Planning to improve your financial health this tax year?

Here at Waller Transport Services, we are all about solutions. We like to plan, prep, and organise. We make sure you are working as effectively and productively as possible, throughout the year.  

For some hauliers and freight services, the start of a new financial year offers a bit of breathing space. It gives firms a chance to look up from end-of-year reporting and know what to expect from the next twelve months.  

We see the start of a new financial year as an opportunity to look ahead and plan. Like the new year’s resolutions many of us start each calendar year, we see the new tax year as a chance to install better financial habits. With more preparation, better budgeting and more awareness of how important long-term planning is, your business could be in a much better financial shape and working more efficiently. 

Here are a few things you should be aware of during the 2023-2024 financial year.  

You could be impacted by the corporation tax change. 

Now we are in April 2023, businesses are officially working under new corporation tax rules. In his Spring Budget, Chancellor Jeremy Hunt confirmed firms with taxable profits exceeding £250,000 will pay a 25% corporation tax rate.  

Firms with taxable profits below £50,000 will remain at 19%, while those caught between £50,000 – £250,000 will pay rates on a sliding scale between 19% – 25%. 

Clearly, your finance department will be aware of this, but you need to be able to put this into context for your ongoing income and expenditure. If you pay additional corporation tax, will this be impacting your day-to-day budget?  

Are you paying attention to your capital expense planning? 

We all know to keep a close eye on capital expenditure to make sure we’re not spending money on things we don’t need to and the start of a new tax year is a good time to try to improve your budgeting for upcoming costs.  

For example, when was the last time you reviewed your contracts with suppliers or negotiated prices? In today’s escalating costs, every penny helps to ensure the smooth running of your business.  

Don’t forget your asset management plan. 

Within the haulage sector you may be focusing heavily upon changing legislation, issues caused by Brexit or even driver retention. But it’s also essential to look closely at your fleet of vehicles. For instance, when was the last time your fleet was serviced? Are you actively monitoring fuel efficiencies and depreciation?  

Paying close attention to this now (even if you have a relatively new fleet) could allow you time to focus on your asset management plan. You can schedule when repairs or replacements are likely to be needed. From a financial perspective, this will allow you time to plan for the increased financial expenditure. But, logistically, being aware of when improvements are needed will allow you to schedule at a time that suits your business.  

Make it a priority to focus on your cashflow and VAT. 

There are still huge cashflow issues for haulage and logistics firms, with many problems caused by global supply chain issues.  

There are ways to improve your business’s cash flow. For example, submitting VAT returns every month instead of every three months could bring in more cash because HMRC can give VAT refunds faster. This might be a promising idea if your business buys goods and services with standard tax rates but sells a lot of goods with zero tax rates.  

However, if this is something you think could help your business, you need to weigh up the balance between quicker access to cash, and more time spent on the admin/paperwork activities. If the productivity involved in filling out extra VAT returns exceeds the money you may get back, it might not be the most efficient use of time or productivity.  

Look ahead to Q2 and Q3. 

Logistics firms and hauliers need to be continuously looking ahead to the future and planning for what is next on your work schedule.  

From an operational perspective, looking ahead now to the summer will allow you to confirm any annual leave requirements from your drivers, or your wider teams. Can you look at what work you have scheduled and confirm you have enough people to cover those on holiday? If not, you might need to budget for any agency workers or request annual leave dates are changed.  

Looking ahead beyond your existing workload is essential preparation because it allows you to work more effectively. You can plan for any changes in working capacity, while also making sure you can predict additional traffic loads or any other issues that could impact on your logistical operations.  

Planning ahead is also about recognising if you have an aging workforce. 

When was the last time you looked at your workforce to identify if you may have any changing workplace needs?  

There is a known haulage driver shortage and two years ago, in June 2021, the ONS reported that “The number of people employed as HGV drivers in any industry has fallen by 53,000 in four years” 

Combined with the Road Haulage Association stating that “the average age of an HGV Driver is 55, with less than 1% under the age of 25” it is clear driver levels remain at critical levels. If a significant proportion of your workforce announced plans to retire, would your business be able to cope?  

You must regularly check in with your staff to determine any potential retirement plans as part of your succession planning. Do you have plans in place to train a new replacement in the event a senior member must leave soon? Although finding the right balance in hiring is never easy, being proactive can help your business run smoothly. 

Waller Transport Services are here to help improve your business. 

We are here to work with logistics and haulage companies to help improve your efficiencies. We can take care of everything, from handling the bureaucracy involved in international import/export shipments to assisting in avoiding needless delays and guaranteeing pallets are delivered securely and on schedule. 

We believe no haulier should be on the road empty. Work with us to ensure your vehicles are running at capacity. 

To find out more about how we work and what services we offer, call us right now at 01473 245 717.