How can I reduce the ancillary wage costs?
February 4, 2022 | 40,00 EUR | answered by Elvira Klinger
Dear tax consultant,
My name is Clara Winterberg and I am the managing director of a medium-sized company in the IT industry. In recent months, I have noticed that our ancillary wage costs are continuously rising and make up a significant portion of our personnel costs. This development is concerning to me as it burdens the financial situation of my company and could have long-term negative effects.
The current situation is that ancillary wage costs make up a considerable part of our budget, and I am concerned that they could continue to rise in the future. I have already considered various options to reduce costs, but so far I lack a concrete plan on how to best implement this.
Therefore, I would like to seek your advice: What measures can I take to reduce the ancillary wage costs of my company? Are there any tax optimization opportunities or other solutions that I may have overlooked? How can I ensure that the reduction of ancillary wage costs does not come at the expense of my employees and is in line with applicable laws?
I look forward to your expertise and thank you in advance for your support in optimizing our ancillary wage costs.
Sincerely,
Clara Winterberg
Dear Mrs. Winterberg,
Thank you for your inquiry regarding the reduction of ancillary wage costs in your company. As a payroll tax accountant, I would like to show you some possible measures you can take to reduce costs without disadvantaging employees or violating applicable laws.
Firstly, it is important to analyze the structure of ancillary wage costs in your company and understand which items make up the largest share. Often, social security contributions account for a significant portion of ancillary wage costs. It may be beneficial to consider alternative insurance models or look for cheaper providers to save costs.
Furthermore, you should also consider the option of company pension schemes. By setting up such a provision for your employees, you can not only take advantage of tax benefits but also ensure their long-term financial security. This can help to retain employees in the long term and reduce turnover.
Another approach is to optimize work processes and procedures to work more efficiently and thus reduce personnel costs. By implementing digital solutions, automating tasks, and optimizing working hours, you can increase productivity and save costs.
It is also advisable to regularly review the wage structure in your company and make adjustments if necessary. Through a fair and transparent compensation policy, you can ensure that employees are motivated and satisfied without unnecessarily increasing costs.
Lastly, I want to emphasize the importance of always acting in compliance with applicable laws. Therefore, I recommend keeping yourself informed about current legal changes and, if necessary, seeking professional advice to avoid legal risks.
I hope these tips help you to reduce ancillary wage costs in your company and look forward to being able to support you with any further questions.
Best regards,
Elvira Klinger
