New 30% of Profits Penalty tax to be introduced…

Red card

A new 30% of profits penalty being introduced would stop me in my tracks and whatever had to be done to avoid it would happen.

What is this new Penalty about?

I’m not sure about you but I have been up to my tonsils as usual at this time of the year with getting all my bits and pieces up to date for the tax deadline. The thought of financial penalties is a terrific way of focusing the mind!

When you have to, you can get really focused and the whole tax deadline scenario made me think about all the other deadlines that make us get a task completed. The bank requesting figures, VAT & PAYE returns, a tender document closing date, or even a client presentation deadline or event. We pull out the stops and invariably, always deliver on time and achieve whatever is required.

So, deadlines are effective?

Of course they are but do we have deadlines for the really important things? I find that often some of the really important tasks get pushed back because of the other deadline issues. We can easily leave other priorities get pushed to the back of the queue because they lack a pressing, external deadline that has obvious and tangible downsides.

Planning
How about setting a deadline for your annual Business Plan?

Is there really any deadline that should be more important than this? After all, this is the starting point for everything in your business and it makes all other things possible.

How about it being completed in November before everyone starts winding down for the Christmas break? Isn’t it absolutely vital that your team starts the new year with a clear focus on the objectives for the business, for their departments and for themselves as individuals?

Business Planning

Clarity
Does your business have a crystal clear goal or purpose or even a “Mission Statement” that everyone understands and is working to? This needs to be real, it needs to be practical and it needs to be supported by definite plans.

SWOT Analysis
Have you and your team completed a real SWOT analysis for your business?

Have you in detail discussed the Strengths and Weaknesses of your business? These are the things that make your business special and vulnerable all at the same time. What are the Opportunities for your business in the marketplace? Have a detailed look at these and it may even result in some required diversification. What Threats are posed to the business and how are you dealing with these?

Make sure you have done a competitor analysis as part of this. To be honest I wouldn’t get too obsessed about the competitors but you do need to understand where they are coming from and the tactics they are adopting and how they could affect you.

Play your own game, let them try to catch you!

The SWOT analysis should be done at Company level and then repeated at Department level. This will clearly highlight some key issues for all areas of the business and for the plan to be affective the business must have a clear plan around the tackling of these.

Plans are ineffective without detailed actions and someone needs to take clear responsibility for these.

Objectives & Budgets
The detailed plans and responsibilities need to be built into the department and individual’s objectives. These plans need to be supported by detailed budgets. What income targets are set for the business and what spend is required to achieve this?

As an individual I need to know about my part in the overall plan, what is expected of me and how my performance will be measured.

Performance Management
Performance Management is the ongoing evaluation of the performance of the business against the agreed plan. Of course the market is dynamic and things will change during the year, which the business will have to react to. Build this flexibility into your plans and amend them as this happens.

Positive Marketing
Make sure you have a really clear Marketing Plan written as part of your overall Business Plan. What are your Marketing Objectives and how will these be achieved?

Don’t go into retreat mode and lose the position you have fought hard to achieve in the marketplace. Be brave, it’s never been a better time to market your business. Take the terrific value that is still available in Advertising/PR/Marketing for your business and don’t ignore the free(ish) Social Media opportunities that are available to spread the word about your business.

Unique Opportunities
There are unique opportunities available in the current climate, which just won’t exist in a few years time. Be in a position to grab them with open arms and thrive.

Penalty Tax!

There is no 30% penalty tax on your profits for the not having your Business Plan ready for the start of the year. However, how much will it cost you if you go into next year unprepared?

30%, or maybe even more?

Greg Canty 

Greg Canty is a Partner of Fuzion PR, Marketing and Graphic Design, with offices in Dublin and Cork

 

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One Response to “New 30% of Profits Penalty tax to be introduced…”

  1. Steven Says:

    Hi Greg,
    Interesting post. We had the same discussion here at Midpoint and decided that we like deadlines. They do help us focus and keep us sharp, especially in our trade when there is loads of temptation to go off on creative tangents. Its great to have a deadline to work to as long as everyone remains committed to meeting them, which is quite the different issue.
    We wrote a post on our blog (Deadlines, deadlines, deadlines). Feel free to check it out.

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