What exactly can a accountant do for a IT contractor ?

29
Posted 13th Oct
I started a ltd and found a IT contract, for these simple tasks accountant wanted to charge me £60, I am not saying it's not correct, it's just that I don't want to pay something I can do myself within 20 minutes.

Moving forward, what can a accountant really do for me ? I simply not able to understand there role.

Specially when they ask me to pay them by £50 direct debit and they will file my accounts when needed. I may ask the next account this question but I want to hear from you guys before I talk to another one...
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OK. I've retired from IT contracting. Did it for 20 years. Retired under 60.

Look at it this way. You keep asking which suggests you aren't getting the answer you want. 2 reasons spring to mind for that; you don't like the answer or you don't understand the answer. So back to the fact you keep asking the question.

It is perfectly possible to do your accounts yourself once you know what you are doing. But HMRC will make like sickening for you when they see you are doing it yourself and auto assume IR35 applies (even after auto assuming IR35 applies in the first place). You will spend your life dealing with them. Your posts already suggest you are not acquainted with VAT - inc Flat Rate, CT, Company Cartax (the recent changes are very nice to a Ltd) CGT for solvent liquidation in due course.,

Your posts suggest you personally need an accountant because you arent quite there yet from simply googling and reading the pages which tell you what an accountant does for you. Accountants charge min 300 +VAT for a Ltd company return. Then payroll - unless you want to get into trouble later and believe the sane contractors, HMRC are coming for contractors. I paid my Chartred Accountant £1,200 and never ever doubted the value of it. He saved me heaps of tax over the years and kept HMRC under control by letting my claim upto the line but not over it. Dont asssume that someone is Chartred just because they put that word after their name. Many will have gone and done Charly Chongs online Accountancy course and passed with 3% thus enabling them to say they are accountants. They aren't. God advice costs money. If your accountant isnt saving you his fee each and every year, he ain't doing a good job.

You need PI insurance, Employers liability and Employee liability almost certainly. Try Hiscox.

One final point. Read the contract. As in READ IT. Don't skim it. Don't ignore it. Toughen up your liability. Exclude Direction and Control of your work. Don't just have a substitution clause; exercise it.

Register your company yourself. Its easy and costs £10.

If you will turn over £85k or more (and as an IT contractor, it would be pretty amazing if you don't), you need to register for VAT

Remember its different. Your future does not depend on HR. It depends on yoru personal reputation and only once in 20 years did I look for a job. The jobs found me through personal referral.
computer11013/10/2019 09:34

I don't understand why SOME people keep looking at history of my posts, if …I don't understand why SOME people keep looking at history of my posts, if you can help GREAT, if you can't just move on ? isn't it that simple ?


People keep looking at your posts because you are posting about the same thing, how you want to to set yourself up as an IT contractor but at each step you have to ask on here because you don't really know too well what you are doing. Your threads are all linked in that respect. People are trying to help you by suggesting that might need to be a little bit more clued up about what you are wanting to do before you run in to potential problems.
As per all your other threads on similar topics, should you not have asked all these sorts of questions beforehand?

No offence, but I don’t think IT contracting is for you.
computer11013/10/2019 11:36

I don't understand why SOME people on here are can't talk straight ?I …I don't understand why SOME people on here are can't talk straight ?I would had appreciated it more if you had said...Accountants deal with IR35, S.660, capital allowances, balancing charges, allowable expenses, PAYE, pensions, CGT, etc, etc?I give up on this forum already !Thanks to those who helped with a helpful tone not unnecessary criticizing.


You started it.

As a professional you ought to recognise the cost of buying professional services. Look at the tone of your questions.

Why would I need a computer bod to write software - he wants to charge me £££ just to set up a data base/web site. I can install vb....


You're making a massive change to your working life but seem to have done bog all research. Accountants sort out your accounts and use their knowldge of the fiscal and tax systems to ensure that you comply with the law and hopefully maximise your income.

There is a huge body of law around accounting, corporate structures, tax, trading, liability, etc.
29 Comments
As per all your other threads on similar topics, should you not have asked all these sorts of questions beforehand?

No offence, but I don’t think IT contracting is for you.
Babbabooey13/10/2019 09:30

As per all your other threads on similar topics, should you not have asked …As per all your other threads on similar topics, should you not have asked all these sorts of questions beforehand?No offence, but I don’t think IT contracting is for you.


I don't understand why SOME people keep looking at history of my posts, if you can help GREAT, if you can't just move on ? isn't it that simple ?
I want to know what IT contractors really do?
What do your work colleagues do? Can you not ask them?
computer11013/10/2019 09:34

I don't understand why SOME people keep looking at history of my posts, if …I don't understand why SOME people keep looking at history of my posts, if you can help GREAT, if you can't just move on ? isn't it that simple ?


I am helping. I’ve told you that you should have asked all this BEFORE.

Contracting is not for you, it’s that simple.
Gollywood13/10/2019 09:37

I want to know what IT contractors really do?


We develop software's
Babbabooey13/10/2019 09:46

I am helping. I’ve told you that you should have asked all this B …I am helping. I’ve told you that you should have asked all this BEFORE.Contracting is not for you, it’s that simple.


You make no sense atall, you don;t need to be an expert to go out and there and be your own boss, this things come after when you start ramping up business
Gumbon13/10/2019 09:49

You make no sense atall, you don;t need to be an expert to go out and …You make no sense atall, you don;t need to be an expert to go out and there and be your own boss, this things come after when you start ramping up business


Yeah good advice. Quit your stable job with a regular income for something you know nothing about and then ask how it all works. What could possibly go wrong.
OK. I've retired from IT contracting. Did it for 20 years. Retired under 60.

Look at it this way. You keep asking which suggests you aren't getting the answer you want. 2 reasons spring to mind for that; you don't like the answer or you don't understand the answer. So back to the fact you keep asking the question.

It is perfectly possible to do your accounts yourself once you know what you are doing. But HMRC will make like sickening for you when they see you are doing it yourself and auto assume IR35 applies (even after auto assuming IR35 applies in the first place). You will spend your life dealing with them. Your posts already suggest you are not acquainted with VAT - inc Flat Rate, CT, Company Cartax (the recent changes are very nice to a Ltd) CGT for solvent liquidation in due course.,

Your posts suggest you personally need an accountant because you arent quite there yet from simply googling and reading the pages which tell you what an accountant does for you. Accountants charge min 300 +VAT for a Ltd company return. Then payroll - unless you want to get into trouble later and believe the sane contractors, HMRC are coming for contractors. I paid my Chartred Accountant £1,200 and never ever doubted the value of it. He saved me heaps of tax over the years and kept HMRC under control by letting my claim upto the line but not over it. Dont asssume that someone is Chartred just because they put that word after their name. Many will have gone and done Charly Chongs online Accountancy course and passed with 3% thus enabling them to say they are accountants. They aren't. God advice costs money. If your accountant isnt saving you his fee each and every year, he ain't doing a good job.

You need PI insurance, Employers liability and Employee liability almost certainly. Try Hiscox.

One final point. Read the contract. As in READ IT. Don't skim it. Don't ignore it. Toughen up your liability. Exclude Direction and Control of your work. Don't just have a substitution clause; exercise it.

Register your company yourself. Its easy and costs £10.

If you will turn over £85k or more (and as an IT contractor, it would be pretty amazing if you don't), you need to register for VAT

Remember its different. Your future does not depend on HR. It depends on yoru personal reputation and only once in 20 years did I look for a job. The jobs found me through personal referral.
computer11013/10/2019 09:34

I don't understand why SOME people keep looking at history of my posts, if …I don't understand why SOME people keep looking at history of my posts, if you can help GREAT, if you can't just move on ? isn't it that simple ?


People keep looking at your posts because you are posting about the same thing, how you want to to set yourself up as an IT contractor but at each step you have to ask on here because you don't really know too well what you are doing. Your threads are all linked in that respect. People are trying to help you by suggesting that might need to be a little bit more clued up about what you are wanting to do before you run in to potential problems.
£60 for an acct seems pretty cheap . I paid £200+ for fairly simple accounts back in the day. Then moved to an Umbrella company. Saved me quite a bit of money AND a lot of Hassle. Ir35 I never had to deal with thank god. Ask around and try to find an accountant who knows about the IT contracting business
As CCNP said, or, alternatively, stay away from the Ltd Company side and get yourself a decent umbrella company. Sounds like the easier option for yourself.
Babbabooey13/10/2019 09:57

Yeah good advice. Quit your stable job with a regular income for …Yeah good advice. Quit your stable job with a regular income for something you know nothing about and then ask how it all works. What could possibly go wrong.


If he is good at IT then its going to be safe to say he can find enough work to pay his bills, the question is will he get himself in trouble trying to do the legal stuff himself and yes it probs would, but him asking the question does not merit telling him he can't do IT contracting
Gumbon13/10/2019 10:58

If he is good at IT then its going to be safe to say he can find enough …If he is good at IT then its going to be safe to say he can find enough work to pay his bills, the question is will he get himself in trouble trying to do the legal stuff himself and yes it probs would, but him asking the question does not merit telling him he can't do IT contracting


Completely missing the point.

Would you advise people to sign up for something and then expect them to ask loads of questions about how it works? No you wouldn’t. You would hope that before making that leap they would have done all the groundwork beforehand.

Closing the stable after the horse has bolted springs to mind.
Babbabooey13/10/2019 11:04

Completely missing the point. Would you advise people to sign up for …Completely missing the point. Would you advise people to sign up for something and then expect them to ask loads of questions about how it works? No you wouldn’t. You would hope that before making that leap they would have done all the groundwork beforehand. Closing the stable after the horse has bolted springs to mind.


You are making it a big deal for no apparent reason....

Guess I hire a accountant tomorrow, they will get all work done for me... Problem solved ?
You don't understand an accountants role?

So are you saying you do understand IR35, S.660, capital allowances, balancing charges, allowable expenses, PAYE, pensions, CGT, etc, etc?
mas9913/10/2019 11:15

You don't understand an accountants role?So are you saying you do …You don't understand an accountants role?So are you saying you do understand IR35, S.660, capital allowances, balancing charges, allowable expenses, PAYE, pensions, CGT, etc, etc?


I don't understand why SOME people on here are can't talk straight ?

I would had appreciated it more if you had said...

Accountants deal with IR35, S.660, capital allowances, balancing charges, allowable expenses, PAYE, pensions, CGT, etc, etc?

I give up on this forum already !

Thanks to those who helped with a helpful tone not unnecessary criticizing.
computer11013/10/2019 11:36

I don't understand why SOME people on here are can't talk straight ?I …I don't understand why SOME people on here are can't talk straight ?I would had appreciated it more if you had said...Accountants deal with IR35, S.660, capital allowances, balancing charges, allowable expenses, PAYE, pensions, CGT, etc, etc?I give up on this forum already !Thanks to those who helped with a helpful tone not unnecessary criticizing.


You started it.

As a professional you ought to recognise the cost of buying professional services. Look at the tone of your questions.

Why would I need a computer bod to write software - he wants to charge me £££ just to set up a data base/web site. I can install vb....


You're making a massive change to your working life but seem to have done bog all research. Accountants sort out your accounts and use their knowldge of the fiscal and tax systems to ensure that you comply with the law and hopefully maximise your income.

There is a huge body of law around accounting, corporate structures, tax, trading, liability, etc.
You'd want them to do or consider:

Preparation of full accounts under frs1a or frs5 compliant.
Preparation and lodgement of filited accounts.
Preparation of tax comps and ct600 tax return.
Preparation and lodgement of your personal tax return.
Remuneration policy including salary and dividend info and prep.
Ensuring you achieve your state pension credit.
Ir35 and personal tax advice.
Tax advice for the cessation of your company including entrepreneur relief options.
Annual compliance with companies House including cs01.

That would.just be the standard stuff and obviously you can so various yourself if you want.
Edited by: "ibblackberry1" 13th Oct
Will you be vat registered or need to be, will you know how to be making tax digital compliant.

Have you considered a company v personal pension.

Again the above can be discussed with your accountant.
If you think you can do what an accountant does for yourself in 20 minutes then you have no idea what you are doing.

What do you actually do? I can turn a computer off and on again in 1 minute.
Edited by: "CoeK" 13th Oct
If the task can be done by the OP in 20 minutes then £180 per hour for a fully qualified professional seems about right!
ibblackberry113/10/2019 14:02

You'd want them to do or consider:Preparation of full accounts under frs1a …You'd want them to do or consider:Preparation of full accounts under frs1a or frs5 compliant.Preparation and lodgement of filited accounts.Preparation of tax comps and ct600 tax return.Preparation and lodgement of your personal tax return.Remuneration policy including salary and dividend info and prep.Ensuring you achieve your state pension credit.Ir35 and personal tax advice.Tax advice for the cessation of your company including entrepreneur relief options.Annual compliance with companies House including cs01.That would.just be the standard stuff and obviously you can so various yourself if you want.


Thank you, that answers my question nicely
JimboParrot13/10/2019 15:16

If the task can be done by the OP in 20 minutes then £180 per hour for a …If the task can be done by the OP in 20 minutes then £180 per hour for a fully qualified professional seems about right!


I'd charge £300
ibblackberry113/10/2019 14:02

You'd want them to do or consider:Preparation and lodgement of filited …You'd want them to do or consider:Preparation and lodgement of filited accounts


An accountant that fillets the accounts in the right way (nudge nudge) is worth paying for
Accountants might be able to guide you with Tax, expenses, Companies House, directorship, share allocation, office setup, equipment purchases etc. but unless they are familiar with the nuances of IT contracting, they won't be able to offer much assistance on any specific IT questions.

How big is your previous customer base and networking circle as you'll need to make and retain relationships with recruiters etc. How much can you tap into?

Before I made the move I spent ages reading, asking informed questions to whose who contract or have contracted and talking to recuiters to see the 'true' market rates rather than the waffle posted on job sites. I'm in a fortune position as my role is in demand at the moment.

If you're really making the move good luck but you do really seem to be blinded by the numbers. The figures are only as good as your contracts\customers and agents.

If you're a developer are you expecting a lot of smaller contacts or longer 6-12 month gigs? My role I expect 6-12 months as its large scale projects and programmes so I don't have as much worry about continually worrying where work is coming from.
Edited by: "darlodge" 13th Oct
Gollywood13/10/2019 09:37

I want to know what IT contractors really do?


Telling people to reboot the PC!
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