Do I need to hire accountant on an ongoing basis for my simple case?

[code46]

Sole trader I can understand, but I'm at a loss to why the client / agency would prevent you using an umbrella, which would be your simplest option. If you don't understand why clients won't take on sole traders, do some research - start by searching the forum, it's been done to death in the past.

I'm sorry I haven't been very clear on this. This is not a strict restriction imposed by the client but consideration with several other personal factors taken into account (but not just tax consideration).

OK. Not sure that makes sense as a business decision, but it's your decision.

Work it out and then decide whether you need to register for VAT. Sounds like it isn't, but you could easily do it and make a little bit of money from FRS.


See above if this is your only engagement.

It might be clearer to say it other way. I do not consider the contractor work as my main source of income. My other income (mostly in tax free form e.g. ISA investment, gambling, and investment out side of the country as a non-domiciled who live in UK less than 5 years and won't emit that income inside UK) is sufficient to cover my daily spending in UK and outside. Maybe this explains several questions here.

Read up on the settlements legislation - what is your partner doing to justify the shareholding?


If you are employees, then you need to pay NMW. If you are officers of the company, you won't. Make sure you understand the legalities of being employees, and have the appropriate insurance in place.


If you are doing it yourself, make sure the system can cope with the new NI threshold rules and RTI. Make sure that your accountant can take the data from your system for doing the end of year accounts.

Thanks for all the good advise. Will read about settlements legislation. If both me and my partner invest in the initially registered capital of the company when it's established, would that still be a problem?

If she works as a part time secretary on the paperwork and bookkeeping etc. for the company, then her hourly rates can still up the NMW but the total remains low. Do you see there is any obvious caveat here? Thanks. Forgive me if my understanding is totally wrong as a newbie.

Why consult your accountant about IR35? Talk to an IR35 expert instead, or read and understand the multitude of IR35-related resources out there.

Ask an accountant. Find out what they will charge throughout the year, and then ask how much they charge to just prepare the end of year accounts. There are plenty around who will give you some idea of costs.

Personally, I'd be trying to find out why you can't use an umbrella and go that route.

Thanks for all the good advise. Will talk to some local accountant to see. As the contracting work is a side work, I just want it to be less hassle, but unfortunately Ltd does seem to be quite complicated.

PS. for my particular case, does service like Crunch fit? Only read its website so far, which seems to emphasis self-service, hassle-free, tailored for simple case only and low cost.

Thanks!

[code46]

No you do not need an accountant, I do not use one and do generally ok.

Like you I thought about hiring someone ad-hoc to help with end of year, but to be honest the quotes I got wasn't that much less than engaging someone each month to do "everything" for you, being the cheapskate I am I get by with advice on here and doing my own research which you would have to do anyway as your accountant will only advise you what you should do, its ultimately your company so your responsibility.

Hi Camnomis,

Thanks for the reply. I understand the difficulty and also heard it won't save much even if just using the year-end service. The people I've heard who DIY themselves have either gone along the process with an accountant in previous years or with an accounting background.

I'm just doing the research to justify different routes rather than saying I not going to hire a ongoing one. I guess even if I decide to hire an on-going accountant, there are different types of accounting services to choose from. It's good to know a bit more before talking to a particular one I believe, hence posting the thread.

Many thanks!

[northernladuk]

Surely being foreign and not knowing the UK tax situation an accountant is even more necessary?

You need to stop using your partner as a tax mule. You shouldn't be giving her shares unless you are married and you can't pay her more than she is worth. You can employ the services of an accountant for £1500 a year so how do you think paying someone around 8k a year for a bit of book keeping is going to work? HMRC will see straight through that.

Why not pay for a proper accountant for a year until you get the hang of it and then switch to a low cost one from thereon in. A good accountant will save you more than it costs. Doing it wrong could cost you a hell of a lot more. £1500 is hardly a lot.

[Mojito]

A proactive accountant that understands contracting is well worth the money. I'll not make any specific recommendations for fear of upsetting NLUK, but I will say that Freeagent makes the whole rigmarole a lot more bearable.

If you try to save a few quid by doing DIY when you don't have (and maintain) a firm grasp on tax law or by going cheap on your accountant, it'll likely end up costing you more in the long run. Penny wise / pound foolish and all that....

[northernladuk]

A proactive accountant that understands contracting is well worth the money. I'll not make any specific recommendations for fear of upsetting NLUK, but I will say that Freeagent makes the whole rigmarole a lot more bearable.

If you try to save a few quid by doing DIY when you don't have (and maintain) a firm grasp on tax law or by going cheap on your accountant, it'll likely end up costing you more in the long run. Penny wise / pound foolish and all that....

I need to have a go at Freeagent. I hear so much good stuff and I am sure it will have advantages over the SJD spreadsheet but I can't see it offering so much more to be worth the effort. I am sure once I have made the move I will wonder why I didn't before but hey ho...

Freeagent is just a tool though, it isn't going to give him the advise he needs.

[code46]

Surely being foreign and not knowing the UK tax situation an accountant is even more necessary?

You need to stop using your partner as a tax mule. You shouldn't be giving her shares unless you are married and you can't pay her more than she is worth. You can employ the services of an accountant for £1500 a year so how do you think paying someone around 8k a year for a bit of book keeping is going to work? HMRC will see straight through that.

Why not pay for a proper accountant for a year until you get the hang of it and then switch to a low cost one from thereon in. A good accountant will save you more than it costs. Doing it wrong could cost you a hell of a lot more. £1500 is hardly a lot.

Hi northernladkuk,

Thanks for your input, points well taken. As a foreigner, dealing with accountant especially remote ones is itself some kind of hassle and can cause misunderstandings occasionally. So I might go with some local ones to begin with to just have a face to face interaction and move to more self-service type later.

I think your point of hiring bookkeeping for £8000 is too expensive makes sense. I certainly have no intention to the break law just for tax purpose. I'll consult with accountant on that, but I guess I can pay her at least certain amount for her service (say £1000) if that makes sense. It's not just about money, but also about getting her some employment record and other purposes.

I still don't get why I can't co-establish the company with my partner as initiator (if that's what you mean). I'm under the impression that you can establish a business with your family members or relatives as far as they invest in the initial funding? Could you point me to some link or key words to search just help me to get a basic idea about the regulation? Thanks. My partner used to hold the dependent VISA as my unmarried partner (which is basically recognized by UKBA as a cohabitant couple only without civil marriage). Of course, I'll need to talk to an accountant on the details but just want to have some background knowledge first.

Many thanks!

[JonNorris@Crunch]

PS. for my particular case, does service like Crunch fit? Only read its website so far, which seems to emphasis self-service, hassle-free, tailored for simple case only and low cost.

Should work fine as long as your company income is kept separate from your investment / gambling income.

Would also second (third? fourth?) the previous advice about hiring someone who knows what they're doing - sounds like your situation is fairly complicated compared to the average Contractor.

I need to have a go at Freeagent. I hear so much good stuff and I am sure it will have advantages over the SJD spreadsheet but I can't see it offering so much more to be worth the effort.

I'll probably get a slapped wrist for this, but it is a lovely bit of kit.

[TheFaQQer]

Freeagent is just a tool though, it isn't going to give him the advise he needs.

Or the advice he needs.

[northernladuk]

Hi northernladkuk,

Thanks for your input, points well taken. As a foreigner, dealing with accountant especially remote ones is itself some kind of hassle and can cause misunderstandings occasionally. So I might go with some local ones to begin with to just have a face to face interaction and move to more self-service type later.

Personally I would say stay away from local ones and go for ones that understand contracting. They can give much better tailored advice based on what we do.

I think your point of hiring bookkeeping for £8000 is too expensive makes sense. I certainly have no intention to the break law just for tax purpose. I'll consult with accountant on that, but I guess I can pay her at least certain amount for her service (say £1000) if that makes sense. It's not just about money, but also about getting her some employment record and other purposes.

Your call. Just make sure she does the same amount of work for the same pay as a stranger else it's going to look suspect.

I still don't get why I can't co-establish the company with my partner as initiator (if that's what you mean). I'm under the impression that you can establish a business with your family members or relatives as far as they invest in the initial funding? Could you point me to some link or key words to search just help me to get a basic idea about the regulation? Thanks. My partner used to hold the dependent VISA as my unmarried partner (which is basically recognized by UKBA as a cohabitant couple only without civil marriage). Of course, I'll need to talk to an accountant on the details but just want to have some background knowledge first.

Many thanks!

Well you kinda answered your own question mentioning family members or relatives. Your partner is neither. You are just using her to get money out of the company and gain a tax advantage. There are 100's of posts on here about. Try a search for settlements, wife shares, gifting shares. It's a moot point with a wife let alone a partner. Have a look at the S660 links on the right hand side but it's pretty complicated. Bottom line though is you can't do it with your partner.

[northernladuk]

Or the advice he needs.

Ok, was nice to see you, now fook off again

I should have put [sic] as the OP has made the same error a number times. I was just replicating that error to make a point <cough>