KMA Goldmine TV – Episode 23 – 2019 National Minimum & Living Wage

“KMA GOLDMINE TV EPISODE 23 – 2019 Changes to the National Minimum and Living Wage”

 

 

Here, Kim Marlor talks about changes from April 2019 to the National Living and Minimum Wage

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Hi, it’s Kim here from KMA Goldmine TV. Bit sized bits aimed at helping you to get your business from where it is now to where you want it to be.  This week, I’ve got something a bit more factual for you. We’re fast approaching the new tax year and I just wanted to give you a little bit of information about the National Minimum Wage and National Living Wage. Apologies as it’s numbers, I’m going to have to just refer to them because I can’t remember them all from the top of my head. So, the apprentice wage currently is £3.70 per hour from April 18, from April 19 it goes up to £3.90 aged 16 to 17 it goes from £4.20 to £4.35. 18 to 20 £5.90 to £6.15 six pound, 21 to 24 £7.38 to £7.70 and 25 plus, which is obviously the national living wage – it goes from £7.83 to £8.21 an hour.

So, what does that mean? Well, basically it means that if you have somebody age 25 and above working for you for 37 and a half hours, then currently you’ll be paying them at least £15,268.50 per year to do that work for you. Now from April 19 that will rise to just slightly over £16,000, if you want to be accurate, £16,009.50. So that’s an increase of £741 pounds or approximately 5%, so clearly you need to be thinking about what you can do in your business to increase the profits. Now that may be looking at efficiencies, may be selling a bit more, maybe just tweaking those different areas of your business to get your profits up. But clearly if you do nothing, then you’re going to be at least, well approximately a thousand pounds a year worse off as a result of this increase for every 25 year old that you have working in your business.

Equally, I’m sure you’re aware, but just in case that there’s also been increases in auto enrolment charges. So, from the 6th of April 18 you had to pay a minimum of 2% of qualifying earnings for your employees and your staff were paying 3% so 5% was going into their auto enrolment pension. Now from the 6th of April, 19 that’s rising to 3% minimum for employers and 5% for staff. So, it’s an 8% minimum going into that auto enrolment scheme. Clearly that’s also going to impact on your profitability of your company. So just wanted to kind of give you that news. Hopefully it’s already on your radar, but clearly you need to be thinking about how you can recoup that. Otherwise, as a business owner, that’s going to be out of your pocket. So that’s it for this week. Until next time Kim from KMA Goldmine TV. Bye for now.

If we can help with anything included in this edition or if you’d like to talk to us about anything Accountancy or Business development, then call us now on 0161 410 0016. 

 

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