Money that 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.
Before you can make an estimate of any wages you will pay each month to your employees you will need to identify the work that must be done and how many people - if any - will be needed to do it.
You may need staff to:
- answer the phone, make bookings, order cleaning equipment and materials and so on
- carry out valeting work
- carry out steam cleaning and paintwork repairs if you offer these services
- deal with and advise customers
- keep the business records and attend to other administrative jobs
- collect and deliver customers' cars (if you decide to offer this service)
The wages you pay your staff will depend to some extent on what is the going rate in your area. 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 could use a combination of full and part-time staff. Part-time work is often attractive to students, other young people, and parents with children at school
- the National Minimum Wage Act sets a minimum amount that you must pay your staff. Workers aged 25 and over receive a Living Wage premium on top of the standard National Minimum Wage
- there is employment legislation that 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
Be aware that as an employer you have a legal duty to check that someone you employ has the right to work in the UK.
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. Also include here the cost of staff pensions.