If you are considering incorporating a company there are a number of things you need to consider. A limited company works differently to operating as a sole trader and whilst operating that way offers a lot of benefits, it also carries some extra responsibilities and you need to fully understand those.
For a general guide on ‘Being Limited’ please visit our resources and guides.
Whether you are new to operating a limited company or have been trading this way for years, we have a full range of services to help you get the most from your business:
- Financial Accounts;
- Corporation Tax;
- Management Accounts;
- Company Secretarial services;
- Confirmation Statements;
- Personal Tax Returns;
- MTD for Companies;
By law, a Company Director is responsible for filing accounts with Companies House nine months and a day after the Company year end1. We can prepare these for you from source documents – your sales invoices, purchase invoices and bank statements or we can work from any manual bookkeeping, spreadsheets or other software that you currently use. We can also help you to find software that might be useful to you and offer different of levels of support as you need it to ensure your accounts are correct and submitted on time.
A Corporation Tax return is due ten months after the company’s year end although payment is due by nine months after the year end (HMRC do like to keep it interesting…).
We will prepare this for you on the basis of your accounts and file it with HMRC.
If you’re happy doing your own books, that’s fine with us but if you prefer to spend your time on other things, we can introduce you to keeping your books on software and train you on how to or we can take care of it for you. We can ‘keep your books’ on a monthly or quarterly basis depending on your needs.
1 The first year’s accounts have slightly different rules which is explained in our guides and resources.
As a Director, you get more from your business if you become an employee. If you also employ others or if you use sub-contractors in your business you have to run a payroll scheme and file returns to HMRC online every time a payment is made.
The responsibility of deducting the correct tax, National Insurance and other statutory deductions and responsibility for making proper pension arrangements lies with the employer (you).
We can help you keep on top of this by running your payroll, providing you with payslips for your employees, calculating the correct deductions, filing RTI submissions and CIS reports to HMRC and then making sure you know how much to pay HMRC, when and how.
Construction Industry Scheme (CIS)
Some businesses use sub-contractors from time to time even though these are not ‘employees’ you still have a requirement to deduct subcontractor tax, report the deduction to HMRC, make the payments and provide documentation to your sub-contractors.
If your sales reach the VAT threshold, you must register for VAT but there may be occasions and benefits for registering for VAT regardless of turnover.
Once registered, you must submit a VAT return (usually) every quarter. We can prepare this for you from source documents – your sales invoices, purchase invoices and bank statements or we can work from any manual bookkeeping, spreadsheets or other software that you currently use. We can also help you to find software that might be useful to you and offer different of levels of support as you need it to ensure your VAT return is correct and submitted on time.
With two qualified management accountants on our team and with the software that we use we can deliver a prompt and insightful management accounts tailored to exactly what you need to know to manage your business on a monthly or quarterly basis.
This service can give you informative and relevant information on a real time basis allowing you to make decisions based on the current state of your business, compare month on month or quarter on quarter helping you to identify trends or identifying where costs lay to make informative decisions on the direction of your business.
In addition to the requirements of filing accounts and a corporation tax return, a company director also has secretarial responsibilities with Companies House. These include:
- Filing a confirmation statement – details of the Company’s registered office, Directors’ details, Persons of Significant Control (shares and shareholding) etc are to be kept up to date annually;
- Change of company details – these have to be submitted to Companies House (and potentially HMRC) at each change;
We can provide this service for you and ensure the Company Director’s duties are fulfilled. We will also register the company to our office address which means that you’ll never miss any important correspondence from Companies House and you won’t have to put up with the junk mail! It also means that your home address isn’t visible on the public register.
Personal Tax Return
HMRC are moving towards quarterly submissions to report personal income that is not subject to PAYE. It is being phased in starting with self-employment income and rental income of over £85,000 for the 2018 tax year and £10,000 for the 2019 tax year. What is not clear as yet is when the requirement to report dividend income from your limited company will be required. For now, a self assessment tax return is due by the end of January following the tax year. We can prepare this for you or, if you have been doing it yourself and you’re happy to continue, the next few tax returns will be as you are used to doing.
Making Tax Digital for Companies
HMRC is rolling out its requirements for reporting details of personal income from 2018. From April 2019 all VAT registered limited companies will have to comply and all other limited companies will have to comply by April 2020. It’ll be here quicker than you think so it’s as well to start getting ready.