INSIGHTS

Advice for Entrepreneurs: Hiring Your First Employee

As an entrepreneur, you are more than a business owner. From CEO to CFO, creative director to technical support, you are everything! But, when you see the hard work pay off as business streams in, you will come to realise that your business is growing and you can’t do it alone anymore. If this is you, is it time for a new hire?

Where To Start

Behind every growing business is the business plan it began with. Hiring your first employee comes sooner for some, but it all depends on the potential gaps in skills and knowledge identified in your initial planning. Identifying what these are, which skill is the most critical, and which can potentially be outsourced will guide your decision.

MMS Cloud Accounting offers a range of accounting packages tailored to suit the realistic needs of small businesses – by finding the sweet spot of providing the support these businesses require, with a service they can afford. Through the quality of our insights, we assist our clients in assessing whether hiring a new member for their team is financially viable in their current state and whether it will benefit their business in the long term.

Recruiting The Best

Identifying where you need assistance is only the start! Once you have determined which roles you need to fill and whether your business can take on a new hire, you should consider the following:

How much can you afford to pay?

How will you attract and identify possible candidates?

What will you ask during the interview process?

How will you verify their employability?

What will you need to provide to fulfil the terms and conditions of their employment?

Entrepreneurship Tip: Assessing how much you can afford to fulfil these skills can also help determine whether outsourcing may be a better solution for your needs.

SARS Compliance for the new hire

Should you hire an individual to fulfil your needs, you will have 21 days to inform SARS. This is done by completing an EMP101 form and registering for Pay As You Earn (PAYE), Skills Development Levy (SDL), and Unemployment Insurance Fund (UIF). These three deductions must occur monthly on your employees’ salaries, and the total thereof must be paid over to SARS by no later than the 7^th of the following month.

More about these deductions:

The PAYE deduction is dependent on the amount your employee earns annually. UIF is calculated as 2% of their total salary, where 1% is deducted from the employee’s remuneration, and the business is liable for the other 1%.

Growing Your Business

With the nitty gritty handled and your employee settling in, all that is left to do is train and induct your new hire to ensure that they understand your business’s vision and mission and how they fit in to make it a reality!

The financial professionals at MMS Cloud Accounting are trained to work alongside small business owners to maximise their success. We equip entrepreneurs with actionable financial insights to facilitate informed recruitment decisions.

For more information about our affordable accounting packages, please get in touch with our team.