1. How much will I take home working through my own Limited Company?
Typically, contractors working through their own limited company take home between 75% and 80% of their contract value. This will vary from person to person and be determined by your eligible expenses, the choices you make regarding payments and other factors, pension contributions, salary, etc. Click here to use our online income calculator
2. How do I know if I am IR35 compliant?
The only way to be sure whether your contract falls inside or outside IR35 is to have it reviewed by a specialist. We would be happy to advise you on this. Click here to read more about our IR35 services.
3. What expenses can I claim?
You can claim back anything that is "wholly and exclusively" incurred to carry out the day to day running of your business. Examples may be business travel expenses insurance, accountancy fees, motor expenses, computer hardware and software, telephone, stationery, home office, training, etc. Click here to read more on Claimable Expenses.
4. How much do you charge?
We charge £125 + VAT to set up the limited company initially and our ongoing monthly services fees are £99 + VAT per month. There is no charge to transfer from your current accountant to us, there's no minimum length of time you need to appoint us and there are no termination fees if you decide to leave us.
5. When are my Year end accounts due for filing at Companies House?
Your Year End Accounts are due at Companies house 9 months after your individual year end. We will prepare this for you and then send it to you for signature and delivery. Click here for other important filing dates.
6. When is the Corporation Tax payable?
Your Corporation Tax Payment is due at HMRC 9 Months + 1 day after your year end. We will advise you of the amount payable based on the monthly reports you submit to us. Click here for other important filing dates.
7. What are the differences between the normal VAT scheme and the Flat Rate scheme?
On a normal VAT scheme a company charges VAT at 15% and pays this VAT to HMRC at less the VAT paid out on expenses. However the 2002 Budget saw the introduction of an alternative to the normal method of VAT accounting. This has been modified from December 2008 with new, lower rates. Brought in to help small business, the Flat Rate Scheme allows eligible businesses to calculate their net VAT liability as a flat rate percentage of their total turnover, inclusive of VAT.
8. Would I benefit from being on the Flat Rate scheme?
If you do not have many expenses to put through your company on a monthly basis, you may very well benefit from this. You can still claim expenses, however the vat on the expenses cannot be claimed back.
9. When do I need to submit my monthly reports to Carrington?
You need to submit these to us each month, by the 10th of the following month. E.g. January’s reports to be sent to us by 10th February.
10. How soon after my year end will I receive my accounts and CT figure?
This depends on when you submit all the relevant reports to us. We will ensure they are prepared in time for all deadlines and give you plenty of notification of any Corporation Tax liabilities to pay.
11. When do I have to pay my VAT to HMRC?
Your VAT is payable to HMRC four times a year, each quarter, one month after the quarter end. We will calculate your VAT for you and advise you how much to pay and to whom. We will also submit your company VAT return to HMRC on your behalf each quarter.
12. Does Carrington charge me each time I contact them for advice or if I have a tax question?
No, we do not charge by the hour. Our clients pay a set monthly fee of £99 + VAT and this includes all services. You will know who your accountant is and be able to contact them at any time.
13. What if I decide not to use my company after 6 months and stop trading?
You have the option of making your company dormant, however you will still need to file annual accounts with Companies House. Our fees will reduce to £50 + VAT per month in order to continue assisting you with your company while you are dormant.
14. How do I pay my fees to Carrington each month?
We will help you in setting up a direct debit against your company bank account when you sign up as a client of ours. We will debit our fees on the 10th of each month. Regretfully we cannot accept cheques or standing orders.
15. How many dividends can I take per year?
It is entirely up to you how you manage your company, but we recommend that you draw one dividend per quarter from your company. We can assist you in calculating how much this should be and advise you how to draw this.