In the ever-evolving business landscape of New South Wales, adapting to changes in your business structure or activities is crucial. Whether you’re expanding, pivoting, or restructuring, one critical step is to update your industry classification with iCare (Insurance and Care NSW). Failure to do so can lead to substantial overpayment on your workers’ compensation premiums.
Why Industry Classification Matters
Your industry classification plays a vital role in determining your workers’ compensation premium rates. Each classification is tied to specific risks associated with your business activities, and if these change without a corresponding update, you could end up paying far more than necessary.
Consider a recent case involving a winery that transitioned into a liquor wholesaler after selling its vineyard. The winery neglected to inform iCare about this significant change, resulting in a 30% overpayment on their premium. This example illustrates the financial repercussions of failing to promptly update your classification.
The Risks of Delayed Notification
It’s important to remember that you cannot backdate changes to your industry classification. If you wait too long to notify iCare after altering your business activities, you risk being locked into an inflated premium for the entire policy period. This oversight can lead to avoidable financial strain on your business.
Steps to Take When Your Business Activities Change
- Stay Vigilant: Keep a close watch on any changes within your business, whether it’s a shift in services, a change in ownership, or a pivot in focus.
- Consult Your Accountant: As soon as you identify any changes, consult with your accountant. They can guide you through the process of updating your industry classification and help assess the financial implications.
- Document Changes: Maintain thorough records of all changes and communications related to your industry classification. This will be invaluable for future audits and compliance checks.
- Seek iCare Advice: If you’re unsure about how a change impacts your classification or premium, don’t hesitate to seek advice from iCare. They specialise in navigating these complexities and can ensure you make informed decisions.
- Regular Reviews: Periodically review your industry classification and premium payments, especially after significant business changes. This will help you stay proactive in managing costs.
Conclusion
For businesses in New South Wales, keeping your industry classification up to date is essential for effective financial management. Don’t let a failure to communicate with iCare lead to unnecessary expenses. By consulting with your accountant and being proactive about changes, you can safeguard your business’s financial health and position yourself for continued success.
If your business has recently undergone changes, reach out to us today at clients@vcpg.com.au or (02) 7911 3265 to ensure your industry classification is current. Taking this simple step can make a significant difference to your bottom line!