To tackle your IT queries this month our expert panel includes Ray Chidell, senior tax editor at CCH, financial solution providers for tax and accountancy professionals; Omar Kheir, technical director at independent security consultancy Security-4IT; Andrew Rozzier, UK online for business advisor, Northamptonshire; and Bryan Glick, news editor of IT paper Computing.
Q: How do the new tax breaks for training affect my spending power in that area?
RC: Although the recent Budget hasn't changed much, work-related training remains one of the best tax breaks around. Normally, any payment by a business that provides a real benefit for an employee will give rise to an increased tax bill, but not in this area. One employee late last year successfully challenged the taxman and received £18,000 tax-free from her new employer towards the cost of an MBA, saving tax of over £7,000.
Inevitably, there are limitations to the Inland Revenue's generosity. Recreational and entertainment facilities are, not surprisingly, excluded.
A key condition is that the training has to be "work-related", though this is interpreted quite widely to cover almost any type of training that is likely to prove useful for the employment or for other related employments.
So what can be included? Technical training is fine. So too are activities intended to build personal or leadership skills, such as Prince's Trust or Outward Bound courses. Courses aimed at less-skilled employees, or at those who have not previously enjoyed their learning experiences, can be covered, offering the chance for a new start or the starting point for a more positive experience of future learning.
Q: I understand the rules on allowances for IT investment changed in the Budget so that more companies will be eligible - what are the criteria and how exactly did things change?
BG: Gordon Brown announced in this year's budget that the qualifying turnover threshold for small businesses claiming investment tax allowance is to be raised to £20m, the maximum permissible under EU law. This means that the 3.7 million companies that fulfil this criteria can now claim the 40% tax relief.
The allowance covers a wide range of areas, such as training or business improvements, but there is an additional incentive to invest in IT. An existing scheme that provides a 100% tax allowance for the first year of capital spending on IT has been extended until March 31 2004, with more businesses now eligible thanks to the increased threshold.
Q: As a microbusiness we are becoming increasingly aware of how imperative it is to secure our IT operations and protect against unwanted intruders. What's the best way to ensure our information is secure without breaking the bank?
PJ: There are a number of things to consider, many of which don't actually cost anything. For example, make all users change their passwords regularly. Enforce the use of special characters, numbers and mixed-case letters and don't encourage staff to use the same password twice. Discourage the use of Post-it notes as a memory aid. Ensure your network has adequate virus protection with regular virus definition updates, paying particular attention to email protection. Educate your users on identifying and appropriate handling of suspect emails. Also, keep your software current, particularly operating systems. Keep track of, test and implement appropriate patches and service packs as they are released.
In terms of you and the outside world use a good firewall between your network and the internet. Keep it as restrictive as possible and keep it up to date. Don't overlook the importance of strong passwords and regular password changes on these devices. If you have remote users, review the available methods of remote connection, and decommission any modems if possible. Try and enforce use of good Virtual Private Network technology.
Q: I'm aware that I need to consider allowing people to work from home following the Employment Act that came in this month but am concerned about the insurance implications for sending laptops etc into employee homes. What do I need to find out and tell my insurers?
AR: Equipment loaned to employees should be adequately insured to ensure business continuity. There are various types of insurance from home-based work policies to those designed for people on the move. Most home-based polices will also include up to £1,500 cover for a laptop worldwide. If your equipment is more valuable you should ask your insurer to increase the cover. If employees work on the road and do admin at home, a mobile policy might suit you better.
Items are invariably left on trains or have coffee spilt over them. It is probably wise to ensure that any policy will include cover for accidental damage. Theft cover may well be related to employees' postcodes. Specialist home-worker insurance packages might have a fairly low premium as staff do not leave their homes during the day. Relying on employees' own home insurance may not be a good idea.
