Nine to Five
There is of course Her Majesty's Revenue and Customs. If you're employed the chances are all the niggling administration surrounding taxes etc are taken care of by your company. You may even have a pension set up into which your employer graciously pays . The only record keeping you're likely to have to do is time or work sheets. You'll have paid holidays and you'll have somewhere paid for from where you can work. Also, being in a regular job can mean that life's attendant financial concerns are less troublesome. You're likely to have less of a problem getting a mortgage, a loan or credit cards and a bank account. All in all being employed has quite a few benefits.
If you're one of the millions of self employed or small business owners life can be complicated. First, you have to generate an income. You may well have to rent premises, get insurance, buy stock or try to open a line of credit so you can do any of that. You'll have to advertise, set up a website, social media site(s). And pay taxes. You'll have to have a business plan, cash flow projections, effective ways of ensuring your customers pay you and keep adequate financial records so you can justify to the taxman how little money you managed to make being on call 24/7 and spending more time dealing with extraneous niggles than building up your customer base. If you have the misfortune to employ someone you can double or triple the heartache.
And you may well need to hire an accountant to sort out your tax affairs!
You really have to be motivated to go it alone. So it doesn't help when those who you rely on to help get your business on the road to success and mega fortune shit on you from a great height.
Incident One: When my wife first rented her studio in a business centre the charge she paid, as well as including rent and service charge, also covered a share of the business rates levied on the business centre. Some bright spark in the property company that owned the centre hit on the idea of restructuring the business rates. They got the Valuation Office to value each of the units for the purpose of business rates. This meant that the business centre owner did not now pay business rates on the property. Instead they were paid by each individual business in the centre. We, however, continued to pay the same rental . At a stroke the landlord made a windfall saving of some tens of thousands of pounds.
When we complained about this sleight of hand the landlord pointed out that all of our business premises was of a size which meant they were now exempt from business tax, so we would end up paying no more than we were currently having to dish out. In response to the charge that he was making a windfall profit: he assured us that should the business rate exemption cease he would take that into account in reviewing the rental. The argument that he was depriving the London Borough of Waltham Forest of valuable and much needed income had no effect.
He has subsequently sold the business centre. His undertaking is now meaningless.
Incident Two: The new owners of the business centre unsurprisingly wish to maximise income and reduce outgoing. All of us small businesses in the centre know and appreciate the business sense of that.
Recharging for the use of electricity appears to have been the cause of some concern for the new owner. We don't know how the other units were charged for the use of electricity in each of the businesses, my wife, however, has a meter in her workplace. Each quarter she would be asked to read the meter and pass that reading onto the landlord who would then send her a bill based on the meter reading. Fairly straightforward.
Last October we heard from the landlord's managing agent. They were reviewing the recharging of the electricity costs. Apparently they could not work out how electricity consumption was being recorded for each business unit and there appeared to be no mechanical way of redressing that. We were told that it had been decided to recharge each business on the basis of the area of their unit(s). Those units, however, which had they own meter were to be excluded from these arrangement. Those of us who were metered were to notify the agent of our meter no and provide evidence of our most recent electricity bill. Which we did. This month we received a bill for over £200 in respect of electricity consumption going back to when the new owner took over the building.
I replied, explaining that we had a meter in my wife's unit and that we provided regular readings and were billed accordingly. On that basis we would not be paying the demand.
Yesterday my wife received a formal letter from the managing agent insisting on payment of the arrears they had calculated based on the area of my wife's business space, and threatening further action if payment was not immediately forthcoming.
I phoned the agent. I explained the situation viz a viz our meter. I was told our meter was not a billing meter but a monitoring meter. That I did not understand. What, I asked, was the difference. Our meter appeared to record electricity consumption - it was sealed, the dial rotated and we provided readings when required. It was in my wife's unit. He didn't really have an answer for that other than it might be under recording our electricity use!
He then said they had to recover the full cost of the business centre's use of electricity - that wasn't happening at present. The fairest way to do that was to charge on the area of each unit. I said that might achieve the landlord's aim of recovering his costs but it wasn't fair.
I pointed out that many of the businesses in the centre were in publishing, computing, graphic design etc and use loads of modern technology (computers, printers, scanners, data storage, and networks). These are all energy intensive. My wife on the other hand uses her hands to tambour beads onto materials. Her working methods are pre industrial. The only nod to the 21st century is a kettle and a radio cassette player. To charge her on the basis of average energy cost per square metre was extremely unfair and just plain wrong!
They're going away to reconsider. We are not paying the demand, and I have e-mailed recording our discussion.
Incident Three: My wife also teaches tambour beading in her workroom. She runs a regular Workshop once a month and does one to one teaching as and when. Because of this she has Public Liability insurance. For the past 5 years we have been insured through the insurance broker "Simply Business". Last year we paid just under £200. To renew our insurance they are now quoting over £250.
"Simply Business", is a broker. Their business - the reason why people use them - is to use their panel of insurance companies to get the best quote for their business needs. The fact that you've insured with the same company for 5 years doesn't mean you'll stick with them thro' hell and high water.
This time, "Simply Business" are telling us that the only people that will insure us are the people we've been insured with over the years. Apparently it's their practise not to seek other quotes except from your existing insurer. That's strikes me as a pretty dirty business tactic. If they're a broker surely they should be looking for the best quote for you? Only after I phoned and expressed my disappointment did they provide a substantially lower quote.
As I said at the beginning of this post it's a challenge running a small business. What you don't need is having to cope with rent seekers and rip off artists masquerading as business friendly.
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