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Going self employed. Pitfalls/benefits

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Joncrete Cungle
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PostPosted: 22:14 - 06 May 2018    Post subject: Reply with quote

How many hours / days a week do you work for £350? 25 years in the job I would expect you to earn more?
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jimspeed
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PostPosted: 08:43 - 09 May 2018    Post subject: Reply with quote

Joncrete Cungle wrote:
How many hours / days a week do you work for £350? 25 years in the job I would expect you to earn more?

930 -6. 5 days a week . Its a bit crap but we are in the sticks a bit.
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panrider_uk
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PostPosted: 09:23 - 09 May 2018    Post subject: Reply with quote

Just not having the paperwork hassles alone makes having an accountant worth it in my opinion.

Fees for a sole trader are quite modest.
If you go Limited then they will be double or triple.

But, as has been said, any decent accountant will save you more than they cost you.
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stephen_o
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PostPosted: 11:47 - 09 May 2018    Post subject: Reply with quote

I haven't had an accountant since 2010. I used to have to have an accountant and could only use 1 from a panel when I was in a franchise and their estimate of £600+vat turned into over £2000+vat for the 2nd year. A local accountant also burned me for nearly the same sum in 2010 after originally quoting £600 + vat initially.

Be aware that free advice is not part of having an accountant, each time you ask them a question they will add a charge to your account.
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panrider_uk
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PostPosted: 14:13 - 09 May 2018    Post subject: Reply with quote

stephen_o wrote:
I haven't had an accountant since 2010. I used to have to have an accountant and could only use 1 from a panel when I was in a franchise and their estimate of £600+vat turned into over £2000+vat for the 2nd year. A local accountant also burned me for nearly the same sum in 2010 after originally quoting £600 + vat initially.

Be aware that free advice is not part of having an accountant, each time you ask them a question they will add a charge to your account.


If you have a good relationship with your accountant then you should get free advice. Mine doesn't charge me for anything other than doing my accounts and self-assessment forms.

My previous accountant was charging me £600/year for my accounts (limited company) + £100 for the self assessment.

My new one (she actually did my accounts when employed by the previous firm) charges a lot less than that.
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AshWebster
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PostPosted: 17:46 - 09 May 2018    Post subject: Reply with quote

i know people who arent self employed and have accountants.. theres lots of ways of paying less tax in the UK..not that im up to date on how to do this like...

my brother is training to be one as we speak so hopefully i can rope him in to do mine and ill pay him back with free car repairs (Y)
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BTTD
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PostPosted: 08:50 - 10 May 2018    Post subject: Reply with quote

RhynoCZ wrote:
And I'm pretty sure you may google/ask the tax office what tax deductions you are entitled for.


You can ask that question, but HMRC will not help you to organise your affairs in a tax efficient manner. They'll just tax the sht out of you and then look for more stuff to tax you on. You can google it and indeed, all of the required information is on the .gov website, however the UK system genuinely is a mess in many respects and deciphering the best course of action isn't straight forward. And if you get it wrong then you risk fines and interest (although in the case of genuine mistakes fines are usually waived and just the tax and interest are payable).

RhynoCZ wrote:
Given, accountants do not work for free and what they might ''save'' you on tax deductions/evasion may not even cover their fees.


Whoa there! Tax "evasion" will see you in court. Tax "avoidance" is perfectly legal (although some highly inventive schemes are considered immoral by communist fags).
But yes, if your situation is simple then just fill out a self assessment form and pay the tax you owe at the end of the year.
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Rogerborg
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PostPosted: 09:31 - 10 May 2018    Post subject: Reply with quote

jnw010 wrote:
Tax "evasion" will see you in court.

Will it, though? HMRC don't even do their own prosecutions, and the CPS and Fiscal are busy prosecuting Nazi dogs. HMRC don't have any special powers to investigate regular low level tax dodging that doesn't involve other criminality - all they can do is ask you to pretty-please incriminate yourself.

The first time I had to do self assessment, I fretted over every penny. Now I just bang through it without really reading, and get back / get rammed for whatever fantasy number Friend Computer comes up with.

Don't sweat it, would be my take-away point.
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BTTD
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PostPosted: 09:44 - 10 May 2018    Post subject: Reply with quote

Yes, that's true enough. HMRC will invite you to declare any other known issues once they find a loose thread to pull on, but willful evasion is markedly different to an oh dear I've ballsed this up a bit scenario. Evasion is the clear criminal intent (in my understanding). Even so the likelyhood of being imprisoned like Al Capone is pretty non-existant. I don't know of any UK long sentences for tax evasion.
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M.C
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PostPosted: 23:10 - 10 May 2018    Post subject: Reply with quote

jnw010 wrote:
Whoa there! Tax "evasion" will see you in court. Tax "avoidance" is perfectly legal (although some highly inventive schemes are considered immoral by communist fags).

Is that like living in the UK and getting your wages paid into a company in Malaysia? Or buying a private jet and importing it via the IoM?
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BTTD
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PostPosted: 09:43 - 11 May 2018    Post subject: Reply with quote

M.C wrote:

Is that like living in the UK and getting your wages paid into a company in Malaysia? Or buying a private jet and importing it via the IoM?

Shifty I will neither confirm or deny how I buy my private jets.
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Old Git Racing
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PostPosted: 14:43 - 11 May 2018    Post subject: Reply with quote

I'm self employed, sole trader. I do my invoicing, expenses, records on excel spreadsheet templates I did my self, then at the end of the year give them to the accountant,and for £300 ish he arranges it nicely and submits my tax return, no hassle and worth it.
Benefits-
Obviously you can work when you want. sometimes I'm flat out, sometimes nothing on for a week but it seems to balance out.
People seem to take you more seriously, and give more respect. I do some work for former employers and the change in attitude is surprising.
You don't have to work for knobheads if you dont want to.
Other peoples actions dont affect your career only yours do.
Cons-
If you cant work, e.g. accident you dont earn, you can get insurance.
You need to get some kind of liability insurance set up.
Even if you hate paperwork you have to be disciplined and do it instead of going out on the bike.

The first months are the most difficult, the gap between invoicing and getting paid.
Charge what you're worth, a lot undercharge.
Dont let customers take the piss paying, get onto them if they owe you. I will only work for some people if they pay me upfront after they took the piss but they still come back.
Any tools or equipment you use, get the best. Doing it professionally is a lot different to a hobby.
Try not to get left behind in the technology in your field, easy to do if you dont see it evolving in a company environment.
If travelling a lot get a decent car with good MPG. I've got a Merc 250, auto gears, air con, good seat, 55mpg on a motorway run. Also looks better than a cheap shitter when turning up at the job.
Look smart, design a company logo, make a PDF and get some polo shirts embroidered, makes you feel better and looks good to the customer. Get some business cards to give out, they remember you for next time.
The hardest thing to do is to get a reputation, you will be under scrutiny and there's nowhere to hide. Do what you say you are going to do, when you say you will do it, and do it better than anyone else. Don't take things on beyond your ability although you will probably have to wing it sometimes.

It really worked out well for me, wish I'd have done it earlier. I'm not a millionaire, never will be but am certainly better off moneywise and headwise.

OGR
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Powderhead
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PostPosted: 17:57 - 11 May 2018    Post subject: Reply with quote

stephen_o wrote:
...over £2000+vat for the 2nd year. A local accountant also burned me for nearly the same sum...


That's an absolutely ludicrous figure. If you're paying more than around £1k + VAT per year, you're getting royally ripped off.

stephen_o wrote:
Be aware that free advice is not part of having an accountant, each time you ask them a question they will add a charge to your account.


Don't engage an accountant that doesn't charge fixed fees. You should get a very good accountant who does absolutely everything for you, including answering any questions you have, for a fixed fee of around £80+VAT per month at most. That way, you know what you're spending, and you can take as much of their time as you need in order to get things done properly without worrying about them sticking a £50 charge on your account every time they take a phone call.

stephen_o wrote:
local accountant


I read this from people a lot, and I wouldn't bother going with a local accountant. There's no need. I've used accountants from Brighton to Manchester, and I've never needed to physically see them at any point over the last howevermany years. You're better off with a firm 100 miles away who specialise in people doing a similar line of work to you than you are with some bloke round the corner.

Old Git Racing wrote:
excel spreadsheet templates I did my self


This is another thing I see people doing a lot, but give FreeAgent a try (or Xero, if you're a larger Ltd company rather than a sole trader or a 1-man/2-man Ltd). I am a qualified accountant myself, and I can honestly say I will never go back to a spreadsheet again!

I said it earlier in the thread, but it really is worth repeating: ONLY ENGAGE AN ACCOUNTANT WHO USES FREEAGENT (or Xero, if you're planning on running a company with more than 2 employees).
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M.C
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PostPosted: 22:09 - 11 May 2018    Post subject: Reply with quote

jnw010 wrote:
M.C wrote:

Is that like living in the UK and getting your wages paid into a company in Malaysia? Or buying a private jet and importing it via the IoM?

Shifty I will neither confirm or deny how I buy my private jets.

I assume with a shark card?
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Old Git Racing
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PostPosted: 23:21 - 11 May 2018    Post subject: Reply with quote

Old Git Racing wrote:
excel spreadsheet templates I did my self


This is another thing I see people doing a lot, but give FreeAgent a try (or Xero, if you're a larger Ltd company rather than a sole trader or a 1-man/2-man Ltd

I am a sole trader, this guy probably will be. It really isn't that complicated if that's what you are. As a sole trader I don't give a toss what system the accountant uses so long as its value for money, and makes my life easier. Most programmes are a variation of some kind of spreadsheet anyway, If you do your own it makes you understand whats going on without all the bullshit.

OGR
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Powderhead
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PostPosted: 11:17 - 12 May 2018    Post subject: Reply with quote

Old Git Racing wrote:
As a sole trader I don't give a toss what system the accountant uses so long as its value for money, and makes my life easier.


That's my point, FreeAgent will make a sole traders life a lot easier, and will be included in any decent accountant's fixed fee - £1k + VAT a year at most.

If your accountant is asking you to provide an Excel spreadsheet or a carrier bag full of receipts in 2018, you need a new accountant.
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stephen_o
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PostPosted: 11:28 - 12 May 2018    Post subject: Reply with quote

Thats what my old franchise accountants did for their £2000 plus bill, they wanted an excel spreadsheet, till prints and paperwork for every trading day and all the "expenses" bank statements the lot which I had to take a day out of the business to deliver 2 huge boxes full from Stoke-on-Trent to Stockton on Tees and then go and fetch them back plus they spent 3 months working through them.
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Itchy
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PostPosted: 11:35 - 12 May 2018    Post subject: Reply with quote

Powderhead wrote:
Xero


I used Digita, Iris and sage Very Happy. Though I've been out for nearly a decade Very Happy
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Powderhead
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PostPosted: 12:12 - 12 May 2018    Post subject: Reply with quote

stephen_o wrote:
Thats what my old franchise accountants did for their £2000 plus bill, they wanted an excel spreadsheet, till prints and paperwork for every trading day and all the "expenses" bank statements the lot which I had to take a day out of the business to deliver 2 huge boxes full from Stoke-on-Trent to Stockton on Tees and then go and fetch them back plus they spent 3 months working through them.


That's a pisstake Laughing

Itchy wrote:
I used Digita, Iris and sage Very Happy. Though I've been out for nearly a decade Very Happy


You can tell Wink
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stephen_o
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PostPosted: 20:33 - 12 May 2018    Post subject: Reply with quote

That's a pisstake Laughing

Oh I Know! I was at the time a franchisee and the accountant was the one recommended (insisted upon) by the franchisor - the accounts were due in March and were finally done in July - the franchisor was furious - threatening me with removal of the franchise even though I was responding immediately to every (and there were many) query - all of the delays were from their side - my "person" went off sick and in the end it got handed to someone else. In the end I was summoned to the franchisors head office where I was grilled by the 2 md's and their head of accounts and company secretary and they wanted to remove the franchise from me.

The saving grace was that during the delay the accountant had found that the franchisor had been overinflating the franchise figures and a couple of other things which allowed me to fight back.

Then they trousered my quarterly shop rent. It was them that got sacked not me.
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jimspeed
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PostPosted: 13:59 - 19 May 2018    Post subject: Reply with quote

Ok guys thanks for the advice now I've sat and had a think about things I am going to get my house sold and we will buy somewhere more suitable for us where I can either convert or build my own little workshop then I will be in a far better position to get it all working smoothly.
I'll update when anything useful comes along.. Thumbs Up
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