The new 2022/23 tax year began in April, and this is the best opportunity to take a fresh look at your approach to your London business finances and be prepared for the months ahead. There’s plenty of increases and changes to consider over the coming year, and it’s important you start the year off right.

From National Insurance threshold changes and overall increases, to National Minimum Wage increases and thresholds rising, as a business owner or finance manager it’s important to know what’s coming up and when. Similarly, a new tax year is a great opportunity to begin to put into place processes to help your business debt recovery.

National Insurance

National Insurance rates increased by 1.25 percent from 6th April 2022. This increase is part of the UK Government’s plan to create a health and social care levy, and contribute to funding and supporting social care and the NHS. The additional funds are taken alongside usual National Insurance contributions in 2022-23 but it is anticipated that the levy will be taken separately from April 2023.

In July 2022, the lower earnings limit for National Insurance is set to change from £9,880 to £12,570. This has been implemented in order to offset the rise in rates payable, however the upper earning limits will remain at £50,270. For employees, this means they are able to keep more of their money before they pay their National Insurance contributions.

National Minimum Wage

As a business owner, every year it’s important to keep an eye on the National Minimum Wage increases. The new rate for 2022-23 for all employees aged 23 years or older will increase from £8.91 an hour to £9.50. It’s also important to see the increases for other age and employment brackets, such as 18+ and apprentices.

Your London Business Debt Recovery Process

While January 1st is everyone’s ‘New Year, New Me’ it’s important to keep this mindset for the new tax year on behalf of your business. Things can and do fall through the cracks, such as missing payments or late invoices.

You will find it valuable in the short and long term to begin to implement your business debt recovery processes sooner rather than later. Your debt recovery should involve taking action right away, acting swiftly in order to make it easier for clients to settle their balances.

Your debt recovery process may involve sending letters to begin with, but it’s important to know when and how to escalate should you require it. If your client just will not pay, you can partner with a debt recovery agency who knows exactly how and when to take the correct action.

For more information on how K2 Collections can help your debt recovery in 2022-23, get in touch with us today and we’ll be happy to help you.