If you’re thinking of starting out on your self employed journey via a Limited Company, this is an essential read to ensure you avoid some common pitfalls. Formation Houses Setting up a limited company is quick and easy. There’s a huge number of businesses, known as Formation Houses, out there that will form the company for you for a fee. A bit like choosing the best tech to … [Read more...]
Self Employed Key Facts 2020 / 2021
Each year this blog is updated as the tax rates and personal allowance changes. These are the facts and numbers for 2020 / 2021. If you work for yourself or start a business on your own and are operating without incorporating it as a limited company then you are referred to as a sole trader. The term sole trader is interchangeable with being self … [Read more...]
Salary and Dividends for 2020 / 2021
Your profit extraction Strategy from April 2020 While it feels like normality has deserted us, it is that time when I give my regular update on your annual profit extraction strategy. Once again please do bear in mind that this Salary and Dividend blog gives our recommendations for taking a salary and dividends from your limited company. The figures are generic and may … [Read more...]
Why I recommended FreeAgent
It’s hard to watch prime time terrestrial TV these days without an advert popping up for accounting software telling us how to make our accounting and bookkeeping easier. The last ten years or more has seen an unprecedented rise in the use of online accounting software. Starting off small and easy to use, many systems have evolved into function rich offerings with multiple … [Read more...]
Income, Profit, TAX POT and Earnings
Going freelance, starting up your own business or being your own boss means keeping a close eye on finances to make sure things are going well enough for you to be able to take some money out of the business to live on. However, not everything that you invoice and collect from your clients or customers, less your costs, belongs to you. Not all of it is your … [Read more...]
Costs and options for closing your contractor company
The IR35 changes will result in many contractors exiting this sector and seeking full time permanent employment. As a result their Limited Company needs to be finished up and closed down. For most with very straight forward affairs this will be a very simple process and will be cheap to do. For some, and to maximise the tax benefit of Entrepreneur’s Relief, the close … [Read more...]
Self Assessment Tax Due Shocker – How much?
Each year as Self Assessment Tax Returns are prepared and tax calculations made gasps of “HOW MUCH” can be heard around the country. Why is your tax bill a shock? It never ceases to amaze me that many self employed are shocked by their tax bill with little understanding of how much profit (income less costs) they’ve made in the year. Understanding your finances and … [Read more...]
What Dividends do you put on your Self Assessment?
If you operate your business via a Limited Company you’ll likely receive remuneration for your efforts via a salary and dividends. As well as doing all of the filing of accounts and Corporation Tax Returns for your Limited Company, if you have untaxed income such as Dividends upon which Dividend Tax is due, you will need to complete a Self Assessment Tax Return. What is the … [Read more...]
Can I claim for my clothing?
Emily Coltman from FreeAgent guides you through if you’re able to claim your clothing costs through your business. This blog has been provided by FreeAgent. View the full image at FreeAgent … [Read more...]
HMRC call Accountants Agents – very 007!
There are many things that HMRC do which brings confusion to those that have to deal with them. One of them is to call accountants Agents. An Agent Obviously HMRC are using the word Agent in its true meaning; an Agent is someone who acts on behalf of another person. In reality you can ask anyone to act on your behalf when dealing with your tax affairs; an … [Read more...]
Nerdy bit – a brief introduction to double entry in less than 600 words
The classic joke amongst accountants is that “Accountants never retire they just become unbalanced”. I say joke – as a comedian I make a very good accountant. Jokes aside the whole system of accounting is based upon a system of double entry bookkeeping where for every debit there is a credit meaning that the books always balance. It’s a neat, tidy and ordered method that … [Read more...]
How to reduce a silly amount of share capital
Enthusiasm may have got the better of you when you formed your limited company resulting in an enormously silly amount of share capital being set up and allocated to you. Statement of Share Capital When you form a company you provide a statement of share capital which details the shares that have been issued to, what is known as, a subscriber or shareholder. The statement … [Read more...]