Practical support and financial expertise required
Simon Hodges founded Supreme Sliders in 2005. It’s a company that designs, manufactures and installs made-to-measure wardrobes and home storage solutions. By 2018, he had grown the business to the point where he needed another pair of hands and he invited his brother James, a quantity surveyor, to join him.
Initially, the brothers ran the company as sole traders under a partnership arrangement. Simon worked on site in customers’ homes while James ran the office, doing all the quotes and the paperwork. A freelance bookkeeper did the books.
As the company continued to grow, James soon found himself needing to be more hands-on so had less time to spend in the office. A particular concern was the accounts side of things. As James says: “We got to the point where we were taking on so much work, we needed the accounts side to be reliable and to be able to see what was going on at any point. The way we were set up didn’t allow us to do this. We also knew that the way the business was heading, we were going to need more advice than a bookkeeper can give.”
Ian had been a customer of Supreme Sliders and the brothers thought he could give them the help they needed, so they appointed Vertis Accounting as their accountants.
A new company structure
The first thing we did was look at the way Supreme Sliders was structured as a partnership. From their ambitions for the future we could see that a limited company structure would be a better option. James says: “Ian advised us on the benefits of a limited company structure and the savings in terms of taking money out of the business. There was obviously the liability side of things too. It was clear this was the right way to go – I think it was the best decision we ever made.”
We managed the closure of the partnership and incorporated the business as Supreme Sliders Limited. We recommended our payroll partner, KMS Payroll Services Ltd, to take care of Simon’s and James’ salaries and the salaries of their employees.
We could also see from their turnover that they would need to register for VAT, which we arranged.
A new way of working
Digital accounting offers benefits to every company. It’s particularly useful for companies such as Supreme Sliders who have lots of customers and suppliers and spend a lot of time on the road rather than in the office.
We set Supreme Sliders up on Xero. James is the one who uses it most often and he’s delighted with it. He says: “Xero’s been absolutely fantastic and is really user-friendly. You’ve got all the individual reports, so you can literally see your turnover, a breakdown of individual suppliers, how much you’re spending with each one. It does a bit of a cost analysis as well, so you can see where you’re spending money. The previous accounting was very much on the old traditional spreadsheets and trying to look through it was difficult. This is so much better.”
We also set them up with two other apps. The first was Hubdoc, which takes all their receipts, bills, statements and emails and automatically exports them into usable information within Xero.
James says: “Instead of me sat there typing the invoices up, you feed them into Hubdoc, all the information is extracted and it goes into Xero automatically. We can get 50 invoices in a day, so this makes a huge difference.”
The other was Soldo, which helps them manage company expenses. It’s the digital equivalent of a petty cash tin, so it avoids month end expenses and means employees don’t have to spend their own money and claim it back. Simon says: “Each of our employees has a Soldo card, which is like a bank card. We put funds onto them and we can monitor them to see what’s being spent. It’s a really useful app and it’s come in very handy.”
Keeping on top of tax
Staying up-to-date with all their tax liabilities was important to Simon and James and they appreciate that we stay on the ball for them. James says: “Ian will get in touch about VAT returns, corporation tax, anything that’s due, so we don’t miss the deadlines. It’s always way before the deadlines as well, so we’ve got advance notice.”
At the same time, we’ve always made sure Simon and James aren’t overpaying their tax. The limited company setup means Simon and James take a small salary with dividends on top of that. This arrangement ensures the brothers minimise the tax and NI that they pay while still qualifying for their state pensions.
We’ve also been able to offer other advice. As James explains: “We’ve purchased vehicles and Ian’s ensured we claimed all our capital allowances to reduce the amount of Corporation Tax we pay. It’s the same with any tools that we buy, and everything else, right down to washing our work clothes and overalls. It all adds up and has really saved us quite a bit of money.”
As well as the money we’ve saved them, James says he appreciates our approach. He says: “The one thing I like more than anything, is that Ian is strait-laced. There’s no cutting corners, he never does anything dodgy. It’s nice to have someone like that who’s completely honest, and that’s what we need, if we want this company to thrive.”
Simon agrees, saying: “Ian is approachable, reliable and intelligent.”
A company on the up
Simon and James have achieved an incredible amount in the past couple of years, which is great to see.