Does anyone do their own 'accounting' and admin?

[philip@wellwoodhoyle]

As for IR35, I'm sorry but if you are using any of the 'former' MSC companies, then you run the risk of being caught under the new April legislation, hence the reason I decided to go it alone in April to remove this risk completely. You have to be seen to be in full control of your own affairs, dictating your own salary, company decisions, etc. not sitting at a desk earning money and having a company process your affairs for you. For me this was an easy choice, simply remove the risk and do it yourself.

The MSC legislation is completely different to IR35. Yes, by setting up and running your own limited company, you will escape being caught by the MSC legislation, but you still may be caught by IR35 which depends on your contract and working relationships, not by how your business is set up.

[philip@wellwoodhoyle]

I am quite familiar with 'double entry' accounting but do you guys know of a sample spreadsheet I can play around with? If I can do the general stuff myself like set the LTD up and do the day-to-day recording of expenses (etc.) , I'd rather do that and save a few quid.

Thanks.

I'd go for www.vtsoftware.co.uk who do a cash book program free of charge if all you want is book-keeping and VAT Returns. They also have an enhanced version which also does sales and purchase ledgers at a very fair nominal price. Both of these are based on a double-entry ledger system so you have all the usual checks and balances.

I'd avoid spreadsheets if I were you as they are notoriously unreliable unless you put a lot of checks and balances in yourself when you create them - too easy to accidentally "format" a cell as a label instead of a number, so the number doesn't get included in the totals or formulae, or to add a new column or row and not remember to edit the formulae, again leaving it outside the totals.

[RockyBalboa]

Well I have managed to surf around and found SJD's website and template example.. but I have one burning question:

Maybe I am getting this totally wrong but, if I am required to fill in such a template for services such as SJD's, what exactly are such accountancy firms doing apart from 'totalling it up' at the end of key periods?

[Sockpuppet]

Making sure that you didn't feck up and stopping you get large fines / convictions for fraud.

[Vito]

I pay an accountant to do everything for me and wouldn't have it any other way...he has already saved me several thousand by knowing about a regulation that is pretty well hidden...

I could do it myself I suspect but the reality is that I don't really enjoy it and there is a reason that accountants spend so much time getting qualified and also spend so much time keeping up with the latest laws are regulations. My mum is a book-keeper and has been for many years, but even she recommended that I use an accountant on a monthly basis and pay the c.£70 that it costs...

I can understand people wanting to do it for themselves, but personally I think a good accountant will save you far more than the amount you spend on them.

Also worth noting for anyone reading the earlier post about flat rate VAT, that its not quite the earlier post reads.

I read the earlier post to suggest the following:

£10k invoice x 17.5% VAT = £1,750 VAT paid to your company by the client

£10k invoice x 12% VAT = £1,200 VAT paid to the VAT man

Profit thus being £550

In fact it is as follows:

£10k invoice + 17.5% VAT = £11,750 paid by client

£11,750 x 12% = £1,410 owed to the vat man

Profit thus being £340

So, still a healthy profit and for many contractors I'm sure the best way to go, but I know some people (including me at first) get this calc wrong.

[malvolio]

And of course profits are taxed at 20%, so net gain is actually £272...

[chris79]

The MSC legislation is completely different to IR35. Yes, by setting up and running your own limited company, you will escape being caught by the MSC legislation, but you still may be caught by IR35 which depends on your contract and working relationships, not by how your business is set up.

Sorry but if you are to differentiate that you are a business in your own right to the tax man, then in my own view it's best to be as far away from an MSC / former MSC as possible at this moment in time? I understand what you are saying that IR35 is the working arrangement, perhaps I was wrong to use the term IR35 in there.

[xoggoth]

This keeps coming up and I will add what I always add. Use an accountant if you wish but it always pays to keep abreast of the tax laws and to check your own accounts thoroughly. Too many people think I've got an accountant so I'm ok but people with accountants get into major problems. Heard of one recently who was totally clobbered. Even a good accountant cannot always spot the errors in the records you give him.

[Bluebird]

I got quoted £600 from an accountant for doing just the end of year stuff, SJD charge £85 pcm which = £1020.

So it's an extra £400 or £33 a month for providing info on VAT, PAYE and general queries on anything stupid I think of.

Thats less that I take home per hour - so I think it's a pretty good deal.

[OrangeHopper]

I have done my own (double entry) accounts since I started many moons ago but I get an accountant to do end-of-year stuff in case I've missed something. For example, last year I didn't realise that the flat rate VAT saving needed to be distributed as part of the deemed payment if the income was caught by IR35.

Xog is also right in that the accountant doesn't always get it right. There have been a number of occasions where I've pointed out where they have done something wrong. I can only do this because I have done my own accounts.

Also note that getting an accountant to do the end-of-year stuff may not be significantly cheaper than using them to do all the work.