Amazing accountants got to where they are now not through mystical means or because it’s their destiny, but by working hard to learn the ins and outs of business and finance. That means they’re often seen as fonts of wisdom – and they are! You may have a hundred burning questions to ask your accountant, but when you’re starting out you should think about getting the answers to these four first:
Am I Charging Enough?
When you read that question, you may have thought ‘what would my accountant know about my business/industry/sector/clients that could help me decide?’ It goes without saying that your accountant probably doesn’t know your niche as well as you do, but the business processes that work under the surface are very much something accountants know about. When you’re unsure about whether or not you’re charging enough, your accountant can assist in you in marking up how much your time is worth versus the costs incurred in your business to assist you in the search for a perfect figure. On top of that, they’ll also be able to objectively advise you when it’s time to up that figure.
Do I Need to Register for VAT?
After seeing invoices and small print talking about VAT, you may wonder if you should join the bandwagon and also charge VAT. This is a great question to ask your accountant as each circumstance is different. For example, registering for the flat rate scheme under the threshold can give you great benefits, but how do you broach that with your current clients, all of whom are small businesses? Get some sage advice from your accountant before deciding either way – and they’ll even be able to sort out your registration for you.
What Expenses Can I Claim?
This is another excellent question that you’ve probably been itching to ask since your company formation, but you’ve maybe been too afraid to lodge any expenses just yet. Your circumstances – such as if you’re working for an umbrella company or own your own limited company, or if any of your contracts are caught in the 24 month rule – will determine what you can put on expenses, so it’s a good idea to ask and get some instructions on how exactly to go about it first. This will save you the hassle of lost receipts and incorrect accounts.
How Many Dividends Can I Take?
Being able to withdraw dividends is one of the golden benefits that come with owning a limited company. As a shareholder (probably the only shareholder when you start out), you’ll be able to withdraw a portion of the profits retained by the company – that is, money that’s not saved aside for costs such as tax, wages or other expenditure. The most tax efficient amount, however, differs – so we recommend talking to your accountant before settling on how much you wish to withdraw. It’s best to ask because you don’t want to find yourself at a marked disadvantage further down the line because you took too much too soon!
Have any other burning contractor, freelancer or limited company questions? Get in touch with Gorilla Accounting – company formation and contractor specialists – and ask away!