Do you want to work with an accountant who specialises in contractors and makes sure you are as tax efficient as possible? I’m going to tell you how you can do just that.
When choosing a contractor accountant, you need to make sure that your accountancy provider knows the way you work, the way your company works, and also the way you get paid. Having a provider that understands contracting is vital in maintaining the ease and ensuring the success of your limited company.
You might be a front end developer, quantity surveyor, engineer, or any other type of contractor. You might work on long-term contracts or work for many clients at once. But what you have in common with all contractors is that you are selling time, not products. This leads to different issues than other business models.
As a contractor, are you sure you have the right structure for your business? Sole trader, umbrella company, limited company? The list goes on. There are many unique structures available to contractors and getting it wrong can cost you thousands of pounds every year.
Does your accountant understand and advise you on IR35 and its effects on you? Are you sure HMRC won’t chase you for tax avoidance? They set up IR35 task forces to target contractors like you to increase the tax and national insurance paid. They are closing down many of the traditional tax schemes used by contractors.
Some accountancy firms showcase a very low monthly cost, but as any veteran contractor will tell you, sometimes it pays to pay that bit more. Always do your research and make sure that you’re getting exactly what you pay for.
Are you using the right VAT scheme for your business?
There are several schemes available, and choosing the wrong one can cost you a lot of money. Even if you don’t need to register for VAT, you may save money by doing so.
Do you know all the expenses and tax reliefs you can claim, and what reliefs are available when you are ready to close the business? Do you understand your monthly budgets? Your client pays you, but how much do you need to budget for taxes, and how much is yours to spend?
That’s why it helps to have outside help to look after the financial side of your business. You can at least have someone take some of the stress away by keeping on top of all this for you. Leaving you free to do what you do best.
So, how can a contractor accountant help you?
They specialise in helping contractors with their finances by understanding the issues you’re facing right now. They work with you throughout the year because they don’t want to just work with you at year-end as the deadline closes in.
A good contractor accountants wants to help you keep on top of your cash and your tax bills at all times. After all, do you only advise your clients when they are in a mess, or do you help them plan?
They usually provide innovative online software which allows you to keep on top of your figures. A good accountant will talk to you regularly. So they understand your business and advise you throughout the year, helping you before you make chief financial decisions, and take your cash out as tax-efficiently as possible.
Gone are the days of masses of paperwork and extensive filing in the world of accounting. Sophisticated technology is something that’s becoming ever more important to limited companies. There’s no need to keep your expenses in a shoebox under your bed and there’s no need to fill out any complicated spreadsheets. Your accountant should provide the technology that makes your duties as a company director easy and simple.
Looking at a firm’s reputation is a great way to see if an accountancy is worth its salt. The internet provides a great platform to ask questions and share your views about a potential provider. You should choose an accountant that has a proven track record within the industry and keeps their existing clients satisfied.
By understanding your goals, they can plan years in advance with you. This makes sure you pay as little tax as legally possible. So you can spend your valuable free time doing the things you want to do, and not worrying about your accounts and tax.