Published on: 10 January 2019
Last Updated on: 24 February 2020
If you have decided to make a career in the home healthcare aide industry or set up a home healthcare aide agency, you already have a fair idea of how to set up your business. You know what kind of qualifications you need, or you must seek in your employees, and know what inherent qualities, such as compassion and patience, are needed to succeed in this field. However, many HHA agencies start out without a comprehensive insurance plan covering them, and this can prove to be a dangerous lapse.
Take a look at some facts that were outlined in a report by NERA Economic Consulting, commissioned by the U.S. Chamber Institute for Legal Reform.
In the year 2008, small businesses in America paid up a total of over $105 billion towards tort liability.
Small businesses absorbed about $35.6 billion of tort costs and paid from their funds, not through insurance.
Medical malpractice costs plus other tort liability cost for small businesses amount to over $133.4 billion.
The fact is that no small business owner wants to think about being dragged into a lawsuit when they are just about to embark on the business, but this is not something that can be ignored. The potential costs are simply too high, and they can push your fledgling business to the brink of ruin. Remember that letting a claim go unchallenged is not a very good option for you either, since your inaction may be taken as an admission of guilt by potential/future clients. This could impair your future business drastically. Given the disastrous consequences that a lawsuit against your agency can have, it makes business sense for you to get insurance cover in place as one of your top priority items when you set up your HHA agency. This also true if you are setting up a non-medical HHA agency. In fact, take a look at this step by step guide to setting up such an HHA agency, and you will see insurance coverage listed here as one of the critical tasks to do.
Can liability insurance cover you effectively?
The answer is a resounding YES! A savvy business owner knows that insurance is a simple, effective way to protect the business financially. Legal issues tend to run up bills that can be huge, even if you can prove your innocence and do NOT have to pay damages. There are costs associated with fighting your lawsuit, remember, and without the right insurance in place, it is your business that absorbs all these costs. To prevent this, you need to opt for the right kind of insurance plans to cover all your bases. Take a look at what you need:
General liability insurance explained: This is broader base insurance that is often referred to as business liability insurance. For example, if your aide accidentally damages some medical equipment that is at the patient’s place when they are operating it, this insurance may kick in to cover any costs arising from legal claims made against you for property damage or bodily injuries resulting from your services or operations.
Malpractice liability explained: This insurance coverage kicks in when a claim is made against services you or your aide have provided. There may be patients or family members of patients alleging that you/ your aide were negligent in duties or there was a failure to perform services as claimed or that you gave wrong advice that led to some detriment to the patient. In any such situations where you are accused of a lapse in medical care that has led to some harm to the patient, your malpractice liability insurance helps cover the risk.
Wrap:
Knowing how your insurance plan protects your business helps you tackle legal claims with confidence, challenging allegations that are falsely made against you. Talk to your insurer and understand the many benefits that your insurance plan provides because this may be your lifesaver in a challenging situation with a client.
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Small business owners face numerous considerations when deciding whether to purchase or lease a business facility.
Once a business owner identifies their specific facility requirements and successfully locates the ideal property, they encounter another crucial choice: Should they buy or rent the property?
This decision arises in two distinct scenarios: First, when the owner of the desired property is open to either selling or leasing it, and second when you have multiple options, some available for purchase and others for lease.
To make this decision confidently, it's essential to evaluate the financial aspects and the determining factors that influence the suitability of leasing versus buying a business facility.
Comparing The Economics Of Leasing Vs. Buying
What should you go for when it comes down to lease vs buy for business?
In business decisions, few choices are as pivotal as determining whether to lease or buy assets. This holds for many assets, from real estate to equipment, vehicles, and more.
This decision can have significant financial implications for business owners, and understanding the pros and cons of leasing versus buying is crucial for informed decision-making.
Let’s explore the economics of these two options, exploring the advantages and disadvantages of each to help business owners make the right choice for their specific circumstances.
The Economics Of Leasing
Leasing, as a financial arrangement, is a concept that extends beyond the realm of property and includes various assets such as vehicles, equipment, and even software.
At its core, leasing is a method of obtaining the use of an asset for a specified period while making regular payments to the asset's owner, whether it's a lessor or a financial institution.
The economics of leasing involve several key factors that affect the decision to lease rather than purchase outright.
One of the primary economic benefits of leasing is the conservation of capital. When you lease an asset, you avoid the substantial upfront cost of purchasing it. This is particularly advantageous for businesses, allowing them to allocate their capital to other essential operations or investments.
For individuals, it means not having to deplete their savings to acquire a costly asset, whether it's a car, a piece of machinery, or even a home.
Leasing often offers more predictable and manageable cash flows compared to outright ownership. Lease agreements typically involve fixed monthly payments over the lease term, making it easier to budget and plan for expenses.
Tax benefits can also make leasing an economically attractive option. In some cases, lease payments are tax-deductible as a business expense.
This can lead to significant tax savings for companies. However, tax benefits can vary depending on the asset being leased and the specific tax regulations in place.
However, There Are Economic Drawbacks To Leasing As Well:
Long-Term Costs: Over an extended period, leasing can be more expensive than buying, primarily due to the cumulative cost of lease payments.
No Equity Buildup: When you lease, you do not build equity in the asset. It remains the property of the lessor.
Limited Control: The lessee must adhere to the lessor's terms and conditions, which can be restrictive.
The Economics Of Buying
The decision to buy an asset, whether a property, a vehicle, or any significant investment, is a fundamental economic choice with both immediate and long-term financial implications.
Understanding the economics of buying involves considering various factors that impact the purchase decision and how ownership affects one's financial situation.
One of the central economic aspects of buying is the upfront cost. When you decide to buy an asset, you typically need to pay the full purchase price, which can be a substantial one-time expense.
This upfront payment represents a significant commitment of financial resources and can affect your liquidity, especially for big-ticket items like real estate or high-end machinery.
Buying an asset often means having complete control and decision-making authority over it. You can customize, modify, or use the asset as you see fit.
This sense of ownership can be economically empowering, allowing you to tailor the asset to your specific needs or preferences.
Mortgages and loans are common financial instruments for buying high-value assets like real estate or vehicles. These arrangements enable individuals to spread the cost of the asset over time.
While loans may involve interest payments, they make the purchase more accessible and can be financially strategic.
However, Buying Also Has Its Economic Downsides:
Higher Initial Costs: Purchasing assets often requires a substantial initial investment, burdening businesses with limited capital.
Risk of Depreciation: Some assets, like vehicles and certain equipment, can depreciate over time, impacting their resale value.
Maintenance Costs: Owners are responsible for maintenance and repairs, which can be costly.
Reduced Flexibility: Selling owned assets can be time-consuming and might not be feasible in rapidly changing business environments.
Factors To Consider When Making The Lease Or Buy Decision
The lease vs. buy decision is critical and can significantly impact a business's financial health and long-term prospects. To make an informed decision, business owners must weigh several important factors.
Here are key considerations to keep in mind:
Financial Considerations
The financial aspect is often the cornerstone of the lease or buy decision. One of the initial considerations is the upfront costs. Buying a property typically involves a substantial financial commitment, including a down payment, closing costs, and potential expenses for renovations or furnishing.
On the other hand, leasing usually requires a security deposit and the first month's rent, which are notably lower than the upfront costs of buying. Another critical financial factor is the monthly expenses associated with each option.
While leasing tends to result in lower monthly costs than buying, owning a property often entails higher mortgage payments. However, these payments contribute to building equity in the property.
Additionally, the potential for property appreciation is a financial consideration, as owning a property allows you to benefit from the property's value increase over time. Conversely, leasing may increase annual rent, impacting your financial planning.
Lastly, the tax implications are significant. Property ownership can provide tax benefits, such as deductions for mortgage interest. In contrast, leasing does not offer these tax advantages but may simplify financial management.
Long-Term Goals
Your long-term objectives play a pivotal role in the lease or buy decision. Buying might be the more suitable choice if you are interested in benefiting from property appreciation and potentially selling the property for a profit.
On the other hand, if flexibility is a priority, such as the ability to relocate or change your living situation without the responsibilities of property ownership, leasing provides greater adaptability.
Understanding your long-term goals is crucial in deciding to align with your aspirations.
Responsibilities and Maintenance
The responsibilities and maintenance associated with each option are essential factors to consider. Property maintenance costs, such as repairs and upkeep, are the responsibility of property owners.
Leasing, however, often shifts these responsibilities to the landlord responsible for maintaining the property. Moreover, property ownership allows for customization and renovation, allowing you to modify the property to your preferences.
In contrast, leasing may come with limitations on modifying the property, as any alterations typically require landlord approval. These factors highlight the practical aspects of the lease or buy decision and the degree of responsibility you are willing to undertake.
Market Conditions
The state of the real estate market at the time of your decision is a critical external factor. It can significantly influence the cost-effectiveness of leasing or buying.
Buying may be more advantageous in a buyer's market, characterized by lower property prices and favorable interest rates.
In contrast, leasing might be the more prudent choice in a seller's market with rising property prices, as property prices may be inflated, making buying less cost-effective.
Duration of Stay
Your anticipated duration of stay in the property is a key factor. For a short-term stay, leasing is often a more practical option.
Buying may not provide enough time to build equity and recover the upfront costs of property ownership.
Conversely, plan to stay in the property for an extended period. Buying can be financially advantageous in the long run, allowing you to benefit from property appreciation and build equity over time.
Making The Decision
The decision to lease or buy should be based on your business's unique needs, financial situation, and long-term goals.
Conducting a thorough cost-benefit analysis, factoring in your specific circumstances, and considering how the economics of leasing or buying align with your business strategy is advisable.
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There are countless small things that can be done to show your employees that they are appreciated. Setting your company apart from the next starts with the work ethic and loyalty of your employees. Hard-working and motivated employees are very productive. And as well all know, increased productivity leads to an increase in revenue over time.
Employees flock to companies with reputations of a good work environment and employee appreciation. The best attracts the best if your employees are treated like the best that is how they will perform.
Employee appreciation reigns supreme in the realm of productivity and its time for companies to step it up. Here are some ways to take the employee appreciation to the next level.
Flexible Schedules :
When your team members are willing to go the extra mile for their colleagues time and time again, it is important to let them know that it does not go unnoticed. A really positive way to encourage employees to put forth their best work is allowing flexible schedules. Acknowledging the difficulty of orchestrating all of the components of life along with work is a great way to relieve some stress and recognize ambitious employees.
A flexible schedule is not the same as allowing the employees to control every aspect of their schedule. However, it is a step above having employee schedules being completely dictated by the company. Having slight aspects of flexibility when team members have something come up can go a long way. When employees feel respected as people with busy lives outside of work, they will be far more motivated to go above and beyond in the office.
Communication :
Communicating with your team and making an effort to understand them is one of the most vital steps on the road to success. Society has created a group of professionals who communicate largely through email and text messaging. While these communication mediums are wonderful and have bridged the communications gap in many ways, a lot of sincerity and authenticity can be lost when a message is typed instead of spoken.
Take time to communicate face-to-face with your team members as often as you can. Not only encourage them to do well but get to know them as people. When teams form strong connections their ability to work together increases exponentially.
If you find yourself wondering what the best way to show your appreciation to a particularly hard-working employee, communicate with them. Ask them the ways in which they would like to be recognized for their hard work. Not only will this method of appreciation be a sure-fire way to show the employee how well they are doing, but they will feel respected and valued for being given the opportunity to choose their appreciation method.
Team Retreats :
Whether a team is treated to a simple luncheon or a weekend spent away from the office with their toes in the sand, they will return feeling revitalized, motivated and appreciated. Having small goals like retreats to work towards boosts overall happiness within the company as well as work ethic. It is no secret that working becomes easier when there is a light at the end of the tunnel.
Team retreats can also be a great way to build stronger relationships among colleagues. It is important for employees to feel connected to the company as a whole and appreciated by their peers. Feeling appreciated by everyone you work with and not just the boss can really boost employee morale and make productivity soar.
Bonuses :
Bonuses are no new-fangled recognition tactic. Employees have been receiving holiday bonuses and such for years. But, as they say, if it’s not broken don’t fix it. Bonuses are still a flawless way to show your employees they are valuable to the company.
Bonuses can be given in the name of hard work. When an employee does exemplary work that goes beyond their job description- they should be rewarded for that. If employees know the extra work they are doing is noticed and, most important, appreciated, they are going to be so much more willing to continue with that standard of work.
Advanced Training Seminars :
Employees that are capable are confident. In any given profession there is always room to improve and there are always new skills to master. By offering additional training throughout your employees’ career you show them that the skills and resources that they possess are valuable to the company. It is in your best interest to hone those skills and show your employees that their confidence and their performance are important to the company.
Fostering growth and improvement among your employees is one of the easiest ways to show appreciation. Furthermore, training will greatly benefit the company as a whole by producing able and motivated employees.
Not every sign of appreciation has to be huge; there are countless small gestures you can make as well. However, companies will benefit greatly by really bringing their employee appreciation up to the next level.
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Malta gives owners of Yachts looking to purchase a new boat reasonable savings on VAT. Yachtregistrationmalta.net is recognized by the EU and the vessels will be free to navigate in the waters without restriction and are EU VAT PAID. This registry has extensively grown in the past and has listed prestigious yachts on the sail. Regarding guidelines by the VAT department of Malta, the leasing services supply is taxable basing on the extent of utilizing the yacht within the territory of EU waters.
These guidelines establish a percentage of the lease based on the period that the yacht is in the territorial waters of the EU. The presumptions are tied to the length of the vessel and the propulsion means. The primary requirements are that the vessel needs to come to Malta at the commencement and end of the lease period when the option of purchasing is exercised. The agreement of lease needs to be completed between the lessor as the Maltese company and the foreign company or person as lessee.
Before the approval of the of this agreement, the commissioner of VAT will have to confirm the applicable rate as per the EU territorial waters requirement and the acceptability of the value of the yacht. For this reason, the craft’s valuation certificate is submitted alongside its application to the department of VAT for approval. The VAT and lease installment are payable monthly and the period will not be less than one year and not exceeding three years. It is recommended to choose twelve months.
The lessor of the yacht will make profits from the lease agreement above and over the boat value. The purchase value when the lease agreement comes to an end will not be less than one percent of the value of the yacht and is subject to an eighteen percent standard rate.
It is relevant to discuss the relevant tax benefits applicable under the Maltese government in relation to shipping firms that operate commercial yachts. According to yachtregistrationmalta.net, commercial yachts owned by shipping firms and registered in Malta pay annual tonnage tax in the place of income tax. This option is the most attractive one for clients that are contemplating chattering their yachts for commercial purposes.
The initial VAT paid by the purchaser at the source will not be payable to the supplier of the yacht by the lessor. In this light, there are three probable scenarios that might apply and the result might be refundable or nil VAT on the purchase of the yacht. The scenarios are; you purchase it locally, you purchase it from a member state, or if it is imported in the European Union. Distinct criterions apply on all scenarios and all clients in Malta will get details on all requirements.
The thing that would attract VAT payment is the supply services in the lease agreement. The taxable services are taxable according to the usage of the yacht in the EU territorial waters. Malta VAT is payable on a section of the lease payment made on the leasing company that owns the yacht. The portion is fully dependent on the type and length of the vessel. A yacht with a length that exceeds twenty-four meters will derive high benefits because only thirty percent of lease payments are subject to VAT in Malta.
The department that handles VAT will issue certification for being accounted for by the leasing firm after paying the first VAT installment. The Malta VAT department issues a VAT paid certificate after the lease if the yacht is given to the lessee. The assumption is that the yacht will be utilized partly outside and within the EU water territory. The length of the yacht shows the percentage of its use outside EU waters.
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