by SJD Accountancy on June 14, 2013
Contracting becoming the new ‘norm’
According to a number of reports released in the news lately, contracting is now becoming the ‘norm’. Contracting has never been so lucrative – with many UK businesses realising that contractors are not simply there to help them fill in staff gaps, but can instead be an extremely valuable asset to their
company.
Research has shown that the majority of businesses are very supportive of flexible working and, in the 2013 Institute of Leadership & Management (ILM) ‘Flexible Working: Goodbye nine to five’ report, two thirds of respondents said that flexible working increased commitment to the business and 78% said that it helped to retain staff. Click Here for more >
by SJD Accountancy on June 7, 2013
There has never been such a good time to become a contractor, especially as recent research has proven that contracting is becoming the new ‘norm’, as more and more
businesses are accepting that contractor’s can be an extremely valuable asset.
There’s also the fact that more employer’s are willing to offer work to contractors, because it is more cost effective than employing a permanent worker. Although a contractor can potentially earn more money than a permanent employee, they are not entitled to the same expensive benefits, such as holiday and sick pay.
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by SJD Accountancy on May 31, 2013
What is VAT?
When trading through your own Limited company, there are two different types of tax that you will need to pay. These are: Limited company taxes and personal taxes.
Value Added Tax (VAT) is one of the business taxes, so, if you are VAT registered, you will need to add the current rate of 20% on top of whatever you sell.
When do I register for VAT?
You won’t need to register for VAT until your turnover reaches £77,000 (2013), however, many people, such as those contracting through their own Limited company, are recommended to register even if they are below the turnover threshold.
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by SJD Accountancy on May 24, 2013
Dividends are payments made by a company to its shareholders out of its profits, as well as being another way of paying yourself as the owner of your business.
As the owner of your own Limited company, you will need to decide how much to take out as dividends and how much is best to take out as salary.
To calculate how much you should allocate as dividends, remove all company expenses from your company turnover and then subject the total sum to the small companies’ tax rate. You are then free to distribute the remaining cash as dividends. They can be paid at any time as long as the profits are available from your business bank account and you must be outside IR35.
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by SJD Accountancy on May 17, 2013
Working through your very own Limited company can be an extremely rewarding life choice; you have complete control over your business, more flexibility and can potentially earn more than a permanent employee.
Why choose Limited over Umbrella?
When it comes to deciding how to trade, there are two recommended options – either through your own Limited company, or through an umbrella company.
By contracting through your own Limited company, it will be the most tax efficient way of working. You can expect to take home around 75% – 80% from trading through your Limited company, whereas you could see yourself taking home around 60% – 65% with an umbrella company.
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