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

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

    ... or can I just hire someone ad-hoc for the year-end work each year?

    I'm pretty new to all these (contracting, accounting and tax). I've read some articles here and there on the benefits and necessity of hiring an accountant on an ongoing basis. But I'm not sure to which extend these would benefit me on my simplest case. Here it is:

    I need to register a Ltd to do some IT contracting work for a company. For some reason, I must register a Ltd instead of being a sole trader or using umbrella company. Also, I might do just a few months this year and another few months next year (which was proposed by the company), but that's probably it. I consider it a temporary thing, and I'm not going to make contracting as a permanent or full time job in the long run.

    The only turnover of the Ltd will come from the the invoice I issue to the company , which is based on my daily rates. I'll issue the invoice monthly (or even quarterly if it makes things simpler, so by the end of year I guess there will be only 2-3 invoices in total?)

    I'll probably use the flat rate VAT scheme just to keep it simple, or maybe not do VAT registration at all if I eventually work for less months per year and keep the turnover below the threshold.

    I'm not expecting to expense expenditures, not frequently at least. I might expense a few relatively bigger ones only when they are 100% unambiguous as business spending, but I'd expect such cases to be very rare.

    Two share holders, me and my partner (unmarried). Two employees, me (director) and my partner (secretary or director, not sure which one is better).

    Will pay ourselves salaries only to maximize the NI/income allowance threshold. Might pay dividends too, but won't exceed the 20/40% line.

    I intend to use Kashflow/FreeAgent/Xero to do bookkeeping everything myself. Some people told me for my simple case even spreadsheet is fine, but I guess these online systems could make it easier for the year-end accountant.

    I might need some IR35 consultation but I can probably do it separately or buy insurance if needed.

    I'll still need to hire an accountant to prepare the year end stuff, which I'm going to.

    I just want to know, for simple cases/demands like this, is there any reason to hire an accountant on an ongoing basis paying the same 100+ fixed monthly rates as other complicated business cases? If so, what does the money buy me for? If not, what's the best solution for my case? should I just hire someone around the year end to do the work? How much does it normally cost for this type of service? and what's the best way to find a good one for such case?

    All inputs are welcome, thanks in advance!

    #2
    The simple answer is "Yes".

    Your writing style is in the same vein as the Sockie who pops up too regularly to be taken seriously. 🔔🔔🔔
    I was an IPSE Consultative Council Member, until the BoD abolished it. I am not an IPSE Member, since they have no longer have any relevance to me, as an IT Contractor. Read my lips...I recommend QDOS for ALL your Insurance requirements (Contact me for a referral code).

    Comment


      #3
      Originally posted by code46 View Post
      ... or can I just hire someone ad-hoc for the year-end work each year?
      Either - whatever works for you and your business. If you are operating PAYE then you will need to do that yourself if you don't have an accountant doing it for you.

      Originally posted by code46 View Post
      I need to register a Ltd to do some IT contracting work for a company. For some reason, I must register a Ltd instead of being a sole trader or using umbrella company. Also, I might do just a few months this year and another few months next year (which was proposed by the company), but that's probably it. I consider it a temporary thing, and I'm not going to make contracting as a permanent or full time job in the long run.
      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.

      If this is going to be your only engagement, make sure you understand the implications of that on expenses.

      Originally posted by code46 View Post
      The only turnover of the Ltd will come from the the invoice I issue to the company , which is based on my daily rates. I'll issue the invoice monthly (or even quarterly if it makes things simpler, so by the end of year I guess there will be only 2-3 invoices in total?)
      OK. Not sure that makes sense as a business decision, but it's your decision.

      Originally posted by code46 View Post
      I'll probably use the flat rate VAT scheme just to keep it simple, or maybe not do VAT registration at all if I eventually work for less months per year and keep the turnover below the threshold.
      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.

      Originally posted by code46 View Post
      I'm not expecting to expense expenditures, not frequently at least. I might expense a few relatively bigger ones only when they are 100% unambiguous as business spending, but I'd expect such cases to be very rare.
      See above if this is your only engagement.

      Originally posted by code46 View Post
      Two share holders, me and my partner (unmarried).
      Read up on the settlements legislation - what is your partner doing to justify the shareholding?

      Originally posted by code46 View Post
      Two employees, me (director) and my partner (secretary or director, not sure which one is better).

      Will pay ourselves salaries only to maximize the NI/income allowance threshold.
      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.

      Originally posted by code46 View Post
      Might pay dividends too, but won't exceed the 20/40% line.

      I intend to use Kashflow/FreeAgent/Xero to do bookkeeping everything myself. Some people told me for my simple case even spreadsheet is fine, but I guess these online systems could make it easier for the year-end accountant.
      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.

      Originally posted by code46 View Post
      I might need some IR35 consultation but I can probably do it separately or buy insurance if needed.
      Why consult your accountant about IR35? Talk to an IR35 expert instead, or read and understand the multitude of IR35-related resources out there.

      Originally posted by code46 View Post
      I just want to know, for simple cases/demands like this, is there any reason to hire an accountant on an ongoing basis paying the same 100+ fixed monthly rates as other complicated business cases? If so, what does the money buy me for? If not, what's the best solution for my case? should I just hire someone around the year end to do the work? How much does it normally cost for this type of service? and what's the best way to find a good one for such case?
      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.
      Originally posted by MaryPoppins
      I hadn't really understood this 'pwned' expression until I read DirtyDog's post.

      Comment


        #4
        Originally posted by code46 View Post
        Two share holders, me and my partner (unmarried). Two employees, me (director) and my partner (secretary or director, not sure which one is better).
        This alone answers your question. This is going to cost you a shed load more than an accountant when you get found out. You're already in the tulip through lack of good advice. Rectify it quick.

        Without an accountant how are you going to keep on top of changing legislation and where will you go for professional advice when you need it yadda yadda
        'CUK forum personality of 2011 - Winner - Yes really!!!!

        Comment


          #5
          Originally posted by northernladuk View Post
          Without an accountant how are you going to keep on top of changing legislation and where will you go for professional advice when you need it yadda yadda
          The same way that we all do - linky.
          Best Forum Advisor 2014
          Work in the public sector? You can read my FAQ here
          Click here to get 15% off your first year's IPSE membership

          Comment


            #6
            Originally posted by TheFaQQer View Post
            The same way that we all do - linky.
            'CUK forum personality of 2011 - Winner - Yes really!!!!

            Comment


              #7
              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.
              Camnomis : Service Transition Consultants

              Comment


                #8
                Originally posted by Camnomis View Post
                No you do not need an accountant, I do not use one and do generally ok.
                This one paragraph from the original post almost proves without doubt why the OP needs to use an accountant:

                Originally posted by code46 View Post
                Two share holders, me and my partner (unmarried). Two employees, me (director) and my partner (secretary or director, not sure which one is better).
                --

                Originally posted by Camnomis View Post
                I get by with advice on here and doing my own research
                Looks like code46 has already fallen at that hurdle.
                Best Forum Advisor 2014
                Work in the public sector? You can read my FAQ here
                Click here to get 15% off your first year's IPSE membership

                Comment


                  #9
                  Originally posted by TheFaQQer View Post
                  Looks like code46 has already fallen at that hurdle.
                  And that is just one area he is aware of. What else is he doing wrong that he doesn't know about yet.
                  'CUK forum personality of 2011 - Winner - Yes really!!!!

                  Comment


                    #10
                    Originally posted by Scruff View Post
                    The simple answer is "Yes".

                    Your writing style is in the same vein as the Sockie who pops up too regularly to be taken seriously. 🔔🔔🔔
                    Hi Scruff,

                    Thanks for the answer. I'm sorry my writing style may look a bit strange, maybe too verbose. I'm a foreigner and I consider my English barely usable.

                    Comment

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