The Business Clinic – November 2016

Expert advice on the business of running a garment decoration company

Business concerns expressed to government

• An open letter, signed by the CBI and other business groups, has called on the government to work with businesses when negotiating the UK’s exit from the EU. The letter, sent on 7th October 2016, highlighted three areas of concern:

  1. The need for a barrier-free access to the EU’s single market.
  2. The impact of defaulting to standard World Trade Organisation (WTO) rules when leaving the EU if no preferential trade arrangement is agreed on, noting that “every credible study that has been conducted has shown that this WTO option would do serious and lasting damage to the UK economy and those of our trading partners”. The letter calls for this option to be ruled out under any circumstances.
  3. That two years is not long enough for the EU negotiations to be completed, and so an agreement for a transitional period should be secured by the UK government.

  The letter concludes that a clear roadmap for consulting with firms from all sectors and sizes should be established to boost confidence in the decisions being taken and ensure prosperity for everyone across the UK.

Q&A

I set up my business a year ago with my friend. We’re now employing three people full-time and one part-time, all on permanent contracts. Do I need to set up a pension scheme?

Auto enrolment legislation was first introduced in April 2012. The timescale for a company to adhere to the legislation depended on the amount of employees at this date. This is known as the ‘staging date’.

For companies that started after April 2012 the staging date is usually July 2017. All companies should check their staging date and this can be easily done by going to The Pensions Regulator (TPR) website: www.thepensionsregulator.gov.uk/employers/staging-date. All that you need is the company’s PAYE reference.

There are different obligations for employers depending on the ages and the earnings of employees. In short, any employee earning above £10,000 per annum and between ages 22 and state pension age is classed as an ‘eligible employee’ and must be automatically enrolled into a pension scheme. As an employer there are also obligations for those that fall outside of this criteria and all staff must receive a communication depending on whether they are ‘non eligible’ or ‘entitled’. TPR has definitions of these categories and examples of letters that can be used on its website.

The minimum required contribution level will rise over the next three years and can be paid solely by the employer or a combination of employer and employee contributions.

An employer must choose an appropriate pension scheme for auto enrolment. Most of the major pension providers have auto enrolment solutions. NEST is a government-sponsored scheme and, as a provider, has an obligation to accept all enquiries.

Employer obligations do not stop at the staging date. At each ‘pay reference period’, employees will need to be reassessed to see if they are eligible. Pension providers and payroll companies have software that can assist with this and will also provide a valuable audit trail.

Companies that consider pensions to be a valuable employee benefit should seek independent advice to ensure that a quality pension scheme is put in place.

A beginner’s guide to online payments

Everyone wants a slice of the online cake; being able to trade online is almost a necessity now in order to offer customers the most comprehensive service. Whenever we chat to any potential customer we always get the same line: “Oh, we want the site to take payments online.” Of course, this is something we encourage in the industry, but it is not quite as straightforward as you would imagine…

Setting up online payments needs to be done well and, most importantly, securely. With a multitude of options out there, we have put together our top three key points to consider.

1. Consider the costs

People who want to offer an ecommerce option often do not consider the full costs and scale of taking online payments.

Taking an online payment costs money for every transaction as payment suppliers take X% of the total. But there are options to make it simple, such as pay as you go option Stripe, or pay monthly option Sage Pay. What we always recommend is to run some scenarios and test which is the most cost effective and viable for your business.

Also, some payment processors require companies to have an internet merchant account (IMA), which is an additional cost through your bank.

2. Keep your basket and checkout secure

Whether your business uses a platform or is built from scratch, your basket/checkout process needs to be Payment Card Industry (PCI) compliant. This is a legal requirement to take payments online; your site needs to be structured and geared to facilitate card payments from leading card suppliers such as Visa, MasterCard, Amex and so on.

Platforms will have constructed baskets with this in mind, but if your site is bespoke, check with the developer that this in place. Both your checkout and your customer’s payment information need to be secure. There is a multitude of laws and regulatory guidelines in place which makes this a must for businesses.

3. Pick your developer

You may be using a platform that integrates with a number of different payment solutions. If, however, you are going it alone, pick your developer very carefully. The cheapest option is almost never the best one.

Ask the right questions: ask about the options you have, any accreditation they may have, the basket, the checkout and PCI compliance. Taking online payments needs to be done securely, otherwise you are putting both your business and its customers at risk.

If you have a business question for any of our experts, email it to: rachael@imagesmagazine.com