bing-bonger

...guys I'm gonna be leaving work soon. And want to go cotracting,

I have never contracted before so:-

1) What do I need to do in order to set up a limited company and also how does one get it set up?
2) How does VAT get worked out if i'm gettin paid a daily rate?
3) How long does it take to set a limited company up?
4) Where do it set it up?
5) Are there any clauses that I should look out for?
6) Finaly is it worth setting up a limited comany or is it better to co with an 'umbrella' compnay?



thanks for your advice guys...

Scooby96

I have a email link at work to a company that set up Ltd Co's from £49 - mail me chris.knowles@axa-ppp.co.uk and I'll take a look tomorrow and mail you back the details.

Redkop

LIMITED COMPANY INFO

eClaire

www.businesslink.gov.uk

Brit_in_Japan

Some accountancy companies will set up a limited company for nothing if you give them your accounts business for 12 months. But before going Ltd Co you should investigate whether there are other options which may be more cost effective.

If you aren't going to do it for long, PAYE via a contract agency is least hassle.

Or there are umbrella companies which can provide a service, handling all accounts/tax and also expense claims, for a monthly admin fee of course.

Make sure you read up on IR35 before taking any contract. Get an IR35 "proof" contract if you can and get it assessed independently so you can provide evidence to the Inland Revenue that you intended/believe it falls outside IR35. Be aware that the govt is trying to tighten IR35 further and effectively get rid of one man companies, or at least the financial advantage of them.

If you want to do all your own accounts/paperwork/returns then you can decide whether or not to register for VAT, which cuts out a load of papaerwork. Your revenues would have to be less than a certain amount though (about 60k IIRC).

In short, read up about it first and decide which route is best for your circumstances.

Hope that helps.

AndyBrew

I set my own limited company up it cost me about £30 look on the www.companieshouse.co.uk for details they have all the forms and stuff for you to download, and if you ring them up they are dead helpful with advice etc. You'll then need to get hold of a set of standard documents for your articles of association etc. you can download these from numerous web sites for about £10.

I would then suggest you get yourself an accountant and let him have a look at your paperwork before you send it off! It takes about 3/4 days for them to turn it around. Alternatively pay someone to set it up for you but don't pay £600 like one charlie quoted me!

There is also a company name search facility on there web site so you can pick yourself a name, its not as easy as you'd think LOL!

Register yourself for VAT otherwise anyone looking at your invoices will immediately think your a diddy business, even if you are you don't want people thinking it unless you can help it.

If you have any hardware purchases and have the reciepts you will then be able to claim the VAT back for the previous 3 years Register for cash accounting and then you won't have to pay the VAT on your sales invoices until you have recieved the cash.

IR35
====
If your contracts involve sitting on your customer sites using their hardware etc. you are gonna get a visit from the Inland Revenue and its gonna be expensive!

In my opinion avoid going Ltd unless you really have to as the red tape associated with it is a barsteward, your annual accounts bill will probably be around £1,500, whereas sole trader will be £300'ish!! PAYE payroll is an ******* to administer, sole trader you just take the money out as drawings and let your accountant worry about the tax at the end of the year.

Put aside 40% of your income towards income tax, and if your lucky you'll have a nice wedge left!

Get yourself a copy of Sage Accounts and go on a short course to learn the basics it will save you time later, and money with your accountant!

If you have little commercial knowledge at this point and are really unsure go to Business Link @ www.businesslink.org as they run free courses to get you up and running, they also have knowledge of various grants and start-up loans you could be elligible for, my mate got a £10,000 interest free loan repayable over 9 years, though he did have to produce a business plan etc.

Just a few of my thoughts

workshy_fopp

I'd say go down the Ltd. company route. You can get a company / certificate of incorporation on the same day if you take one "off the shelf" which means you choose from a list of pre-formed companies or you can choose your own name which will take slightly longer and cost more. Search for "company formation" on Google. Will cost anything from £40-£100 - doesn't really matter, you'll be claiming that as an expense anyway.
Re IR35, the chat at the moment is that it'll be replaced with IR5.91 come April, which will cost a bit more in tax, but will hopefully be a lot clearer.
Try to get a recommendation for a local accountant from someone, I wouldn't use one by post.
Re VAT, you pay it quarterly, charging it on top of your hourly rate. You would normally invoice monthly and add vat.
The threshold used to be 56k, but I think it's 48k now?
All you need to start is your Certificate of Incorporation, and a company bank account, then you can start invoicing