The National Living Wage is Rising - Is Your Business Prepared?
In April, the National Living Wage is rising significantly. For businesses, this could mean a big difference to employee wages. Here's a guide to what you need to know about the changes for you and your business.
From the 1st of April, the National Minimum Wage and National Living Wage rates will increase. You may already be aware of this, however, you may not know that some of your staff members may be getting close to a 9% hourly pay rise.
On the 1st April 2021 the National Living Wage increases to £8.91 an hour (£8.20 in 2020/21).
Previously the National Living Wage was only applicable to employees 25 and over. This has now been expanded to those aged 23 and over meaning some staff members will receive an uplift of nearly 9%. This is a big increase for businesses that may not be prepared.
For a 23 or 24-year-old working 35 hours a week, they will see their gross wage increase by £1,292.20 per year.
For employers, this extra cost needs to be factored in along with the increased Employers National Insurance & Employer Auto-Enrolment Pension Contributions. Even employees aged 25 and over will be receiving a 2.2% hourly pay rise. The full list of changes can be seen in the table below.
Are you prepared for these changes? Do you know the impact on your business, your cash flow, your profits? This will impact every owner or director of a company and so it is essential to look at your remuneration planning. As a new tax year is about to begin, you should make sure you are prepared for all the legislative changes for the up and coming year.
If you're worried about the amount to do and the short time frame - we can help. We understand that no two businesses are identical, so everything that we do is tailored specifically to your needs in order to achieve optimum efficiency and continuing progress toward your goals. If you'd like to make a difference in your business and ensure that you are prepared for the upcoming changes, get in touch with us today.
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