Money which you take from the business to cover your own personal living expenses is known as 'Drawings'. This should not be included here, but will be dealt with elsewhere in the cash flow.
You should give some thought as to the extent and nature of the work that will need to be done on your poultry enterprise and consider whether you need to employ anyone to help you. The Annual Survey of Hours and Earnings (ASHE), which is carried out by the government, gives average weekly wages (national and regional) for a wide range of different types of job. The Survey is available online on the Office for National Statistics (ONS) website.
You should consider whether you will need to employ people to assist in the running of your poultry enterprise. This means the day-to-day duties, such as feeding, collecting eggs, moving eggs from incubator to hatcher and so on.
If you are intending to run a retail side to your business, such as a farm shop, someone will have to be available to make the sales. Also, you may find that you need someone to take telephone orders from customers, although a possible solution would be to use mobile phones and/or providing a fax, email or online ordering system.
If you are planning to supply local businesses, it is likely that you will need someone to make deliveries.
If you plan to have a seasonal aspect to your business, such as fattening turkeys for the Christmas market, you may find that you will need to take on part-time workers for slaughtering and packing.
When calculating employees' wages, don't forget that if appropriate:
- you could use a combination of full and part-time staff. Part-time work is often attractive to parents with children at school. You may find that the amount of admin and clerical work does not justify employing someone on a full time basis
- the National Minimum Wage Act sets a minimum amount that you must pay your employees in England (the Agricultural Wages Order that used to set minimum wages in the agriculture sector in England and Wales was scrapped from 1 October 2013. The Welsh Government now operates its own Agricultural Advisory Panel and there are separate Agricultural Wages Boards in Scotland and Northern Ireland that set minimum wages in the agriculture sector). Workers aged 25 and over receive a Living Wage premium on top of the standard National Minimum Wage
- there is other employment legislation which you should be aware of
- you will have to pay employer's National Insurance Contributions (NICs) and you will have to operate PAYE in 'real time'. You may have to make employers' minimum contributions to an auto-enrolment pension scheme too
In the cash flow, just put the amounts you will actually pay to staff after you have deducted NICs and PAYE - you will show these separately.
Include here the cost of staff pensions.