starting my 1st contract

[SueEllen]

It can also be very messy. My advice is to have at least 6 months worth of savings to pay the bills before attempting contracting. Then trying to maintain that war chest for periods of being in-between contracts.
Example scenario might be

- Start May 1st
- Work May
- Invoice #1, 30 day terms, due July 1st
- Work June
- July 1st comes around, agency fails to pay invoice for May, gives a multitude of excuses, say's it will be paid soon.
- Work July
- 3 months in, agency goes bust, no payment received
- Client says good bye to you
- August contract hunting.
- Manage to get a new contract starting Sept 1st
- Start Sept 1st in the office, client says, we're really sorry but the budget hasn't been approved yet, can you go home, and we'll tell the agency when the budget has been approved....

While that's happening you owe the VAT on the invoices you raised, even if you haven't been paid yet. Hence it can be quite messy and stressful at times. Doesn't end once you're in a contract either, you need to have the mindset of a Samurai. Be prepared to be terminated at any moment, then move on to the next gig without asking any questions.

You can do cash accounting for VAT.

It is up to you to understand why that means not your accountant.

Oh yeah did someone make it clear you are solely responsible for your accounts not your accountant?

So if you sign something off/agree to it and they have done it wrong, or they are late or even worse disappear HMRC comes after you.

[londonrulz]

Have you actually get a Status Determination via the agency from the end client - because if you haven't (heck even if you have but the client is unscrupulous) the end client has 90 days (based on payment terms elsewhere in the payment chain) to change their mind.

Have you checked the contract to see if there is no payment claw back clause were the status to be changed by the end client or (years later) by HMRC?

Thanks for pointing that out. I couldn't find any claw back clause in the contract (did the keyword search as well).

[gixxer2021]

Do a search for MSC legislation...

I’d second this, imho possibly as important if not more important than IR35 these days. Getting your accountant to set up your company probably isn’t a great regarding this. Probably the longest thing I found to set up was the business bank, so I’d recommend getting that set up asap. Good luck!

[londonrulz]

I’d second this, imho possibly as important if not more important than IR35 these days. Getting your accountant to set up your company probably isn’t a great regarding this. Probably the longest thing I found to set up was the business bank, so I’d recommend getting that set up asap. Good luck!

I had already asked him to do it before I read that

What business banks are popular and would recommend?

[gixxer2021]

I had already asked him to do it before I read that

What business banks are popular and would recommend?

I wouldn’t worry too much about it as long as you read up on the MSC legislation here and take necessary precautions going forward. I’ve heard a lot of good things about Starling but don’t bank with them myself (I do use their apis though within my work and are very impressive with their response to questions etc). I’m with Santander and have no complaints.

[Lance]

I had already asked him to do it before I read that

What business banks are popular and would recommend?

banks are all much of a muchness.
Just don't pay for it.

Cater Allen - no app, and a bit unfriendly. Links with FreeAgent and you can do quite large cash transfers (£80k is the most I;ve done). telephone support quite responsive.
Mettle - Good app. No phone support. Limited to £10k in one go. Instant links to FreeAgent, and provides FreeAgent for free
Startling - near as damn it the same as Mettle, except it doesn't provide FA for free

[DrewG]

banks are all much of a muchness.
Just don't pay for it.

I wouldn't call Coutts the same as all the others. If you have revenue >1m or you have >1m portfolio that you want to put under their management, they're by far the best.

[northernladuk]

banks are all much of a muchness.
Just don't pay for it.

Cater Allen - no app, and a bit unfriendly. Links with FreeAgent and you can do quite large cash transfers (£80k is the most I;ve done). telephone support quite responsive.
Mettle - Good app. No phone support. Limited to £10k in one go. Instant links to FreeAgent, and provides FreeAgent for free
Startling - near as damn it the same as Mettle, except it doesn't provide FA for free

I pay £7.50 a month (claimed so less in your pocket) for Santander which doesn't have any of the downsides mentioned above and have been very happy with them for a long time now. Small potatoes for something I'm happy with. Sometimes free isn't always best.

[Lance]

I wouldn't call Coutts the same as all the others. If you have revenue >1m or you have >1m portfolio that you want to put under their management, they're by far the best.

thanks for that incredibly helpful insight. I'm sure OP is very pleased to have your assistance in this matter.

NB. Coutts have the same FSCS protection as any other bank.

[Lance]

I pay £7.50 a month (claimed so less in your pocket) for Santander which doesn't have any of the downsides mentioned above and have been very happy with them for a long time now. Small potatoes for something I'm happy with. Sometimes free isn't always best.

granted. But I'll keep the £7.50 as I've lived in Yorkshire too long.