Reply to: OK to leave company dormant and then hiring accountant once I have got a job?

[Eirikur]

Well I just thought that it might take longer (like longer than a week) to start the company up / set bank account and so wanted to do this myself and then hire an accountant when I get the job. If I did this and ended up in the (hopefully unlikely) circumstance that I am unable to find a job in a year, then I will have to make the filings to HMRC/Company house myself.

So would the accountant typically set up the bank account as well? Thanks

Took me less then few hours to find accountant who set up and registered the company, for me all on the same day as I received my offer for a contract. VAT registration took two weeks to come through but that was no problem as the agency had a 4 week payment term anyway and the bankaccount request was done by the accountant as well and all done and dusted within a week or so.

[Yonmons]

I'd wait until you've got a contract sorted.

Companies can be incorporated in ~1 working day. Yes getting a bank account/VAT registration in place do take a little longer, but typically you only need those in place for when you come to send your first invoice, rather than before you can start work.

Risk if you do it all now is that:
1) you never get a contract, so end up wasting effort and having to close the company down in a while without it doing anything.
2) you do get a contract in (say) 9 months time. At that point you appoint an accountant, and they insist on an up front fee because your year end is only a few months away.

I am doing exactly this, the job I was going to use the LTD Co for fell through so rule 1 applies,
being with an umbrella company on my current contract I could see rule 2 applying so I am 6 weeks into the close down procedure with companies house.
Setting up a Ltd co really is no big deal, and you can whistle through the procedure including opening a bank account in a week.
I didnt want to take a contract on, then (even though I hadnt previously used it) end up having to pay an accountant for year end books. He would make more money on the deal than me.

[Andrew@Wisteria]

Ah it seems that you can sign up for an email alert at https://www.gov.uk/prepare-an-annual...ompanies-house

That's just for the annual return by the way.

[yri768]

Your accountant will advise.

Ah it seems that you can sign up for an email alert at https://www.gov.uk/prepare-an-annual...ompanies-house

[northernladuk]

Hi thanks. How do I find out the exact dates I need to do these things by?

Your accountant will advise.

[yri768]

1. Annual return - which is a noddy thing on the Companies House website
2. Annual accounts with Co House
3. CT return with HMRC.

Though you can do 2 & 3 together via their PDF form.

And that is all, unless you register for VAT and PAYE.

If you're going to do this you might want to sort out your Government Gateway ID sooner rather than later.

Hi thanks. How do I find out the exact dates I need to do these things by?

[Maslins]

I'd wait until you've got a contract sorted.

Companies can be incorporated in ~1 working day. Yes getting a bank account/VAT registration in place do take a little longer, but typically you only need those in place for when you come to send your first invoice, rather than before you can start work.

Risk if you do it all now is that:
1) you never get a contract, so end up wasting effort and having to close the company down in a while without it doing anything.
2) you do get a contract in (say) 9 months time. At that point you appoint an accountant, and they insist on an up front fee because your year end is only a few months away.

[yri768]

What are the reasons for you doing this?

Well I just thought that it might take longer (like longer than a week) to start the company up / set bank account and so wanted to do this myself and then hire an accountant when I get the job. If I did this and ended up in the (hopefully unlikely) circumstance that I am unable to find a job in a year, then I will have to make the filings to HMRC/Company house myself.

So would the accountant typically set up the bank account as well? Thanks

[VectraMan]

Hi, sorry i meant just to leave the company there and not use it. So in the absence of an accountant, would my main responsibilities be to file :

a)Annual Return
b)Corporate Tax return

even though the company has not been used? Thanks

1. Annual return - which is a noddy thing on the Companies House website
2. Annual accounts with Co House
3. CT return with HMRC.

Though you can do 2 & 3 together via their PDF form.

And that is all, unless you register for VAT and PAYE.

If you're going to do this you might want to sort out your Government Gateway ID sooner rather than later.

[northernladuk]

Hi, sorry i meant just to leave the company there and not use it. So in the absence of an accountant, would my main responsibilities be to file :

a)Annual Return
b)Corporate Tax return

even though the company has not been used? Thanks

What are the reasons for you doing this? With the limited information you are giving you seem to be making work for yourself needlessly. When the need arises an accountant (or yourself) can spin up a company in a couple of days. Bank account and VAT (FRS) might take a bit longer but can easily be done without creating any hardship.

Is there some alternative agenda we are not aware of in place?

[yri768]

I assume by "dormant" you mean don't use it rather than actually make it dormant (which would be pointless).

Hi, sorry i meant just to leave the company there and not use it. So in the absence of an accountant, would my main responsibilities be to file :

a)Annual Return
b)Corporate Tax return

even though the company has not been used? Thanks

[ASB]

It is difficult to see how you could incorporate a dormant company since the incorporation will involve transaction, by definition it is not then dormant. That means for that accounting period non dormant accounts will be required.

But, you can wait at long as you want before appointing an accountant and actively trading.

[VectraMan]

I assume by "dormant" you mean don't use it rather than actually make it dormant (which would be pointless).

Nothing wrong with doing that. However accountants do most their work at year end and usually charge monthly to spread the cost, so you might find they want to charge you more than their normal monthly fee to jump in mid way through the year - i.e. you won't save any money.

If you're worried about how you pay for an accountant before the company has any money, then that's no problem. You can just loan the company some of your money and pay it back later.

FWIW at the time I wished I'd let the accountant create the company for me as it would have made a couple of things easier.

[unixman]

I am not sure about the legalities of starting a company and immediately leaving it dormant, but it would save some hassle. I started a Ltd at the same time as starting a new contract. It was a pain/steep learning curve doing both at once, also engaging an accountant for the first time, opening the company bank acct etc, all while living in a hotel. Not helped by my accountant at the time being completely unhelpful.

[SlipTheJab]

Hi my plan (contracting in UK) was to do the following :

1)Register at https://www.gov.uk/register-a-company-online

2)Set up bank account for company

3)Leave the company dormant and then hire an accountant
once I had found a job.

Is this OK? or is there something important I am missing?

Thanks

Find a role first once you manage to get one then sort out an accountant and they will do handle the rest.