Almost everyone has a mobile phone, so why sign up to a business mobile plan?
Is it not easier to get your employees to use their personal phones and reimburse them?
Surely setting up a business mobile plan is just an extra hassle you could do without?
In fact, the opposite is true. A business mobile plan will save both money and time, and adds other advantages to your organisation.
Pay less tax
When you run a business there are so many tax rules to think about, even the most experienced accountant can struggle to keep up.
One peculiarity is that two employees making a call to the same person on the same network will be treated entirely differently by the taxman. It depends on whose name is on the phone contract.
If the phone is owned by the employee but paid for by the business, it’s seen as a perk or ‘a benefit in kind’.
If the phone is on a business mobile plan, it is no longer seen as a perk!
Here is how it works
1) The mobile (or SIM) is on a business contract in the company’s name. The phone is seen as an essential business tool, not a perk. So, it is not taxable as a benefit.
And you can also claim back the VAT. The phone counts as a company asset. As long as the personal use of the phone is ‘reasonable and not excessive’, VAT can be claimed on all costs.
2) Phone contract is in an employee’s name but is paid for by the business. This is now seen as a benefit in kind. Your accountant should include this on the P11D form, and a Class 1 NIC payment must be added to the payroll. And you get no VAT reimbursement.
3) Employee uses own phone but claims on expenses. If you reimburse the monthly phone tariff, you must deduct and pay Class 1 National Insurance and PAYE tax through payroll. Or you can separate out the purely business calls. And, again, no VAT repayment.
Or to keep it even simpler…
Business phone = no tax. Personal phone = tax
Make your accountant’s life easier
With a business mobile package, you receive one monthly invoice, which the bookkeeper inputs into Xero or Quickbooks (or similar software) and that’s that. There’s nothing more to do.
Using personal mobile phones complicates things, especially if all the calls have to be sorted to see which ones are for business and which ones are personal. Then try multiplying this by the number of employees. Life’s too short for doing extra admin.
Maximise your data
If you have a team of people using their own phones, it is inevitable there will be wasted data. Few of us use our full quota each month. And if you do go above your allowance, the extra data used is eye-wateringly expensive.
With a business tariff, you can manage your data efficiently. Minutes can be pooled across users, so heavier users do not exceed limits and there is no wasting of unused data.
Add to this, it is always cheaper to buy in bulk. If you are buying 30 mobiles (and the data) you will get a better deal buying these on a business deal than buying individually.
Keep it consistent
Imagine if all your employees use their own phones.
They will all be on different operating systems such as Apple iOS, Google Android, and Microsoft Windows.
Each will have their favoured brand, from Apple through to Xiaomi. The choices are endless.
Each brand has multiple options. Which iPhone? 7, 8, X, 11 or 12? XRE, SE, Pro or Mini?
And then there are the networks: EE, Three, O2 and Vodafone.
Plus, the plethora of network providers such as Sky, GiffGaff, Tesco, VOXI, Plusnet etc.
Isn’t there an easier way?
Let the experts help
Working with a business mobile phone provider means you can access the best tariffs, phones and networks for your business needs. This makes much more sense than trying to work out a way of integrating a host of individual phone contracts.
At Rubix, we know mobiles inside and out, but the starting point is your business. We will listen to you to find out how your business works and what you actually need. We can offer consultancy and guidance, but most of all we promise to listen.
Then, we can draw on over 20 years’ experience, to find a mobile solution that works for you. One that makes your employees’ jobs easier, which offers all the functionality you need – and saves you money.
There is no set package. You can use any network and any combination of phones, or even just SIM card.
Your direct client relationship manager can offer impartial advice and find a bespoke package that is tailored just for you. And they will always be there when you need support.
Switching to a business mobile plan is easy and cost-effective.
And you can be the bearer of gifts when you dish out those sparkling new business mobiles!
