making in our success.

And if you know someone who is looking for work then invite them to check out Job Hunting 3.0 on Amazon and suggest they buy any book about CV writing, interview skills and so on. It’s an investment that makes sense. The herd trust to luck. Invest in yourself and beat them out of sight!

Next week: Quitting Is Cool

I really don’t mind paying taxes, after all I use the roads and schools and so on, so it seems reasonable to pay up and be part of society.

In business we have to pay tax on our earnings and pay corporation tax if we are a limited company. I also add VAT to my invoices and happily collect money for the government. VAT is a one of those things that can cause endless debate, and I’m not making a case for or against it. However, I am saying that if your business is VAT registered then maybe check what rate you pay back at, if like me, you are in the Flat Rate Scheme.

The Flat Rate Scheme makes the quarterly return a doddle. Instead of muddling through a pile of receipts and trying to work out which bit of what VATable expense is applicable, and which isn’t, all I have to do is take my gross invoice total and apply a single percentage to that. A frustrating morning becomes a gentle half hour and all is good.

And all is even better since my accountant challenged my status as a consultant with dear old HMRC. As a consultant I was paying back 14% of my gross invoice total, however a closer look at their definition revealed that the one thing I don’t ever do….is consult. My contracts are for training, coaching and organisational development, where the client owns the agenda and takes responsibility for their decisions and actions. I am not a consultant.

The upshot of this is I’m now registered in a category for ‘other business’ and the joy here is that the rate is only 12%. If that wasn’t enough good news, the change has been backdated to 2013, which means I’m owed a fat rebate on 4 years of VAT paid. So whilst I’ve been acting as a tax collector, the tax collectors have been acting as a savings scheme for me and I’m not complaining about it!

The message of this story is that if you are VAT registered and in the Flat Rate Scheme then talk to your accountant and double check to make sure you are in the right category. I thought I was, but as my accountant knows more about these things than I do, he was confident that he could get them to change. He was right.

I can’t wait to submit my next VAT return as it will be a minus figure and my bank account will go up instead of down. Not a bad result for a couple of letters and a small cost to cover the time from my accountant.

Happy VAT checking this week! Well worth the effort!

Next week: A ‘Cost vs Investment’ Mindset