With the Michelin and also JTI tobacco factory set to close and Ballymena facing some of its most challenging times, local tax specialist Ian Aiken is advising those affected to think carefully about the future and ensure their redundancy payout works for them. 

Ian Aiken who runs TaxAssist Accountants in Ballymena said: “Don’t rush into making decisions about how you are going to use your redundancy pay out.  First things first you need to check you’ve got the right amount, if you owe any tax or alternatively whether you are due a tax rebate.  

“Redundancy pay outs are tax-free up to £30,000, excluding holiday pay and pay in lieu of notice. If you don’t need to spend your redundancy pay, you could consider using all or part of it to top up your pension pot. Paying into a pension scheme can be tax-efficient but we’d recommend you seek advice from an Independent Financial Advisor who can help ensure you make the most of your pay out. 

“We’ve seen an increasing number of people coming to us enquiring about using their redundancy payout to set up their own business and, with the banks expecting to see you inject at least 30% of your own cash into your new business proposal as security, this could offer the opportunity to take the leap into self employment.   

“Setting up your own business can be extremely rewarding, offering more flexible working and the potential to be more tax efficient. However, with the move to quarterly reporting to HMRC on the horizon, if you’re seriously considering making the leap, it’s vital to produce a clear business plan, cashflow forecast and to keep records in order. We can also help advise whether it is more tax efficient to set up as a sole trader, partnership or limited company.”

Under current rules, fledgling businesses may not make tax payments for up to 21 months in their crucial start-up phase.

Ian added: “Budding entrepreneurs should also consider the cost efficiencies of setting up from home rather than going straight into premises, such as saving on transportation and premises costs.”

TaxAssist Accountants in Ballymena is a local business providing tax and accountancy advice and services purely to small businesses across Ballymena, Broughshane, Mid Antrim, Randalstown, Ballyclare and the surrounding area.