Why Hiring an Accountant is a Smart Move (And What to Watch Out For!)

Running a business is exciting, but let’s be real – keeping track of finances, taxes, and invoices? Not so much. That’s where an accountant comes in. A great accountant can save you time, money, and stress, helping your business grow the right way. But how do you know if you’ve found the right one? Let’s break it down. Why You Should Hire an Accountant

1. Less Stress, More Time for Your Business

Trying to keep up with tax deadlines, receipts, and spreadsheets? That’s hours of your life you’ll never get back. An accountant takes that weight off your shoulders, so you can focus on running (and enjoying) your business.

2. They Save You Money (Legally!)

A good accountant knows exactly how to reduce your tax bill in a legal and ethical way. They’ll make sure you’re claiming the right expenses and not overpaying HMRC. That means more money in your pocket.

3. No More Tax Panic

Late tax filings? Misplaced invoices? One small mistake could lead to HMRC knocking on your door. An accountant ensures your finances are spot-on, so you avoid fines and sleepless nights.

4. They Help Your Business Grow

It’s not just about taxes. A great accountant can help you plan for the future, manage cash flow, and make smart financial decisions. Think of them as a financial coach, not just a bookkeeper.

5. Peace of Mind

Knowing your finances are in expert hands is priceless. You can relax, knowing everything is sorted correctly and professionally.

Green Flags: Signs of a Great Accountant

If you’re looking for an accountant, here’s what to look for:

1. They Keep Things Simple – No confusing jargon. A good accountant explains things in a way that makes sense.

2. They’re Honest and Transparent – Clear pricing, no hidden fees, and realistic advice. You always know where you stand.

3. They’re Reliable and Organised – Deadlines are met, paperwork is in order, and there are no last-minute surprises.

4. They Understand Your Business – Every business is different. A good accountant takes the time to understand your industry and specific needs.

5. They’re Easy to Talk To – You should feel comfortable asking questions. A great accountant is approachable and happy to help.

Red Flags: When to Be Cautious

1. They’re Hard to Reach – If they don’t reply to emails or calls, imagine how stressful tax season will be.

2. They’re Vague About Fees – A trustworthy accountant tells you upfront what their services cost.

3. They Make Mistakes – Your accountant should be on top of things, not causing more problems.

4. They Push You Into Dodgy Tax Schemes – If they suggest something that seems too good to be true, it probably is. Stay clear of anything that could get you in trouble with HMRC.

5. They Don’t Explain Things Properly – If they confuse you rather than help you, they might not be the right fit.

Final Thought

Hiring an accountant isn’t just about ticking a box – it’s about making your life easier and your business stronger. The right accountant will save you time, reduce stress, and help your business grow.

So, if managing your finances feels overwhelming, it might be time to get an expert on board. A good accountant isn’t an expense – they’re an investment in your success.

Need help with your finances? Let’s chat – we’d love to support your business journey. Tamara Kuzminska - 56 Accountancy

April 2025 Minimum Wage Increase: What It Means for Workers and Employers

A major wage increase is coming this April, impacting millions of workers across the UK. The government has confirmed that the National Minimum Wage (NMW) and National Living Wage (NLW) will rise, benefiting employees while also posing new challenges for businesses.

Let’s break down the key details, the impact on different sectors, and what both workers and employers should prepare for.

New Minimum Wage Rates from April 2025

From April 1, 2025, the new wage rates per hour will be:

• Ages 21+ (National Living Wage): £12.21

• Ages 18-20: £10.00

• Ages 16-17 & Apprentices: £7.55

• Accommodation Offset: £10.66 per day

What’s Changing?

• The National Living Wage now applies to workers aged 21 and over (previously 23+).

• The 18-20 age group is getting a 16.3% increase, one of the biggest jumps in recent years.

• Apprentices and younger workers will also see significant increases.

Who Benefits from the Wage Rise?

This increase is particularly beneficial for workers in industries such as:

• Retail and Hospitality – Many employees in these sectors earn minimum wage, and this increase will improve their take-home pay.

• Health and Social Care – Care workers will benefit from better wages, potentially addressing workforce shortages.

• Apprentices – The new apprentice wage of £7.55 is a substantial rise, making training programs more financially sustainable for young workers.

For a full-time worker aged 21+, this could mean earning around £1,400 more per year.

How Will Businesses Be Affected?

While higher wages support employees, businesses will need to adjust:

• Higher Operating Costs – Employers will need to budget for increased payroll expenses, particularly in sectors with many minimum-wage workers.

• Potential Price Increases – Some businesses might raise prices to offset the extra wage costs, which could contribute to inflation.

• Hiring Challenges – Companies might be more cautious about taking on new staff due to the increased costs.

Employers must ensure they update payroll systems, review contracts, and stay compliant with the new rates to avoid penalties.

Penalties for Non-Compliance

The government takes wage violations seriously. Employers who fail to pay the correct wage could face:

• Fines up to 200% of unpaid wages (capped at £20,000 per worker).

• Public naming and shaming by HMRC.

• Legal action for repeated offenses.

To avoid these risks, businesses should conduct regular wage audits and ensure all staff are paid correctly.

Final Thoughts

This wage increase is a positive step for workers, improving living standards and addressing income inequality. However, businesses must adapt to these changes and find ways to manage rising costs effectively.

Both employers and employees should stay informed and prepare for this shift in the UK job market.

Are you ready for the April 2025 wage increase? Make sure you’re up to date and compliant. Tamara Kuzminska - 56 Accountancy

Employer National Insurance and Allowance Changes in 2025: What You Need to Know.

From April 6, 2025, significant changes to Employer National Insurance Contributions (NICs) and the Employment Allowance will take effect. These updates will impact how much businesses pay in employer NICs and who qualifies for allowances. If you’re an employer, understanding these changes is crucial for financial planning and payroll compliance.

In this article, I'll break down the key changes, their potential impact on businesses, and what steps employers should take to stay compliant.

Key Employer NIC and Allowance Changes in 2025

1. Increase in Employer NICs Rate

The Employer National Insurance Contribution (NIC) rate will increase from 13.8% to 15% for earnings above the Secondary Threshold.

This means businesses will need to budget for higher payroll costs, particularly for employees earning above the threshold. This increase will affect sectors with large workforces, such as retail, hospitality, and care services, where NICs make up a significant portion of overall expenses.

2. Reduction in the Secondary Threshold

The Secondary Threshold—the income level at which employers start paying NICs for an employee—will be reduced from £9,100 to £5,000 per year.

Previously, employers only paid NICs on wages above £9,100, but with this lower threshold, many businesses will see an increase in NIC payments. This particularly impacts businesses that employ part-time or lower-wage workers, as more of their earnings will now be subject to NICs.

3. Increase in Employment Allowance

The Employment Allowance, which allows small businesses to reduce their employer NICs liability, will increase from £5,000 to £10,500.

Additionally, the previous £100,000 eligibility threshold—which excluded businesses with NIC liabilities above this amount—will be removed. This means more businesses will be able to claim the allowance, potentially offsetting the impact of the NIC rate increase.

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How These Changes Impact Employers

These adjustments are part of a broader strategy to increase government revenue for public services. However, they also mean:

Higher payroll costs for businesses – Companies must account for increased NICs expenses in their budgets. Greater financial pressure on small and medium-sized businesses (SMEs) – The lower Secondary Threshold means more employers will pay NICs on lower wages. Potential hiring impact – Some businesses may reconsider new hires or salary increases due to rising employment costs. More businesses eligible for Employment Allowance – The increase in the allowance could help offset some of these costs, especially for small businesses.

What Employers Should Do Next

To prepare for these changes, businesses should take the following steps:

1. Review payroll systems – Ensure that payroll software is updated to apply the new NIC rates and thresholds correctly.#

2. Assess financial impact – Calculate how much more your business will be paying in NICs and plan accordingly.

3. Consider claiming the Employment Allowance – If your business qualifies, this could help reduce NIC liability and offset increased costs.

4. Seek professional advice – Consulting an accountant or payroll expert can help ensure compliance and identify potential cost-saving opportunities.

5. Stay informed – Regularly check HMRC updates for any further announcements or clarifications regarding these changes.

Conclusion

With the 2025 changes to Employer NICs and allowances, businesses must be proactive in understanding their financial implications. While the increase in NIC rates and the reduction in the Secondary Threshold will raise employment costs, the expanded Employment Allowance offers some relief, particularly for small businesses.

Employers should act now to update their payroll processes, adjust budgets, and explore potential savings opportunities. Staying informed and prepared will help businesses navigate these changes effectively.

Tamara Kuzminska