Why is it so difficult to find employees?

You are absolutely right Aka there are plenty of them around here. It's not fair at all on those people trying to run legitimate cleaning businesses.

But GillT57 cannot say that because she runs a business with turnover over £79,000 and therefore has to charge VAT, she cannot afford to pay her staff more.
And it's a bit insulting to suggest that everyone who employs a private cleaner paying £12.50 or £10.00 per hour is supporting the black economy.
I could equally say that she is living off other people's hard work.
Oh, and I've run two businesses myself, and done all the cleaning in both, and it's hard work.

Surely if you employ people the aim is to benefit by their hard work otherwise there is no point in running your own business?

I would still like to know where in the country GillT57 has her business as she wouldn't get anyone working for that rate where I live.

They pay their tax. They're obsessive about being legit. They don't employ anyone else.
Strangely, most of their employers are connected with the local church.
They look after several people with senile dementia.

Nor here!

Just so that nobody gets the wrong idea from durhamjem, the vat threshold is for turnover over £79,000 not profit. And yes, I suppose I am saying that the vat does affect what I can charge, and thus pay my staff, people look at the bottom line, they don't think 'oh it's ok, 20% of this is vat' If I employed fewer people, maybe fired four or five of them, then I could go under that vat threshold and pay my staff more. I don't think so. It is a tricky balance, and do remember that small business owners are not responsible for the hike in living costs, the extortionate amount that people pay in rent and all the associated factors affecting the cost of living. And I find the statement about living off other people's hard work truly hurtful, durhamjem did you really have to say that?

Not sure what you mean durhamjen? Are you agreeing with the OP or disagreeing? You are right when you say that you must register for VAT with a turnover of over £79,000 although I know plenty of people who turn over much more than this but deal mainly in cash so don't declare it. It is surely up to the individual how much they pay/can afford to pay their cleaner but if they are knowingly paying cash in hand then they are supporting a black economy. Surely no-one runs their own business as a charity and would therefore expect some kind of income from doing so. However I can totally understand how the tables can easily turn and the employee is quite often the person holding all the cards while the employer runs faster and faster in order to stand still.

Perhaps it's the North/South divide Galen .

galen bit confused by your post? What has Church and /or senile dementia got to do with it? Or has this been mis posted? My business is in the Colchester area, sorry wasn't being evasive, but feeling a little persecuted tonight to be honest.

Exactly, Galen. It's offensive to suggest otherwise. My first business I paid VAT. The next one I made sure I did not. I did not want to be a tax collector for the government. But I made sure that the staff I employed earned enough to be covered by NI, so they got sick pay and pensions.

Anyway, GillT, you are self employed running your own business. Why are you saying that other people should not be self employed cleaners?
Gillybob's business is different. Not everyone can be a self employed engineer.

Our business is conducted on a business to business basis. We do not deal with the public and no cash changes hands ever (mores the pity). We charge VAT on all work we do and the businesses we work for will reclaim this via their own VAT returns. The problems for a small business doing work directly for the public (just above the threshold) is that they are forced to increase their charges to the customer by 20% in the £ which is a lot of money.

Gillybob, I'm on the side of the oppressed worker being expected to live on less than the living wage. And it's not the North/ South divide.

What are you talking about ? I am not a self employed engineer Durhamjen Yes we are an engineering company but no-one within the company is self employed !

Oh durhamjen i did not say that other people should not be self-employed, I just pointed out that as a small one person or 2 person business it is easy to be paid cash and not have all the associated costs of running a bigger vat registered business. I know of many business who keep their turnover below the magic figure, but maybe I am not a creative enough book keeper, I have an audit trail from timesheet to payroll to invoice. I think the vat threshold should be raised to encourage more business to hire people without the penalties of crossing that magic figure.

I realise that, Gillybob. If you are going to collect VAT for the government you have to take £100,000 to allow for the VAT.
But businesses like cleaning and windowcleaning and painting and decorating can quite easily be split so that each person runs a different area and takes less than £79,000. Saving a lot of hassle.
Surely your company also claims VAT back on the goods you purchase?
As will GillT's business.

durhamjen the "living wage" is a load of tosh. There is no way most small businesses in the North east could pay a "real" living wage to every employee. The economy just couldn't take it and unemployment would skyrocket. I wonder what you consider to be a living wage anyway?

Yes obviously durhamjen but the point I was trying to make was that we do not work for the public. We work business to business. It is only when you work for the public that the VAT threshold makes a huge difference. It is very hard for someone (legitimate ) over the threshold to compete with someone under the threshold (legitimate or otherwise) .

I pay cash in hand to my window cleaner. He charges £5 and I have suggested every year that he puts it up. He does not want to as he is happy not collecting VAT for the taxman. He pays tax and national insurance - I have asked him - and pays them for his son who works for him. If he put the price up he would have to split the business between himself and his son, but would lose the help. His son climbs ladders, and he prefers not to.

Interesting discussion everyone. Goodnight all.

sorry galen just read back and realised you were referring to the couple who do work for you, sorry, it got a bit out of order! I obviously do claim back vat on things that are legitimately purchased for the company, but there isn't much to be honest, just on my accountants fees, the odd bit of equipment, phone bill and such, doesn't amount to anything near what I charge out and have to collect. Also, HMRC are very hot on splitting businesses to keep them under the vat threshold, I did think about it, but couldn't be done. I also wonder how many of you have asked the staff at your supermarket checkout what they are paid? It will be just above the minimum wage, and just look at the profits their employers make! And the tax advantages they can afford to pay for......do you know that I pay more corporation tax than The Ritz hotel? and so do you gillybob......because they don't pay any!

In which case GillT you should be fighting for everyone to pay their tax, rather than criticising people for not wanting to work for you for less than the living wage.
www.jrf.org.uk/blog
Joseph Rowntree Foundation take on the minimum and living wage.
Living wage £7.65 an hour, £8.80 in London.
Even Boris knows what the living wage is, Gillybob.

www.livingwage.org.uk

I too pay my window cleaner £5, he has been cleaning my windows for 42 years and I am dreading him announcing his retirement.

Do we have the same window cleaner? You live Tyne and Wear and I live Durham area. Highly unlikely, I would think. That would be a big round.

I am so glad that I don't pay VAT any more.