The post is good, covering many of the aspects, but if you are trying or just started contracting there is not always a need to make the VAT registration and Limited Company. As I have been freelancing for 4 years as a sole trader.
There are some tax benefits but you have to manage your pay and money very differently as a Ltd, i.e. you have to hold money in the bank enough to cover company bills that you cant spend. Unless you are a high paid contractor all year you are unlikely to make £82,000 VAT base rate.
Becoming a contractor programmer in the UK
171–174 of 174 posts
Re: Becoming a contractor programmer in the UK
#172Earlier quoted context omitted.
Where to begin Am I ready - The biggest bit is actually having the confidence to do it and a CV good that will get you past both the gatekeeper (the agent) and the client checking CVs... That means you should have real experience across both multiple employers and multiple market sectors (retail, consultancy, banking for instance) before thinking about it. Timing - Never understood this one. Projects have different l…
A few things to add to this. - put aside money Before starting try, really try, to have saved at least 1 months expenses - preferably 2 and ideally six. You won't get paid (as in a months salary in the bank) for a couple of months. companies have cycles for payments and if you are on the wrong end it can hurt - know your tax liabilities Sit down with your accountant and write a spreadsheet or a script that tells you…
Shameless plug, but if you need to set up a substitution agreement with another company, i.e. a "swapsies" partner, checkout https://agree.digital. It's generally a good idea to have documentation in place you can use as proof if HMRC come knocking!
Re: Becoming a contractor programmer in the UK
#173Earlier quoted context omitted.
Personally I prefer the 'human' accountant. I've been using an experienced accountant for many years, and continued on when I created the LTD. He also does my personal taxes, the PAYE etc. For the company, we 'share' a google spreadsheet that is very simple, I add my invoicing, expenses, and he uses that to do the VAT bits and PAYE. Very low overhead, and he's very cheap too -- he's also 1 mile away, so I go and sit…
What's cheap for an accountant? I'm paying about £800 per year for mine. I didn't really shop around as I had to set things up on short notice.
That'd be cheap for London. It's normal to pay 1k+ a year
Re: Becoming a contractor programmer in the UK
#174Earlier quoted context omitted.
Other recommendations of accountants with decent online systems would be greatly appreciated. My current ones (Nixon Williams) seem fairly good as accountants, but the spreadsheet based expenses (and having to use email to take dividends, check profit/loss, etc) are getting quite annoying, and they want to charge extra to use their registered address rather than my own, which leaves a bit of a bad taste when Crunch i…
I've been using NW for about three years now and am deeply ambivalent about them for similar reasons...
I'm unsure if you'll see this reply with the topic being quite old, but I found out today (via a Youtube ad, no less - well targeted, sort of!) that Nixon Williams now have an online portal, called Vantage: http://www.nixonwilliams.com/vantage - judging via the Wayback Machine, it has only been around since February this year.
If you speak to your account controller, they'll be able to set you up a dummy account to see if you like it - my understanding is that this would replace the monthly submissions of expenses and invoices, and give you a better real time view of your profit/loss, but you should still get the same level of service and attention paid to your account and it costs no extra. I'm still waiting for confirmation of all that (my worry being that I could make a mistake and it wouldn't get spotted, whereas it would with a monthly submission to a human) and for my account to be set up, so I can't comment any more on it, but it's definitely worth a look!