There are many upsides to being a contractor as opposed to being a full-time employee, including higher pay and tax benefits, but at the same time, you have many more responsibilities to worry about.
Chief among these are deciding how to pay yourself and take care of your financial issues, such as tax, VAT and national insurance contributions. The most appropriate choices for a contractor being either a limited company or an umbrella company.
Given that as a contractor you will have to devote a lot of your time to finding work and ensuring you have a steady income, the complicated issue of tax is something you may struggle to handle by yourself, this is where an accounting service provider can help.
One of the main advantages of using a credible accountancy service provider is that they can tailor their services to your specific needs.
This means you get a bespoke service that is set up in such a way to deliver maximum efficiency and ensure you are on a stable footing going forward.
Your circumstances will determine whether you are suitable for an umbrella service or whether working as a limited company is the best option for you.
Working as a limited company is by far the most tax efficient way of working and an accountancy service provider can provide you with advice on setting up and running a limited company, allowing you the time to concentrate on the important task of finding work and sustaining your income stream.
You may be of the opinion that you can save yourself money by taking care of your own accounting and bookkeeping needs.
This is indeed true, however, unless you have a solid knowledge of UK tax laws, a strong head for figures and understand the requirements of Her Majesty's Revenue and Customs (HMRC), this could be a mistake.
You may make several errors in your accounting and have your records rejected by HMRC. On top of this, the hours you spend on your accounts could be put to better use, such as finding new business or spending time with friends and family.
By hiring a team of experts, you will be employing the services of professionals whose job it is to ensure the finances of contractors like yourself are accurate and satisfy the demands of HMRC.
Tax laws can change and if you assume responsibility for your own taxes, you must keep abreast of current affairs otherwise you could fall foul of the law.
Hiring an accountant with experience of helping contractors will relieve you of this burden.
In addition, a qualified professional can give you ongoing tax advice, complete your VAT and annual returns as well as your personal tax returns.
The issues of tax returns, payrolls and maintaining company records can take up a significant amount of your time.
What you get if you hire expert accountants is a team that will ensure your records and other financial obligations are met without any errors along the way.
Working for yourself brings several benefits and responsibilities. By bringing in accountancy services, you can reduce the burden on yourself and focus your efforts on other areas.
The financial side of your business is something you cannot afford to make mistakes with, so why not employ the services of an accountancy service provider who can assist you in running your limited company, leaving you in control of your company but without the headaches.
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