Thinking of becoming a contractor?
If you’re thinking of becoming a contractor, your first step will be to establish a business from which you can sell your skills and get paid. This means choosing an operating structure.
There are two common operating structures typically used by contractors – a Limited Company or Umbrella Company.
When forming your Limited Company, you will need to decide on a Registered Office address. Official documents will be sent to this address such as those sent by HMRC.
You can register your own address, your accountant’s, or sign up for a registered office service.
FAQ: Should I use my personal address?
Some contractors decide to use an address other than their own as this information will be publicly displayed on Companies House. By doing this, it draws a line between your working life and personal life.
Choosing a registered office address can be beneficial if your rental agreement doesn’t allow you to use the landlord’s address as a registered office.
If you decide to use your personal address, but then decide against this in later life, it will be difficult to claw back this information as it will already be in the public domain.
If you use the address of your accountancy firm, this will mean that your accountant will have instant access to your financial documents. This will allow your financial affairs to be dealt with promptly, saving you time and money, rather than posting them separately to your accountant or scanning them over.
An external registered office service can be used for an additional cost.
If you appoint a specialist contractor accountant, they will take care of forming your Limited Company. If you decide to elect the long-term services of an accountant, they will handle your tax affairs for the financial year.
At Gorilla Accounting, as part of our all-inclusive package for just £95 + vat per month, we offer the following:
- Preparation of Self-Assessment Tax Return
- 24/7 access to online accounting software, FreeAgent
- Your own dedicated accountant
- Unlimited support including meetings, emails, telephone and Skype
- Preparation of Company Accounts and Corporation Tax Return
- Preparation & Submission of quarterly VAT Returns
- Preparation of Payroll (for up to 2 employees)
- Customer Service Guarantee
- Complimentary access to SwiftSwitch
Typically, your next steps will be, opening a business bank account and taking out business insurance.
- Professional Indemnity: If you deliver wrong advice or make a mistake, this will cover any legal defence costs you incur and damages awarded against you for the errors made in your work.
- Public Liability: This will cover legal defence costs and compensation if your actions result in damage or injury to a third party, or property.
- Employer’s Liability: This is usually required as part of a contract. This covers your limited company for any employees making a claim against you.
FREE Self Employed Guide
Self Employed Guide
Plan ahead and calculate
your take home pay
We have created an online contractor tax calculator in order to assist you with finding how much you take home per month.
To calculate, simply click on the link below and enter your day rate.