Note that the benefit of going Limited may depend on a number of factors. For example, the length of the contract you have been, whether you see contracting as a long-term career path, and the take home pay value of the job you are considering offered can all have an impact on your decision.
If you feel that setting up a Limited Company is a viable option, then this article applies to you. If not, we also offer sole trader options, where you can operate self-employed without the duties and responsibilities of going Limited.
1. Company Set-Up
If you decide that setting up an LTD company is the best option for you, then you’re in the right place, but we are often asked at QAccounting, how do I set up an LTD company? Companies House offer full incorporation starting at just £12, but this seemingly low cost is only under the proviso that you have everything you need in order to get set up. This means you have already thought up your company name, who the directors/secretaries will be, shareholder structure, the people with significant control, your business SIC code, and you have chosen between online or paper copies of your documentation. In short, without the right help setting up an LTD company can seem a bit daunting, but it doesn’t have to be.
Here at QAccounting we can handle the complete company set up for you. Within 24 hours we will aim to have you incorporated and set up with Companies House, and our accountants and in-house staff will work with you to ensure that you know exactly how best to get your business set up. That is of course provided that your company name is available (and suitable…).
2. Business Bank Account Set-Up
Next on the list is setting up your business bank account. All legitimate businesses with income and expenditure should be operating via a business bank account. Your business bank account is what contractors should be paid into, and expenses paid out of. You can choose whatever business banking provider you desire, but we implore that you ensure that you are getting the right deal for your business.
We are partnered with Metro Bank who offer fantastic rates and services to LTD Company contractors. The benefit of using one of QAccounting’s ‘preferred’ bank accounts is that we can fast track the set-up process for you, allowing you to get a business bank account that is right for your business in a timely manner. For anyone who may wish to switch any existing business bank account over to Metro Bank, we do offer a complete switching process, making this a swift and seamless process.
3. Full tax Registration
All new businesses are required to be registered for the appropriate tax with HMRC. Company tax and personal tax must be taken into consideration, and this process can seem confusing to those who are not aware of the various tax responsibilities of running a successful LTD Company. Here at QAccounting we can take care of this tax registration process on your behalf, ensuring that you have registered for all your UK tax, i.e., corporation tax, VAT and PAYE to ensure that you have met your HMRC requirements.
It is true that there are duties and responsibilities that operating via a Limited Company does incur, and there are none so important to consider than IR35. IR35 affects every contractor working via a LTD company. Otherwise known as the ‘disguised employee’ legislation it’s HMRC’s way of making sure anyone working and benefitting from operating as a LTD Company is not also working and benefitting as an employee.
At QAccounting we are pleased to work alongside Qdos Contractor, IR35 specialists and long-standing compliance experts specialising in IR35. They have successfully defended over 1,500 contractors saving their clients over £1.5m in tax. Via our partners Qdos Contractor we at QAccounting offer IR35 contract assessments, defence insurance and access to Qdos’ in-house specialists to ensure that our contractor clients are operating compliantly and confidently.
Insurance is a commodity that all businesses must consider to operate successfully. Insurance comes in many forms, and common business insurance for contractors provides cover against a claim being made against the policy holder because of accident/injury/negligence caused as a result of the work that you carry out. The most common form of contractor insurance are Professional Indemnity Insurance, Public Liability Insurance and Employers Liability Insurance. There are other insurances such as Tax Enquiry Insurance and Jury Duty and Legal Protection Insurance. Insurance acts as a way of protecting yourself against the costs of financial claims being made against you, and without the right insurance, your business is financially exposed. It is important to consider insurance from an IR35 perspective too, as having insurance in place helps prove to HMRC that you are a business in your account and are accepting financial risk.
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