Hello, Im new and have questions about HMRC

[reno]

Thanks for your answers!


FreeAgent? It’s a software to “do it yourself” right. (so why some tells me it vital for me to have an accountant, and other tells me it’s ok to do myself… I’m confuse)

Well, the truth is, my contract is over now, it may take a while until I get a new one so the company will “standby” for at least 4 or 5 months.

I just want to pay my taxes and be free, why it has to be such a big thing in 21 century
A friend of mine (barber) was 2 years late about taxes; he was just fine by having an appointment to “catch up” and never had to pay any penalty. (since it was his initiative)

I am not even really late yet right? The accounting period is still on.
I don’t see where I dig my own grave here? What’s the matter, I kept any invoices and bill records, everything is OK and I just need to provide these information online asap right? Where am I wrong?


Why it would be so hard to calculate the taxes my company needs to pay and how much I need to pay, I just need to fill the form HRMC will send me and that’s it?
I asked for the Limited Company “form” yesterday to get the password I need to fill the online thing.

To be really honest I am very curious about doing it myself. I want to know “how it works”.
But yes, maybe you think it would be good for me to have some real advice as well with an accountant, not to do this job but at least to speak about it.
Well, to say the truth I thought I would be able to speak to an accountant here, just to get the basic knowledge. After all, it’s the same to get this knowledge through internet.


EDIT: no I don't pay wages, I'm alone (selfemployed is the right word if I'm not wrong) and my previous description is everything I did, but sorry I don't know what is FRS, I think it doesn't concern me.
Thanks again.

[Clare@InTouch]

The problem with getting advice here is that it's not going to cover everything you need to know, as it seems there's a massive amount you don't know. VAT, PAYE and CT all have their own rules and forms. It's not as simple as filling in the form HMRC send you - how will you know what you're allowed to put in each box? Or even which boxes to fill in. This is a CT return - http://www.hmrc.gov.uk/ctsa/ct600-short-2008.pdf and you'll also need to prepare statutory accounts in a certain format for filing at Companies House.

Freeagent is bookkeeping software that may help you understand that side of things. Dealing with HMRC and making the necessary filings there is a different thing.

Your friend who was late - was he self employed or trading through a company? The rules are different for each, as are the time limits for filing.

If you have a limited company you are not self employed, you're an employee. As such you can pay wages and dividends. Getting the right mix between the two can save you a lot of tax.

FRS is Flat Rate VAT, and the scheme enables you to profit from each invoice you issue in certain circumstances.

At the very least I would suggest you prepare everything yourself as you think appropriate, and then run it past an accountant. It may be too late by that stage to benefit from their advice, but they can at least confirm your filings with HMRC and Companies House are correct.

[reno]

Yes it's too late for VAT application, that was not an obligation for my case (way less than the maximum income needed) so I didn't applied at this time.

If you have a limited company you are not self employed, you're an employee.

Ok, so legally I am both the director of the company, and the only employee of this company.
So, after paying the company taxes, what kind of thing I have to do to pay my "personal taxes" (with the NI and everything), what is the name of the form I should get from the HMRC website?
So far I thought it was the self-employment form in my case but I was wrong.

Yes I admit I still need to know a big amount of things, I keep reading about it for a long time and try to hold on. English doesn't help of course... But thank you about the advices; you know recently I think that I already learnt a huge amount of these thing I never understood before.

And even if I feel really bad when it comes to these things, I really want to know how it works.
(at least it will be useful in order to understand what an accountant is telling me)

[cojak]

Thanks for your answers!


FreeAgent? It’s a software to “do it yourself” right. (so why some tells me it vital for me to have an accountant, and other tells me it’s ok to do myself… I’m confuse)

I told you about Freeagent because I gave up on you. You say you don't want to use an accountant because you don't need one. I know that you do need one but at the very least you need a 'do it yourself' bookkeeping that plugs into HMRC (like VAT) and makes it easier to pay your taxes.

So I gave you the advice that this the minimum you should do.

I don't know what else you want to us to tell you, other than be a free accountancy service for you.

Like that's going to happen...

[Wanderer]

Yes it's too late for VAT application, that was not an obligation for my case (way less than the maximum income needed) so I didn't applied at this time.

If you got an accountant when you formed your company then they would have explained why you should register for VAT and join the FRS because you can get money for nothing by doing it.

Your friend who is a barber will be self employed so their tax affairs are much simpler. It doesn't matter so much that they didn't get professional advice because there is less scope for them to avoid paying tax anyway and much less bureaucracy than with a Limited Company so they are less likely to be fined for not doing something.

As a limited company there is a lot of paperwork to do and forms to file. If you don't do them at the right time then you will get fined. As a limited company there are also many things you can do to avoid tax, for example by paying the correct amount of salary and dividends but you really do need to get professional advice because everyone's circumstances are different. HMRC will NOT tell you about all the ways you can minimise the tax you have to pay - that's not their job. They will just compute a tax bill the way they like it and hand it to you to pay. An accountant will use legal and acceptable methods to structure your earnings in the way that suits you best, not the tax man.

The majority of people here who have LTD companies use an accountant and this includes people who have been in business for many years.

"a good accountant will save you far more than they cost you". Keep telling yourself that because it's true.

[TheFaQQer]

Since the original post has been butchered beyond recognition, to the extent that there is no detail any more about what the problem is, how can you expect to get any meaningful advice here?

[TheFaQQer]

I just want to make ready to pay this, even if that means spending a day to calculate everything I have to pay, it will be worthy because I can’t afford an accountant unfortunately.

EDIT: no I don't pay wages, I'm alone (selfemployed is the right word if I'm not wrong) and my previous description is everything I did, but sorry I don't know what is FRS, I think it doesn't concern me.
Thanks again.

I'm confuse (sic) - you haven't paid any wages. You've not paid any taxes.

So, the money invoiced must be in the company bank account.

Given that, why can't you afford to pay an accountant?

[reno]

"a good accountant will save you far more than they cost you". Keep telling yourself that because it's true.

I agree to that..

Maybe I was just too naive to think my case was too small to have any significant impact.
For example I just tried the simulation in one link provided here >> Online Accounting | Accountants | Accounting services - Crunch

And the result is: "Crikey, aren't you tax efficient?

It looks like a limited company with Crunch probably won't save you any money - it could still save you time though!"


Because the total money the company earns so far is about £30000 and I gave £15000 (so far) to myself, just using bank transfer from my business account to my personnal account.
(does it count “automatically” as a wage)


My real concern here is... Am I really late and a total hopless mess?
The company was setup in sept2012 and it's first income was end november... That's it. I did nothing else than giving £2000 to myself every 2 months to pay the rent and bills and keep working.

I am not looking for a free accountant service, some advices are really nice. Thanks again. I was just concern about what to do in this case, maybe I was trying to be reassured about being late to tell HMRC I was active.
Is it really bad, can I catch up and make everything right? (both for the company taxes and my taxes) Like in "one shot", to catch everything and make them right...

[reno]

I'm confuse (sic) - you haven't paid any wages. You've not paid any taxes.

So, the money invoiced must be in the company bank account.

Given that, why can't you afford to pay an accountant?

There is still half the total money in the account indeed, but I will have to live on it for a long while maybe (and I am affraid about taxes taking a huge part of it, as it's my first time I don't know what to expect) so I was affraid to take an accountant as they may be very expensive every month. (even if I don't need an accountant after the taxes are paid?)

[cojak]

Ok.

Right.

Now I DO appreciate that you are just trying to do the right thing and pay your taxes. You have just got yourself into a mess and want to know the best way of getting out of the it. And you want to get onto the path of doing the right thing and pay your taxes and enter your company's annual returns with Companies House (because that may be what got you into this mess in the beginning.

I get it.

So - 2 things to do.

1) I never advise this, but in this instance it's for the best - contact HMRC, call them (always speak to a person about this kind of thing), tell THEM what's happened and ask them what you should do. They will tell you. Income Tax enquiries for individuals, pensioners and employees

2) Go to the Companies House website and read up on starting a company and ALL of the guidance notes. They will tell you what you need to do regarding keeping your company legal. If you feel it's needed give them a call too. Information & Guidance - Starting a company

After that you can decide if you can do this contracting lark without help by using Freeagent or use an accountant.