CPA Bulletin

32 CPA Bulletin > November 2024 www.cpa.uk.net LEGAL: 3 Changes to vehicle tax for electric and low emission vehicles Top Service - 5 Top Tips for Effective Credit ManagemenT Credit management involves making sure a business gets paid for the goods or services it supplies by checking that the potential customer is creditworthy, then taking all necessary steps to turn the invoices it raises into cash. Put simply, it is minimising risk and maximising cash. Using his credit management experience that spans over decades, Philip King FCICM of Top Service, gives his top tips when it comes to credit management, particularly for SMEs. 1. Understand the Importance of Cash Flow Businesses fail when they run out of cash. A £10,000 bad debt with a 10% profit margin requires £100,000 in sales to recover. Monitoring cash flow and responding quickly can prevent financial trouble. 2. KnowWho You are Supplying It is vital to know a business’s exact status and creditworthiness, as it determines responsibility for debts. Use credit reports and industry insights to avoid bad debt, and do not rely on appearances when assessing customers. 3. Agree on Payment Terms Early Discuss payment terms early, agree on what works for both parties, and confirm in writing. Clarify when the payment period starts and ends, as ‘30 days’ can vary and potentially extend to almost 60 days depending on the timing. 4. Ensure Invoices are Properly Submitted Ensure you know where to send invoices, what details are required, and if a purchase order is needed. Confirm payment schedules and deadlines and build a good relationship with the invoice contact for future assistance. 5. Ask for Your Money If you have invoiced correctly, follow up after submission to ensure it is being processed. If payment is late, ask where it is and escalate if necessary. Be professional, document everything, and clearly communicate the impact of delays on your business. For further assistance on understanding cash-flow, credit management or bad debts, speak to Top Service on 01527 518800 or visit www.top-service.co.uk From the 1st April 2025, drivers of electric and low emission cars, vans and motorcycles will need to pay Vehicle Excise Duty (VED) in the same way as drivers of petrol and diesel vehicles. This change will apply to both new and existing electric vehicles. The newmeasure effectively removes band A under the existing VED systemwhich is currently £0. Vehicles in this band will be required to move to the first band where a rate becomes payable. Most electric vans will move to the standard annual rate for light goods vehicles.