The FreeAgent Blog

National Coworking Day 2018

Posted on 14 May 2018 by Fiona Hendrie - Jump to comments

May 8th was National Coworking Day in Scotland, and we were delighted to take part in the celebrations!

Coworking spaces offer flexibility, community, collaboration and so much more to those who use them. They’re perfect for self-employed and remote workers looking to experience some of the hustle and bustle of office life, while still retaining the freedom of choosing their own work. In collaboration with Shoal, we sent a couple of the FreeAgent team to try out a few nearby coworking spaces, as well as welcoming some local freelancers in to spend the day at FreeAgent HQ.

Welcome to FreeAgent!

Shane and Colin in coworking spaces

Using Shoal’s coworking directory app, six plucky self-employed workers chose to make FreeAgent Towers their office for the day. Thank you so much for joining us Alex Porter-Smith, Mike Paul, Daniel Reilly, Stuart Mackay, and last but not least, Rachel Arthur! We hope you enjoyed your time here (we know you enjoyed the pool table 😉)!

A FreeAgent field day

Shane and Colin in coworking spaces

Shane and Colin from our engineering team decided to try out a couple of coworking spaces in Glasgow. After spending a productive day at RookieOven, Shane said: “It was good to get a break from working in my flat! I liked RookieOven because of the relaxed atmosphere, friendly people and the frequent visits from office dogs. They also have a pool league, which is a nice way to meet new people and network”

Meanwhile, Colin set up shop at The Whisky Bond for the day. “I really enjoyed the office’s lovely view of the canal, as well as its handy location. When you’re working remotely, it’s good to mix up your environment every now and then, to keep things interesting.”

If you’re keen to give coworking a go, check out Shoal’s directory of co-working spaces across Scotland.

How FreeAgent can help you comply with GDPR

Posted on 10 May 2018 by Richard Grey - Jump to comments

The General Data Protection Regulation (GDPR) is almost upon us. The 25th May 2018 deadline for businesses to meet their data compliance obligations is just a couple of weeks away and we’ve been working hard to make sure we’re compliant with the new data protection rules.

We know that GDPR is a big deal for our customers too, and we're committed to supporting you with your own GDPR requirements within FreeAgent. While data security has always been a top priority for us, we’ve made some updates in our software so you have the tools you need to handle your contacts’ data in a compliant manner.

Before we go into that however, let’s take a quick look at how data is structured under GDPR in FreeAgent.

Diagram of data processors, controllers and subprocessors in FreeAgent

As the UK’s supervisory authority, the Information Commissioner’s Office (ICO) ensures that everyone is playing by the rules and that the rights of data subjects - the people whose data is being processed - are correctly protected.

Data controllers determine the purposes and means of processing personal data. A data processor is responsible for processing data on behalf of the data controller.

As we act as a data processor for our customers, we are committed to ensuring that you are able to meet your own obligations as a data controller.

What are the specific duties of a data controller?

As a data controller, you need to be able to respond to data requests from your contacts (the data subjects) in FreeAgent.

As far as the data in FreeAgent is concerned, this includes:

  • Keeping data secure
  • Keeping information accurate and up to date
  • Providing a copy of all data you hold on an individual if requested
  • Deleting all data you hold on an individual (where possible)

Keeping data secure

We are constantly improving our security measures to keep the information we hold within FreeAgent safe and whenever we work with third parties (subprocessors) to help us provide our service, we ensure that their security processes are as robust as our own.

Recently, we added new security measures such as active sessions and login attempts so you can see if there has been any unauthorised activity on your account. Our password security calculator will help you set a really strong password and we also recommend you use the 2-Step Verification feature to make your account extra secure. If you’re worried about anyone at FreeAgent being able to see what’s going on in your account, you don’t need to be. You are the king or queen of your own castle when it comes to your account and no-one at FreeAgent can see your data unless you give them access.

Keeping data accurate and up to date

FreeAgent makes it easy for you to maintain an accurate and up-to-date record of your contact’s details. When you update a contact’s information on their contact card FreeAgent automatically pulls the latest information through to any new invoices or emails. This only applies to newly created documents, however; any historic invoices or emails stored in FreeAgent will still contain the information that was correct at the time you created them. This is because HMRC says that you need to keep full copies of your historic information.

Providing a copy of an individual’s data

Using the Export All Data feature on FreeAgent makes it easy to create a copy of all the data you hold on a contact. This feature exports all your data from your FreeAgent account and by 25th May will also export all your files and attachments so you can locate the relevant information.

Deleting a contact’s data

If one of your contacts asks for their information to be permanently removed from your records, they have the right to have their data deleted as fully as possible. Under GDPR this is the responsibility of the data controller, so if one of your contacts asks FreeAgent to do this, we have to refer them back to you. Your legal obligations to HMRC come before an individual’s right to be forgotten under GDPR, and we’ve built safeguards into our software to make sure you balance both of these requirements.

Once you've created a transaction (i.e. an invoice, estimate, bill, project or timeslip) for a contact, you will be able to delete that contact once you’ve deleted all the transactions relating to them in FreeAgent. Once you have done this, you will see the option to ‘delete’ in that contact’s details screen.

However, because HMRC requires self-employed professionals to keep a copy of their records for at least five or six years after the relevant self assessment submission date, and limited companies to keep a copy of their records for at least six years after their accounting year end, you should not delete a contact from FreeAgent with transactions that fall within these periods.

In addition, FreeAgent doesn’t allow you to delete transactions that are dated within a locked period or those that are attached to a filed VAT return, which means that you won’t be able to delete any contacts with transactions that fall into either of these categories. In this way, FreeAgent helps you to ensure that you are not deleting any information that you are required to keep for HMRC.

Please be aware that deleting transactions linked to a contact will have an effect on your accounts and once you’ve deleted any information in FreeAgent it can’t be restored. If you're unsure whether or not to delete any data in FreeAgent then please do check with your accountant.

To find out more about FreeAgent and GDPR, you can read our GDPR statement.

Richard Grey is a Certified Information Systems Security Professional with over 15 years' experience managing personal data across various software solution providers. He is Head of Information Security at FreeAgent.

Help us give small businesses a big voice

Posted on 9 May 2018 by Adrian Mather - Jump to comments

Here at FreeAgent, we’re on a constant mission to champion the voice of micro-business owners - and we need your help to do it!

If you’re a customer and you’ve been with us for a while, you may have already seen - and possibly even responded to - one of our Micro-Business Monitors. They’re surveys that we send out every six months or so to gauge how business owners are feeling about self-employment, and they’ve uncovered some really interesting information in the past.

Last year, for example, we found that many micro-business owners were still unaware of the Making Tax Digital agenda, despite the government actively promoting the flagship policy and running a number of public consultations on the plans. We also discovered that the majority of micro-business owners not only worked excessive hours without taking breaks but also didn’t feel they could afford to take time off when they fell ill.

We want to continue using the insight you share with us in these survey results to fight for UK micro-business owners and highlight their experiences to those with the power to make changes. We’ve already made some progress: just last year we teamed up with the Freelancer & Contractor Services Association (FCSA) to discover which statutory pay benefits self-employed workers would like to receive, and then used the information to form an official response to the government. We’re keen to keep the ball rolling in 2018 and beyond!

If you’d like to help us on our mission, we’d be super grateful if you could take our latest survey. We’re seeking your views on everything from Brexit and the General Data Protection Regulation (GDPR) through to small business taxes and late payment, along with your day-to-day experiences of running a business. Completing the survey will take a few minutes of your time but the results could have a long-term impact on the small business community.

As a thank you for taking the time to help us, we’re offering the chance to win a shiny new Amazon Echo! Just pop in your email details at the end of the survey and we’ll enter you into the draw.

Take the survey

Time for a new tax year! What’s changing for small businesses?

Posted on 5 April 2018 by Emily Coltman - Jump to comments

A new tax year starts on 6th April and that means a set of changes from previous budgets and statements will also come into effect. Here's a round up of what’s changing for small businesses:

Making Tax Digital: time to get ready!

Is your business registered for VAT and does it have to be registered because its sales are over the threshold? Making Tax Digital (MTD) reporting for VAT will become compulsory from 1st April 2019 for all businesses who are, and have to be, registered for VAT.

Why is this relevant now? If you prepare your accounts to 31st March every year and you’re not yet using digital software to keep your books, 1st April 2018 would be the best time to move across to a digital system so that you're ready and prepared for MTD to start, because an accounting year end is the easiest time to switch system. If you're trying to get to grips with a new bookkeeping system and a new filing method at the same time, it will make life harder for you, so we suggest you get ready early!

Dividend allowance falls

6th April 2018 sees the 0% tax allowance for dividends fall from £5,000 to £2,000 a year. That means if you are a sole director/shareholder of a limited company and you withdraw money from the company in a mixture of salary and dividends, your tax bill may go up. Do talk to your accountant about tax planning.

Pension contributions going up for the first time

There is an increase in the minimum contributions for automatic enrolment pensions, with the current combined minimum contribution of 2% rising to 5%. As before, the employer and the employee can choose to pay more than the minimum contributions if they want to.

Date Employer minimum contribution Employee minimum contribution Total minimum contribution
Before 5th April 2018 1% 1% 2%
6th April 2018 - 5th April 2019 2% 3% 5%
6th April 2019 onwards 3% 5% 8%

VAT registration threshold stays the same

The VAT registration threshold usually rises every year at the beginning of April, but this year it's not going to. The Autumn Budget 2017 held the VAT registration threshold at £85,000 for a further 2 years, starting from 1st April 2018.

This represents a decrease in the threshold in real terms, since inflation is still rising.

Scottish rates of income tax changes

If you're a Scottish taxpayer, you'll suddenly be subject to several more rates of income tax than anyone in the rest of the UK.

Here are the new Scottish rates of income tax that will apply from 6th April 2018, for taxpayers who receive the standard UK Personal Allowance;

Band Band name Rate
£11,851 - £13,850 Starter rate 19%
£13,851 - £24,000 Basic rate 20%
£24,001 - £43,430 Intermediate rate 21%
£43,431 - £150,000 Higher rate 41%
£150,001 and over Top rate 46%

The Personal Allowance will reduce by £1 for every £2 of income above £100,000.

These rates and bands apply only to income which is neither dividend income nor savings income. So, for example, if you are a sole director of a limited company, and you're a Scottish taxpayer, you'll pay tax on your salary at Scottish rates, but on your dividend income, you'll pay tax at the rates applying to the rest of the UK.

HMRC have now said that marriage allowance will be given at 20% regardless of whether the spouses are Scottish taxpayers or based in the rest of the UK.

Increase in key rates and thresholds

Here's a brief summary of some of the rates and thresholds increases for 2018/19. All of these are for the full tax year unless otherwise stated:

Details 2018/19 2017/18
Personal Allowance £11,850 £11,500
Employee’s and employer’s NI becomes due at £8,424 £8,164
Higher rate tax becomes due at* £46,350 £45,000
Class 2 NI becomes due when profits pass £6,205 £6,025
Class 2 NI per week £2.95 £2.85

*Except in Scotland

You can keep up to date with current tax rates here; all listed rates, thresholds, limits and charges are updated every time a change is made so you’ll always know where you and your business stand with the taxman.

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