Courier Business Stuff

Plan your route. Don’t just rely on your Satnav; sometimes there’s a much more direct, shorter and quicker route if you just glance at your map.

Avoid buying fuel (or anything) at motorway services. If you’re caught short for fuel (or anything else) try Cheap Fuel Near Motorway Junctions for conveniently positioned fuel and supermarket sites.

Check your tyre pressures regularly. You’re meant to do this every day for the sake of safety of course. You’re normally meant to increase your tyre pressures slightly when carrying heavy loads and when driving at motorway speeds for long periods. Check your van’s handbook for the manufacturer’s recommendations. Think how much harder it is to pedal a bike with flat tyres than with well inflated tyres.

Close your windows on the motorway. Apparently an open window at 70mph can increase your fuel consumption by nearly 10%.

Drive smoothly. Change up early, don’t race away from the lights in low gears, read the road ahead of you and try to avoid coming to a stop. Keeping the van moving slowly is far more economical than stop-start driving.

Lose weight. Every bit of extra weight you carry around with you is costing you money. Even carrying a 25 litre jerry can of fuel with you can increase your fuel consumption by 1%. How much of the rubbish you carry around in your van do you really need?

Slow down. Cruising at 80mph rather than 70mph will gain you less than Read More…

Posted under Courier Basics, Vans

So you’ve got your Goods In Transit Insurance (up to say £15,000), you’ve got your Public Liability Insurance (up to say £1 MILLION) and you think you’re pretty much covered for everything, right? Wrong.

Unless you only ever carry goods under your own ‘Terms and Conditions’ or ‘Conditions of Carriage’, which you make available to your customers before you carry out any work for them then you could be wide open to a claim for unlimited damages from your customer or even from your customer’s customer.

Your Goods In Transit insurance might well cover you for £15,000, but what if the goods you’ve collected are worth far more than that? A consignment of computer chips or a pharmaceutical sample can be worth many times that and if it was lost, stolen or damaged while under your control you would be liable for the full value unless your Conditions limit your liability.

That’s not the worst of it though. Most couriers’ Conditions quite rightly disclaim any liability for consequential loss. Without this essential restriction to your liability your losses are potentially unlimited should a late, lost or damaged consignment cause your customer any financial loss due to your ‘negligent act’. A ‘negligent act’ could be as simple as you leaving goods in your vehicle overnight and them being stolen, being late for a delivery because your cambelt broke due to being overdue for replacement, subcontracting your delivery to a muppet or just sending a document by overnight delivery and it being misrouted.

In the absence of suitable Conditions the only defence that you may have against a claim is to be able to prove that your customer’s loss occurred Read More…

Posted under Courier Basics, Courier Business, Courier Financial Issues, Insurance for Couriers, Legal Issues

When you first register for VAT you’re allowed to claim back the VAT on some of the things you paid VAT on before you became VAT registered. The claim should always be made on your first VAT return. HMRC are ‘allowed’ to let you claim at a later stage but they don’t have to do so.

You must be able to provide receipts showing the VAT for anything that you claim the VAT back on in this way. Be warned that HMRC are very likely to ask to see all the supporting VAT receipts if you put in a big reclaim of VAT on your first VAT return. This is nothing to get worried about as long as you’ve stuck to the rules.

You can claim the VAT back on any ‘goods’ that you’ve purchased up to 3 years before your registration date as long as you still have the goods on the date that your registration starts. ‘Goods’ would include vans, computers, promotional material, uniform, fax, telephones and even the tank full of fuel you bought the night before your registration started.

You can also claim back the VAT on any ‘services’ that you’ve paid for up to 6 months before your registration date as long as the service wasn’t one that you ‘sold on’ before your registration date. So you could claim back the VAT on your accountant’s bill from 5 months ago but you couldn’t claim back the VAT that a subcontractor charged you last week if you’ve invoiced your customer for the job before your registration date.

The good news is that you can still claim back the VAT on these pre-registration expenses even if you’ve registered under the Flat Rate Scheme (FRS).

Normally under the FRS you can only claim back the VAT on purchases of ‘capital assets’ costing over £2,000 including VAT; so as far as couriers are concerned usually just on the purchase of a van. When claiming the VAT on pre-registration expenses however you can claim back the VAT on all the purchases mentioned above as if you weren’t on the FRS. So if you were to buy your new laptop 2 weeks before you registered for VAT on the FRS then you’d still be able to claim the VAT back on it. If you bought it just after registering for VAT on the FRS you wouldn’t be able to claim the VAT unless it had cost you £1702.13 plus VAT (£2,000) or more.

The only ‘gotcha’ with regards to the FRS is that if/when you sell anything that you’ve claimed the full amount of VAT back on using the above method (your van for instance) you have to account for the VAT on the sale at the normal rate rather than at the FRS rate. So if you’ve bought your van 3 years ago for £8,000 (plus £1,400 VAT) and claimed back the VAT, then when you sell it next year for £1,500 (plus £262.50 VAT) you’ll have to pay HMRC the full £262.50 VAT when you sell it, rather than £135 under the FRS.

Given that you’ll almost certainly be within a year or so of starting your courier business when you decide to register for VAT, it’s certainly worth going back and claiming all that you’re entitled to.

Posted under Courier Financial Issues, VAT

Once you’ve applied to be registered for VAT it can take anything from 2 weeks to 3 months (even longer in certain cases) for you to receive confirmation of your registration and your VAT registration number.

Unless you’ve taken the (sometimes sensible) option of starting your registration on a date in the future you could have a period of 3 months or longer when you’re liable to account for VAT on all your sales but you’re not legally able to charge VAT. This obviously leaves you with a problem.

You’re not legally able to show the VAT as a separate amount on your invoice unless you’ve received confirmation of your VAT registration.  HMRC’s solution is for you to issue a VAT-inclusive invoice to your customers. So instead of invoicing £100 you would invoice £117.50 ‘including VAT’. If you’ve got a close relationship with all of your customers and you can get them to agree to this in advance then this is without doubt the best option: please read on however.

Most established companies, particularly in the transport sector, will not pay VAT on an invoice unless it’s a genuine VAT invoice containing a VAT number and the VAT shown as a separate amount. You are not allowed (or able) to supply these details on your invoices until you receive confirmation of you VAT registration. If you use the HMRC approved method above (invoicing inclusive of VAT), without the prior agreement of your customer, you may well find that your customer delays payment of your entire invoice until they receive a proper VAT receipt.

The alternative method of dealing with this problem is to invoice for the normal amount, say £100 using the example above, with a clear notice on the invoice stating that you are awaiting VAT registration and a full VAT invoice showing the outstanding VAT will be issued as soon as your registration is confirmed. This avoids the delay that will almost inevitably be caused if you issue a VAT-inclusive invoice as recommended by HMRC.

Once your VAT registration is confirmed you send them an invoice for the full amount, with the VAT itemised, with a credit shown for the original amount (if that’s already been paid) and just the VATshowing as outstanding. If you’re ONLY invoicing for the outstanding VAT it can be seen as helpful (or at least ‘friendly’) to show the ‘payment due’ date as the last day of your own VAT quarter.

Remember that you can reclaim the VAT on many expenses incurred BEFORE your registration date. I’ll cover that in a future posting.

Posted under Courier Business, VAT

The Driver Certificate of Professional Competence (or Driver CPC) is a new scheme brought in under the requirements of an EU Directive 2003/59. It will eventually apply to all drivers of Large Goods Vehicles (LGV) and Passenger Carrying Vehicles (PCV).

The Driver CPC is in no way connected with the Operator’s CPC required by Transport Managers etc to become an O Licence holder.

This is guidance for the Driver CPC as it applies to GOODS VEHICLE DRIVERS ONLY. The rules for PCV drivers will be implemented on earlier dates.

The requirement to hold a valid Driver CPC will eventually apply to all drivers of goods vehicles over 3500 kg GVW – so all drivers driving vehicles that require C1, C1+E, C or C+E licences.

All new drivers passing their tests to driver vehicles over 3500 kg after 10th September 2009 will have to obtain an initial Driver CPC qualification in addition to passing the appropriate driving test. The Driver CPC will need to be renewed every 5 years by completing a 35 hour course.

Drivers who have already have C1, C1+E, C or C+E licences before 10th September 2009 will not have to obtain an initial Driver CPC qualification but will still have to undertake 35 hours of training to renew their periodic Driver CPC by September 2014 and every 5 years after that.

Drivers of vehicles driven under B+E licences (van and trailer combinations) do not require a Driver CPC irrespective of the Gross Train Weight

Posted under Legal Issues, Towing, Vans

I know that quite a few people seem to reach this page when they’re searching for freelance same day courier work etc. Please read this page if that’s what you were looking for.

Ah, so Earnings = Income – Fuel Cost? You’re providing the vans and the insurance yourself are you?

These “standard business expenses” which “should be part of ur business model” are paid for FROM YOUR GROSS TURNOVER.

There’s no way around: Profit = Turnover – Fuel – OTHER EXPENSES.

Your mindless assumption that standing costs will disappear just because they’re already included in someone’s business plan are laughable.

Without wishiing to get too personal, your obvious lack of mathematical and business skills demonstrate admirably why an owner-driver would be exceptionally foolish to allow you £7000 credit.

I’d agree to an extent that it’s easily possible to make ‘a wage’ running at those rates. I just don’t think I’d personally be happy putting all my eggs in one basket by relying on one small, recently formed business for all my work while at the same time supplying them with a line of credit that no bank would agree to without security.

To put it bluntly, it’s one thing working for TNT or DHL at those rates, it’s quite a different thing working for you, or working for us for that matter if we offered those payment terms.

Posted under Courier Basics, Courier Financial Issues

You’ll never get the 25p rebate in a van. There’d be no sensible way of calculating it without tachos and if it applies to us it would have to apply to every computer engineer, florist, pizza man, builder etc.

There’s a VERY slim chance that the truckers will get their rebate (which will be bad news for us) but I can’t see that there’s any chance whatsoever that it would be extended to van operators.

The government are even refusing ‘essential user rebates’ to the Police, the NHS, the Fire Service and local authorities. That will result in a budget deficit for these genuinely ‘essential users’ and huge council tax increases for us next year – more importantly though, if the NHS aren’t getting a rebate for shifting sick people to A&E are we likely to get one for shifting some worthless junk around the country?

Posted under Protests & Strikes, Vans

Fantasy Couriers

Is this a wind-up?

“The game is an online sim game, set in the courier industry. We’ve been planning and building now for a couple of months, and now we’re into the artwork and design phase, so we’re starting to see it growing fast. Fantasy Couriers is a simulation game set in the courier industry. This industry has been chosen as it it probably one of the most challengling markets in the world at present with ever increasing fuel prices. So, to make the game as challenging as the real world, the prices of fuel in the game are pegged to the prices of fuel in the real world. If the oil companies increase the pump price, or if Gordon Brown puts a penny or two on fuel tax, YOUR PROFITS in the game suffer, you may end up running jobs at a loss, it could make you bankrupt.”

Posted under Courier Business