As a contractor, it’s likely that you have left a job where you were provided with a range of benefits from your employer – such as a company pension scheme, Death in Service cover or income protection.
These offer valuable protection for you and your family and it is essential that you review your requirements in each of these areas to ascertain if you need to replace the lost benefits now that you are working for yourself.
We have been working with QAccounting for several years to deliver tailor-made financial solutions for clients and, as a result, we are very aware of the areas of advice that should be priorities for you.
Making the change from employee to contractor, typically being paid by a day rate, can mean that your earning potential increases dramatically. However, your income relies completely on your ongoing ability to work. This means that there would be serious implications if you were absent due to an illness or injury, as you may find yourself unable to meet your ongoing expenditure, including mortgage costs, car finance, utility bills – even your weekly food bills and general living expenses.
Even if you have protection in place – be it life assurance, critical illness cover or income protection – when were they last reviewed? The cost of life cover has come down in recent years, and income protection benefit is, by its very nature, based on your income and this can fluctuate. You could find yourself with too little cover or, conversely, you may be paying a premium for benefits that you would be unable to claim.
There are various ways of providing protection, whether through your business or personally, and significant savings that can be made by reviewing your cover. For example, even as a one person limited company, it is possible to have life assurance which is similar to the Death in Service arrangements provided by larger employers, with the benefits based on a multiple of your earnings and premiums paid by the company.
Another type of protection is Private Medical Insurance. This can be extremely useful to a business owner as it provides the opportunity to plan when and where you receive medical treatment. Indeed, there are now plans available that can provide you with a cash sum, so you can even elect to receive treatment overseas if that is a more convenient or cost effective option.
As financial advisers, Kudos specialise in how to maximise your personal and business planning, seeking to take full advantage of tax breaks and incentives available within the overall framework and tax structure suggested by QAccounting, with whom we work closely in these areas.
If you wish to discuss your own situation in more detail, please contact your QAccounting Account Manager, or call Kudos directly on 01224 652100.
Sole trader accounting can sometimes be simple: some sole traders may well find that they have no need whatsoever for an accountant. However, accountants for sole traders are an incredibly useful resource that can save you a great deal of hassle and time – and potentially even money. If you’re asking yourself, “Do I need an accountant as a sole trader?” – read on. In this blog we cover the ways in which accountants for sole traders can help, as well as how to choose the best sole trader accounting firm for your needs.
It’s not a legal requirement for those who are self-employed to use the services of an accountant. However, working with self-employed accounting professionals who understand the unique needs of the self-employed can often save you time, money and stress. Read on to discover more about the accounting needs of the self-employed, common accounting challenges you may face, and when working with an accountant makes sense.
If you’re a small business owner – or looking to start a small business – you may be tempted to handle the accounting side of things yourself. You may think that this aspect of the business will be simple when you’ve started small…but is this really the case? In reality, small business accountants can save you money. They’re a trusted partner for a range of things, from planning and setting up your business to financial management, tax obligations, business growth strategies and more. Read on to find out how small business accounting services could improve your chances of business success…