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Contractor? SME owner? You’re going to need a specialised accountant

by Scott Brown | Mar 26, 2018
  • You’ve probably considered getting an accountant to handle your financial affairs at some point. However, the type of accounting help you need will depend greatly on the size and structure of your business. We cover a few scenarios below so you can figure out what kind of accounting help would best suit your needs.

    A freelance writer

    Most UK freelancers/contractors start out trying to handle their own finances, and then quickly realise that the complex legislation around contracting makes it difficult to know whether or not you’re compliant. Are you paying enough tax? Too much tax? Could you be paying less? The thing that many contractors discover when they employ an accountant is that you can structure your business in such a way that you can take advantage of great tax benefits.

    If you set up a limited company and do your freelancing work through it, you’ll pay Corporation Tax on your profits instead of Income Tax. Corporation Tax is set at 19% for the 2017/18 financial year, whereas the basic Income Tax rate is 20%, and the higher rate is 40%. What’s more, the UK government aims to cut Corporation Tax down to 17% by 2020. So, if you choose to work through a limited company, you’ll save on tax, and also benefit from a more professional image for your business.

    See also: How long will it take me to set up a limited company?

    A 10-person marketing start-up

    It seems simple. You only have nine employees, and you’re just starting out, so billing shouldn’t get too complex yet. Unfortunately, this isn’t quite the case. What lies before every new UK business owner is a minefield of regulation and administration that shouldn’t be underestimated.

    Most business owners are intimidated by how complex the tax legislation can get, and in desperation they turn to the first decent accounting firm they come across, but this isn’t the best course of action. What your business needs is a smaller boutique UK-based accounting team that will be able to advise you on UK tax legislation, but also explain it to you in terms you can understand. You’ll find that, if you choose the right one, your accountant will save you time and money, as well as provide invaluable foresight for your business.

    An IT contractor

    Many IT contractors in the UK will think about opting for accounting software as opposed to an accountant. It’s understandable - accounting software can do your bookkeeping and prepare a set of accounts, which will no doubt make your life a lot easier. But when you’re a contractor, compliance, tax planning and evaluating your strategic options are central to furthering your career and ensuring your take home pay is the highest it can be.

    An experienced contractor accountant will be able to suggest tax mitigation strategies tailored to your unique circumstances as your business grows. For example, once you start earning above a certain amount, it becomes more cost-effective to run through a limited company. What’s more, an accountant can guide you through general small business legislation and rules that you need to be aware of. Once you feel like you’ve found your feet, you always have the option of moving on to a more basic online accounting package.

    Need a specialised accountant?

    A restaurant group with 200 staff members

    As the owner of a medium sized business such as a restaurant group, your main focus will be running your business as effectively as possible. When you have staffing, marketing and general operational tasks to take care of, the last thing you need is to be worrying about your accounts.

    Getting an outsourced, specialised SME accountant to take care of the books will provide you with complete peace of mind, as well as a good understanding of your business’s finances and financial drivers.

    Our specialised contractor and SME accountants in the UK can assist you with all of your accounting needs. What’s more, out accounting packages can be tailored to your personal needs – we can offer as little or as much assistance as you need. Give us a call on +44 (0) 20 7759 7553 or send us an email on to get started.

    We are a professional services company that specialises in cross-border financial and immigration advice and solutions.

    Our teams in the UK, South Africa and Australia can ensure that when you decide to move overseas, invest offshore or expand your business internationally, you’ll do so with the backing of experienced local experts.

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