Archive for the Current Issues Category

VAT On Some Postal Services!

Although the First and Second Class postal rates are unaffected, as are franked mail and standard parcels, there are a number of postal services that will include VAT from 31 January 2011. These include:

Express and tracked services

  • Special delivery 9am, stamp, franking and account customers.
  • Special delivery next day, account customers only.
  • Royal Mail tracked and tracked next day
  • Royal Mail Same Day

International Services (EU destinations only)

  • International contract services
  • International Airsure
  • International Admail and Admail Packets
  • International redirections

Advertising, Catalogues and Magazine services

  • Big Book
  • Royal Mail Heavyweight
  • Mail Media

Unaddressed Mail

  • Door to Door

If you are a business user of these services you should be able to reclaim the VAT. However businesses that use these postal services who are not VAT registered or have Exempt Services may have to absorb the 20% VAT increase.

Royal Opportunity - Short Lead Times

The advent of the Royal Wedding in April of this year has presented plenty of opportunities for small businesses who can achieve short lead times.The opportunity has further been enhanced by the relaxation of strict rules under The Trades Mark Act 1994. There are still rules as detailed below:

·         Souvenirs must be in good taste, free from adverts and carry no implication of Royal custom or approval

·         Photographs and coat of arms must not be used on clothing and textiles except carpets, cushions, wall hangings and scarves

·         The coat of arms must not be flown as a flag

·         Souvenirs to mark the Royal wedding must not be manufactured after October 1 this year

·         A company or commercial organisation may not display their name alongside a photo of William and Kate

Weddings aside we should point out that short lead times are not the exclusive domain of small businesses. We can help this contact enquiries@emseff.co.uk

Travel Expenses

The Government has finalised the National Minimum Wage (Amendment) (No. 2) Regulations 2010, which amend the National Minimum Wage Regulations 1999 and came into force on 1 January 2011.

 Schemes that operate at the moment allow part of employees’ pay, which would normally be subject to tax and NIC, to be replaced with expenses payments for travel. The amendment means that expenses for travel to a temporary workplace and related subsistence costs can no longer form part of employees’ pay for national minimum wage purposes.

The amendment does not apply in relation to any pay reference period beginning before 1st January 2011.

If you want to know more contact Sue Gott - HR Consultant - who wrote this post. enquiries@emseff.co.uk

Relief for Entrepeneurs

If you make a profit on a business asset which qualifies you for capital gains tax (CGT) entrepreneurs’ relief, you will only pay CGT at a rate of 10% subject to the new lifetime limit of £5 million of gains.

If on the other hand the asset does not qualify you are likely to pay CGT at 28%. Some difference!

Clearly any realistic planning moves which could ensure tax at 10% have got to be seriously considered. A number of ideas are now coming to the surface.

PAC - Productivity and Competativeness Framework

I have now qualified as a PAC analyst for the Sector Skills Councils. This is an offering to look at a business and determine areas where they might improve their Quality, Cost and Delivery (QCD). It is based on the 7 DTI measures of:

  1. Not Right First Time (NRFT) - internal and external
  2. Delivery Schedule Achievement - (OTIF)
  3. People Productivity
  4. Stock Turns
  5. Overall Equipment Effectiveness (OEE)
  6. Value Added per Person
  7. Floor Space Utilisation

Phil - Business Improvement Consultant

BIT - a breakdown

 The NVQ qualification in Business Improvement Techniques is now under the new QCF (Qualifications and Credit Framework) and has become QBIT at Levels 2,3 and 4. The skills delivered in Business Improvement Techniques (BIT) are key LEAN tools which candidates learn and practice during their course. The businesses I work with find that these drive the individuals to find the hidden wastes and improve productivity. The subjects that can be covered are:

  • Health and Safety
  • Contributing to or leading effective teams
  • Applying workplace organisation techtiques (5’s)
  • Applying continuous improvement techniques (Kaizen)
  • Developing visual management systems
  • Carry out problem solving activities
  • Analysing and selecting parts for improvement
  • Creating standard operating procedures
  • Low Process analysis
  • Mistake proofing (Poka Yoke)
  • Set up reduction (SMED)
  • Applying Total Productive Maintenance (TPM)
  • Lead time analysis
  • Failure Mode and Effect analysis (FMEA)
  • Statistical Process Control (SPC)
  • Value Stream Mapping

Phil - Business Improvement Consultant

The Bribery Act

In April 2011 the Act will introduce new criminal offences.  Most important for employers is the offence of “failing to prevent bribery”.  If there is a breach, there is the risk of imprisonment and fines. 

Written by Simone Greasley - HR and Recruitment Specialist 

VAT increase

As you will be aware the VAT rate increased from the rate of 17.5% to 20% on 4 January 2011. Retailers have already implemented this as you’ve seen from the news and probably experienced. However most small businesses invoice monthly so don’t forget to implement this on or before 31st January 2011

In addition the rates applicable to the Flat Rate Scheme will also increase. See below for more details.

For any sales of standard-rated goods or services that you make on or after 4 January 2011 you must charge VAT at the 20% rate.

If you have a cash business and calculate your VAT using the VAT fraction you must use the VAT fraction of 1/6 on your standard-rated VAT inclusive sales from 4 January 2011.

The change only applies to the standard VAT rate. There are no changes to sales that are zero-rated or reduced-rated for VAT. Similarly, there are no changes to the VAT exemptions. Any sales you make at these rates are unaffected by this change

Employment Guidance: Statutory Rates Increase……

Looking ahead in 2011, the weekly rate for statutory maternity, paternity and adoption leave pay will increase in April 2011.  It will rise from £124.88 to £128.73.

Statutory sick pay will increase from £79.15 to £81.60.

Written by Simone Greasley - HR and Recruitment Specialist

Tribunal Awards In 2011

As we enter the New Year, Employers should be reminded that as of 1st February 2011 there will be an increase to the limits which will apply to Tribunal Awards and other amounts payable (under employment legislation).The maximum amount of a ‘week’s pay’ will increase from £380 to £400 and the maximum compensatory award for unfair dismissal from £65,300 to £68,400.It therefore pays to get your HR practices right in 2011.  For guidance, call Simone Greasley at EMS.