Ground rules for joint ownership
My wife and I are buying a restaurant and will both be working full time in the business. We were originally going to buy it in my name and simply pay her a market rate for the job, but a friend suggested we should pay her a nominal sum instead (£55 per week) to save on national insurance. Is this a good idea?
Your question raises difficult issues and it is essential you take professional advice before proceeding. Here are a few ground rules.
If you pay your wife the "market rate", then the likelihood is that this salary will attract both employee and employer national insurance contributions. At worst, these can amount to some 20% of salary (albeit with tax relief on your share) so it is worth investigating means to avoid this.
A salary of, say, £55 per week would achieve this aim, although your wife would in all probability lose her entitlement to certain state benefits, since she will no longer have national insurance contributions credited to her account.
More importantly, if the profits of the business are such that you are paying the top rate of tax, then by paying her a lower salary, all you are doing is paying more tax at 40% while she pays less at 24%, 20% and maybe even 0%. The exact figures depend, of course, on the level of profits, as well as any other sources of income.
One way round this would be to make your wife a partner. This can, in certain circumstances, achieve the national insurance savings you seek. Further, not only will it not necessarily increase the tax burden, it can also offer scope for further planning.
Last time my engineer called, he told us not to turn off the water-softening machine. I am not happy about leaving electrical appliances on overnight unless absolutely necessary. What should I do?
In this case, you will have to bite the bullet and leave the water softener switched on. Your softener has a regeneration unit set to operate outside normal hours so the process does not affect water pressure to the equipment it supplies.
If you keep turning the machine on and off, the internal clock will be reset. After a few days, you will find that the regeneration period will take place during the day, when maximum water pressure is required by your dishwashers and other machinery. This will undoubtedly hinder your equipment's performance.
I recently sent my CV to a number of agencies and have been inundated with calls telling me of job opportunities. As I am working, I can't attend interviews at all the suggested venues. How can I prioritise these and cut down the number of calls I receive?
Write down the essential points you are looking for from your next move - location, type of establishment, salary, etc. Then call the agencies and tell them what features you have decided upon as "essential". Ask for information on any jobs (brochures, menus, maps, job descriptions) and make sure these meet your requirements.
Once you have received the relevant information, call the consultancy dealing with the most suitable positions and ask it to arrange interviews, giving dates and times you are available.
Remember to call those companies whose jobs you have rejected.
My restaurant depends on passing trade. How can I ensure that customers return?
The easy way is to provide excellent service at a reasonable price.
Another way in which to build brand loyalty is to offer something for nothing. When the client pays the bill, offer him or her a special two-for-one offer in the evening - say, Mondays to Thursdays.
Alternatively, you could offer a voucher saying: "Pass this to a friend and, on him (or her) having a meal at the restaurant, you will receive a free bottle of house wine when next you dine here."
You could offer a free gift, or discount vouchers to be used in shops or outlets locally. You are thus passing trade to your local business community and, with luck, they will be doing the same for you.
