Are you ready for the National Living Wage?

With just a month left before the new National Living Wage is introduced, Bradford-based accountants Watson Buckle are encouraging employers to get the correct payroll processes in place.

From 1 April 2016 employees over the age of 25 who are currently earning the minimum wage rate of £6.70 per hour will see a 50p increase in their pay, bringing it to £7.20 per hour.

The average full-time worker in this pay bracket, working 35 hours a week, will see their pay packets rise by more than £900 a year.

This rate looks set to increase further over the next four years, eventually reaching £9 per hour by 2020.

This significant increase in workers’ pay is likely to have a substantial impact on business’s wage costs and is also likely to place an additional burden on their payroll systems.

Susan Sedgwick, Managing Director at Watson Buckle, said: “Paying your employees the correct wage is extremely important.

“Failing to pay the correct wage will not only create animosity amongst your workforce, but could also land you with a hefty fine and lead you to be named and shamed by the Department for Business, Innovation and Skills, which could do significant reputational damage to your firm.

“It is inevitable that this new wage increase will have a significant effect on your business’s profits in the months and years to come, so now is the time to assess where savings can be made within your company.”

Susan added that certain industries such as the care sector, retail and hospitability, which employ a large number of low paid staff, would be affected most by the changes and would need to consider what actions need to be taken to ensure their ongoing success.

Yorkshire business owners are being urged to consider the implications of major new transparency rules being imposed on nearly all UK companies from April 2016 to combat tax evasion, money laundering and financing terrorism.

The Small Business, Enterprise and Employment Act 2015 – designed to boost trust and promote the UK as a sound business and investment destination – will clarify legal and beneficial ownership.

Michael Cantwell, a partner in the Corporate Department of hlw Keeble Hawson, said: “From this April business owners must keep a register of all people and companies – PSCs – that have a ‘significant control’ over them. This includes those holding more than 25% of the company’s shares or voting rights – along with anyone who has the authority to appoint or remove a majority of the board of directors.

The legislation could hit some firms badly in other ways – for example where PSCs have notoriety or if they work with other, controversial enterprises and customers shun them as a result.

Company officers must take all reasonable steps to pursue PSCs or risk fines or up to two years’ imprisonment and they can impose heavy sanctions against anyone who does not cooperate. Businesses are responsible for collating and compiling a register as well as maintaining and updating records as changes occur.

Michael Cantwell added: “The true impact of the PSC Register remains to be seen – and many companies will be affected in different ways. There is still time to prepare by finding out precisely what obligations you will have, your powers of enforcement – and how you must demonstrate that you are complying from April.”