Rate Setter Introduction. Rate Setter is designed to help firms calculate charge-out rates for every employee within the firm, taking into account fixed business costs and other important factors. It also helps to review charge-out rates and to calculate
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Rate Setter is designed to help firms calculate charge-out rates
for every employee within the firm, taking into account
fixed business costs and other important factors.
It also helps to review charge-out rates and to calculate
earnings packages for employed or self employed advisers.
To close the demonstration at any time hit the Esc key.
Start by listing your business expenses excluding any salary costs.
This helps to ensure that you allow for all the costs of the business.
If you already know the total of these costs you can skip this section.
In the 3 yellow boxes above, add the current
employer NI rate, the starting threshold and
your business costs from the previous screen
Add the information for all staff but initially leave
the charge out rate blank. A proportion of the
business costs have been assigned to each
employee based on their earnings and minimum
charge rates calculated for each.
With the help of these calculations, add a charge-out rate for each employee
By adding the charging rates the anticipated
income for each employee is calculated in
the final column and the Profit / Loss
at the top of the screen has been updated.
You can now amend any of the yellow fields to see
how this will impact on profitability. If the
director increases his drawings to £75,000 he will
need to increase the amount of time he spends with
clients or increase his charge out rate or both.
By increasing the percentage of his client time by
3% to 38% the business just about returns to profit.
but he will also need to increase his hourly rate
if he wants to retain the profitability of the business.
This section deals with recruitment and
existing employee salary reviews.
Simply complete the yellow fields.
Add the additional
Now add some examples of
anticipated income to see how the
this will impact on the profitability of
the business and also what income the employee might expect to receive.
You can now amend these figures to see the impact on business profit along with employee earnings.
This can then be saved or printed.
You can also print a version
without costs to support
a formal offer of employment
to the candidate.
That concludes the demonstration.
Thank you very much for watching.
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