Limited Company Startup Recommendations

[Pointy-Hair]

Hi - yet another newbie here, with yet more daft questions that have probably been answered before (I have searched the board, but can't find specific answers...).

I have left the permie world after 12 years, and yesterday got my first contract - apparently that was the easy part, and now I am looking into the complex world of contracting.

I've decided that setting up my own limited company is the way to go so:
a) please can anyone recommended a company set-up provider (I know I can do it direct through Companies House, but think I've got more than enough to learn without doing that!);
b) do I need to register for VAT (turnover will be more than £60k)?
c) had a call from an agency offering to set up and run a company for me, for £29/week - sounds steep to me, but does anyone have any experience of this? (I figured that once I've got through this initial time of establishing the company etc that it would be manageable myself).
d) this agency mentioned about paying VAT at 12% IR, but charging it at 17.5% to the recruitment agency - hence profiting by 5.5%. Does anyone please know anything about this flat rate VAT?

Sorry for all the questions...!

[malvolio]

a) Get an accountant. Get the right one (SJD, 1St accountancy, a couple of others) and they will do company set up for you, either for free or for very little outlay. Do not try and do this witout an accountant that understands freelancing - General Ledger work is easy, tax is not.

b) Yes. Do it anyway.

c) B***cks. You'll have to do it for yourself sometime, so why not now. Agencies are not interested in your business, whereas you (hopefully!) will be.

d) Flat Rate VAT is exactly as described. Only thing is, if you are buying things (computers, software, whatever - you are in start-up mode!) you may lose out since you can't recover all the VAT you pay out. Ask your newly-chosen accountant for advice.

Otherwise, standard comments - read the first time guide here, visit www.pcg.org.uk and read theirs (and if you have any sense, join them, it's worth every penny), remember to think "I am professional freelance" at all times and best of luck.

[MrsGoof]

Firstly Congrats on joining the free world

Find an acountant and they will probably do the co. setup for free! there are a couple that frequent here. SJD and 1st Accountancy.

Yes Register for VAT. THe flat rate scheme is good if you don't intend on buying much. It works by you only paying a %age of the grossed up VAT you charge
so bill £1000 and add 17.5% VAT = £1175. When you come to pay HMRC then you take 13% (12% in first year) of the £1175 and pay HMRC £152.75 leaving you with £22.75 to keep. NOTE THE % you pay to HMRC is base upon the grossed up Invoice!

Simply find an accountant and they'll guide you.

HTH

MG

[Pointy-Hair]

Thanks for your comments - never realised there would be so much to learn and do to enter this strange new world of contracting...! Just got to keep remembering I'm free, free at last...!
Sounds like I need to get an accountant asap.

[malvolio]

never realised there would be so much to learn and do

Just keep that in mind. Contracting is no longer an easy money option, the big money is there but you have to work for it. There are a lot of people who will help you spend your money (as well as the taxman, of course) so "think before you commit" is a good motto.

Your tasklist right now is (a) get a good accountant, (b) get a limited company, (c) get a company bank account (Abbey, Carter Allen or HSBC are current favourites) (d) get VAT registered, (e) join the PCG, (f) find out everything that's wrong with your contract (there will be several things, believe me!) so you can do it better next time.

It's a whole new world you're in now. Have fun!

[Darren@UptonAccountants]

Accountancy



Looks like Mal's covered everything as usual, fancy a job Mal?

[malvolio]

You couldn't afford me...

[Pointy-Hair]

Thanks for your advice - planning to use SJD accountancy for both the company set up (£125 is a bit steep I thought, but they seem to do everything for that including VAT registration), and acountancy via their monthly package (£85/month) which takes care of most things I hope! May be the lazy option, but I figured as this is my first company and first contract then I'd get some expert advice, even if it costs. Barclays are offering free business banking for 18months, so I will probably go with them.
Couple of days to relax now, before moving over to the dark side in the New Year...!