After HSMP : Best option : To open limited company /umbrella

[miki]

I have got initial approval for HSMP.

Planning to open new Limited company and will do conracting jobs through that.

Who is the best accountant for IT contractor ?

Which is the best bank for buisness account ?

I have collected many accountants name from contractoruk.co.uk like Contracting Made Easy,Accountants 4 Contractors,Trafalgar Accounting Solutions Ltd.,K & B Accountancy Group,1stContact,Dynamic Management Solutions Limited,SJD etccc...

Many banks are avlb. like Barclays,Natwest etc....

Bit confuse as with whom I should start...

I hope for IT contractors, to open new limited company is best option. (In terms of tax saving)

For extension(FLR) after 2 yrs, what precautions should we take if I open new limited company.

Please share your experiences.

[ssharma78]

did you try contractorsinuk(dot)co(dot)uk? they specialise in providing accountancy services for guys on HSMP.

-ss

[niruv]

Dear Miki,

Your post is very interesting for me.
I also got HSMP for two years and planning to arrive in june 1st week.
Can you please explain how can we save tax, if we do contract jobs thru a limited company?

I am also into IT field.


Thanks!!
Niruv.

[desertman]

i am in the IT field nd going to uk on HSMP in 2nd week of june.

i m also much interested in knowing more in detail abt these limited companies. plz explain it.

thanks

[kck9]

any replies to this post, please..........

[skilachi]

Hello All,

I've been contracting for the past 4yrs....IT field and find using Umbrella companies easy and safe to use. Cos all you do is fill out ur expenses for the month and that expenses is taken (tax free) from the total pay.

E.g if you earn £2000 a month contracting and say ur expenses for that month is £1000, which will be taken out (tax free) of the £2000 u earned for the month, so you are left with say £1000 meaning the amount to be taxed is £1000 and not £2000 as ur expenses are tax free. So by the time the umbrella company calculates there own admin fees (eg £100 or less) the remaining £900 will now be subject to tax, which will be like £200 (tax, NI), so u will have another £700 as salary.

So now ur total take home pay will be £1000 (ur tax free expenses) + £700, which will be £1,700 for the month.

But you u have ur own limited company, you'll be doing ur own tax, payin an accounts to do it for you, need a company accts etc....too much stress but in the case of umbrella companies, they will do all ur tax for u so no need to worry, all u need to know is ur money is in ur personal acct monthly.

Although i'm sure u can save more money if u use ur own limited company as i have some friends were using umbrella when they 1st started contracting and now have got their own limited company and some are still using umbrella companies, its juts a long thing, cos at the end of the year, you will need to fill in ur own tax an dif u are late or dont fill it in-time, u 'll be fined and also there is a new legislation u might wanna know if u want to use ur limited company........MSC (Managed Services Company) companies are banned (google up on it).

If you want the umbrella company i'm using, can refer u as i've been with them for 4yrs and i get my money in time as long as you sign ur timesheets and send it to ur agency to pay the umbrella company.

If its ur 1st contracting role, wud advise u use an umbrella company at first, then if you are not comfortable with them, then go for ur own limited company.

[gordon]

Just to confirm, taking your example, skilachi, if you were to declare 'gross earnings' would that be 900 per month, after expenses and the admin fees ? I ask with regard to the expected need to demonstrate gross earnings of a certain magnitude for FLR later on.

[miki]

Thanks skilachi.

For this detail information.

[niruv]

Thanks skilachi.
Can you please PM me the company name from which you r getting the pay?

Thanks!!
Niruv

[Azlan]

Opening a ltd company become lillte bit risky these days.
As Mr Brown changed a lot of rules around. Again going to MS compnay also become a target of Revene services.

Best is to get a company who legelly save your money. I don't suggest to take risk for few hundred pound a year.

We have a billing company, our claculations are in pure black and white and I can assure you the Reliability .

For more information mail me at Azlan.san@gmail.com

There is no harm in having chat isn't it.