If you are a contractor preparing to set up a limited company it is in your best interest to work with an accounting firm. They can provide you with many of the steps required making it easier to focus on your business and start up instead. At 3 Wise Bears we can assist small businesses and contractors with all sorts of accountancy matters, including:
Setting up a limited company means you are registering a company under a specific name and that that company will then be responsible to set up a bank account and will be able to earn or lose money, acquire debt and be required to pay taxes. Many contractors set up a limited company as it allows them to build an identity as well as provides the best choice when it comes to taxes. An accountant can discuss the pros and cons of setting up a limited company.
Naming your Company
There are a few steps you must take when setting up your limited company. Using an accountant is the easiest way to work as they can perform many of the tasks on your behalf. You will have to do a few things on your own such as naming your company. Try to name your company with a generic name unless you know your true calling is to do something specific such as consulting, decorating, etc. This way if you change the nature of your business you do not have to register a new company name.
How an Account Helps
There are several steps left that will have to be taken care of and an accountant can handle them for a very reasonable price. You will then also have the benefit of having an accountant from day one for your business which will save you plenty of hardship once you get started. Your accountant will manage the following for you:
• They will set up your limited company for you
• They will register your Value Added Tax (VAT) which is required for all businesses who will make more than 77,000 annually
• They will open your bank account offering a referral which is very important as many banks are hesitant to offer new companies a new bank account
• They will also handle your corporate tax registration for you
More about VAT
Having an accountant available to assist with VAT is important for new contractors as it can be complicated understanding how they are applied and whether or not it will affect your business. It sometimes takes a while for your VAT registration to come through and it is important to still charge clients the VAT and let them know you will be doing so once your registration goes through. Your accountant can assist with calculations to save you the pain of using the online forms. As well when it comes time to process your VAT returns you can simply hand over the paperwork and they will do everything for you. Just be sure your accountant does provide this service before you hire them for your limited company set up.