Any accountants out there or self employeed, LTD directors

[Hybrids]

In need of some help please! I'm very new to this, please be kind

Right I'm after some information about employee income tax and national insurance contributions.

I have my own limited company and I'm the only person employed. Its been trading since July 16th 2007.

At first I decided to pay myself below the monthly taxable amount of £435.42 (2007-2008 fin year) thus being exempt from paying income tax and staying above the low earnings for national insurance (£90 per week) so I can get my stamp automatically paid. After speaking to a few people they have advised me to pay myself just above the taxable amount because it apparently keeps the tax man from looking at my account (not that I have anything to hide just saves the hassle and my nerves).

What I would like to know is when I should pay my contributions for financial year 2007-2008? Have I missed any important deadlines? Or are all my contribtions settled after I complete my Tax returns(oct/jan)? I have recieved letters from the inland revenue about contributions in the past but I declared that no payments will be made. Now I would like to pay for financial year 2007-2008. I have already calculated all my income tax and national insurance.

If someone has a general list of important dates and deadlines throughout the financial year that could help me I would be greatful if you posted it below,

Any help and advise is welcomed,

Thanks in advance for any help!

Hybrids

 

[Jambo]

Why have you not got an accountant? To run a trading limited company with no experience of accounting and no accountant is madness.

 

[AdamSee]

I believe you have to file a return every April, which you should have done (even if it's a null return). But you get a bit of leeway in the first year. I'm a ltd company director and it's a pain dealing with all the accounting crap. Best to hire a professional (cost you approx £1200-1700/year), there's more regulations to follow as a limited company. Especially if you're starting to reach the VAT chargeable bracket if you haven't already.

 

[JohnnyG]

If you're doing Self Assessment which I assume you are then you don't need to submit 07/08s figures until 31st Jan 09 (online) and the balance will become due then, you will also have to pay 1/2 the years tax on account for the 08/09 period at the same time which they estimate will be the same amount as 07/08.
Something like this:

Tax due for 07/08 = £10000, payable on 31st Jan 09
Tax estimated for 08/09 = £10000, £5000 due 31st Jan 09 & £5000 due 31st July 09.
Total due 31st Jan 09 = £15000
Total due 31st July 09 = £5000

If your taxable earnings are subsequently less than estimated in the 08/09 period you get credited it

 

[Hybrids]

Why have you not got an accountant? To run a trading limited company with no experience of accounting and no accountant is madness.

I did have an accounted right at the start, I kept emailing and asking questions but kept getting no response, then one day had an email back saying she could not deal with my accounts as she's too busy. I got another only to be let down in the same way

I believe you have to file a return every April, which you should have done (even if it's a null return). But you get a bit of leeway in the first year. I'm a ltd company director and it's a pain dealing with all the accounting crap. Best to hire a professional (cost you approx £1200-1700/year), there's more regulations to follow as a limited company. Especially if you're starting to reach the VAT chargeable bracket if you haven't already.

I don't understand why you must file a return every april then a few months after april file another for the whole financial year, something I should look into. I should contact my local tax office. As mentioned above I've been let down a few times by accountants, but I will definitely look into it. Thanks for your response,

If you're doing Self Assessment which I assume you are then you don't need to submit 07/08s figures until 31st Jan 09 (online) and the balance will become due then, you will also have to pay 1/2 the years tax on account for the 08/09 period at the same time which they estimate will be the same amount as 07/08.
Something like this:

Tax due for 07/08 = £10000, payable on 31st Jan 09
Tax estimated for 08/09 = £10000, £5000 due 31st Jan 09 & £5000 due 31st July 09.
Total due 31st Jan 09 = £15000
Total due 31st July 09 = £5000

If your taxable earnings are subsequently less than estimated in the 08/09 period you get credited it

I have my tax return/self assessment forms they all state the same as you have above, but I have also seen information that AdamSee talks about, this stuff is slightly confusing!

Thanks for all your responses, I'll do some more research, see if I can understand this better.

Any more comments are welcome!

Thanks again,

Hybrids

 

[Paul11]

I did have an accounted right at the start, I kept emailing and asking questions but kept getting no response, then one day had an email back saying she could not deal with my accounts as she's too busy. I got another only to be let down in the same way

surely you would just keep going until you found an accountant you were happy with.. to say i tried 2 and they were both useless so i gave up is a bit crazy.

 

[csmager]

AdamSee is talking about your PAYE administration for the Ltd company. You also have a Corporation Tax return to file, and you're obliged to file your annual accounts with Companies House 10 months after your year end.

JohnnyG is talking about your Self-Assessment Tax Return.

You'll most probably be doing both. And you'd most definitely need an accountant to help you out with the Ltd company filings if you don't know what you're doing.

 

[Hybrids]

AdamSee is talking about your PAYE administration for the Ltd company. You also have a Corporation Tax return to file, and you're obliged to file your annual accounts with Companies House 10 months after your year end.

JohnnyG is talking about your Self-Assessment Tax Return.

You'll most probably be doing both. And you'd most definitely need an accountant to help you out with the Ltd company filings if you don't know what you're doing.

I was aware of corporation tax and self assesment but not the PAYE, from what I've read online the self assessment must be completed (paper) by october and the corporation tax is next year.

The only thing that concerns me is the PAYE administration, just done some research its also called "Employers Annual Returns" (P14s and P35) which were due 19th of May. This can be filed online and contains deductions from employees wages (NI & Income Tax etc),

Think its time I ring the local tax office,

Thanks again for the information,

Hybrids

 

[Morba]

I use SJD accountants. I have no need to chase them for anything, they chase me! Much better that way than me needing to chase them for stuff.

as an example, its the end of Q1, I have had a text and an email to ask me for my quarterly account spreadsheet already.

Very much worth every penny I am paying them.

 

[Hybrids]

Just an update, I phoned the local tax office and employers helpline, they told me every month I'm late with my employers annual returns I will get fined £100. This can be completed online, I've signed up and now waiting for my activation pin through the post, as mentioned above I've already calculated all my NI and Income tax so hopefully get this all completed by next week. On a plus side you get £100 for using the online method to submit your employers annual return.

If i'm able to get through this first financial year without using an account I probably won't look for one in the near future, I'm only a one person company earning just enough to live comfortably, paying 500+ a year for an accountant might not be worth it,

Thanks again for all the information and your comments,

Thanks again,

Hybrids

 

[csmager]

Glad you got somewhere!

You will need to prepare a set of accounts to send to Companies House after your financial year end, and you will need to prepare a Corporation Tax return (and supporting computation). This could be slightly daunting if you don't know what you're doing.

 

[Jambo]

If i'm able to get through this first financial year without using an account I probably won't look for one in the near future, I'm only a one person company earning just enough to live comfortably, paying 500+ a year for an accountant might not be worth it,

An accountant is likley to save you more than 500+ a year. For your info, most qualified book keepers use an accountant to complete Limited Company accounts. Even for a one person company. Some book keepers don't do Limited Company accounts at all.

With respect, there is a good chance you will make a mess of this and it will cost you a lot more to get an accountant to fix it.

 

[Morba]

Indeed, im paying somewhere around £120 a month for my accountant, they will be saving me much more than that over the year :]

 

[Hybrids]

Glad you got somewhere!

You will need to prepare a set of accounts to send to Companies House after your financial year end, and you will need to prepare a Corporation Tax return (and supporting computation). This could be slightly daunting if you don't know what you're doing.

Yes I need to send companies house a copy of my accounts for 2007-2008, this can be uploaded on the companies house website, its all slightly daunting corporation tax is still awhile away

An accountant is likley to save you more than 500+ a year. For your info, most qualified book keepers use an accountant to complete Limited Company accounts. Even for a one person company. Some book keepers don't do Limited Company accounts at all.

With respect, there is a good chance you will make a mess of this and it will cost you a lot more to get an accountant to fix it.

Perhaps it might save me money, I have been given a CD from HMRC that calculates my wages/contributions/tax deductible expenses/corporation tax. So hopefully I won't make a big mess, the software checks through your returns for errors and inconsistencies, once I've entered my figures the software will complete the rest and submit online. The only thing an accountant can do is help me claim more tax deductibles like petrol allowances etc.. I'm not sure an accountant can save me much more let alone 500+ as i'm claiming quite a few expenses against the company, but of course if I did have an accountant I wouldn't be in the mess I'm in now

Thanks again for all the replies,

Hybrids

 

[Hagel]

I have been given a CD from HMRC that calculates my wages/contributions/tax deductible expenses/corporation tax.

If its the CD that I'm thinking (Employer CD-ROM2008) of then it will only calculate PAYE deductions NOT tax deductable expenses or Corporation Tax.

I would seriously urge you to find an accountant to prepare your accounts and give you some advice on how to run the financial affairs of your company. The advice isn't just about tax deductable expenses, they also offer a whole host of advice on the best way to pay your salary/draw dividends/VAT/manage company assets/ensure that Tax Office deadlines are met etc. As others have mentioned, a good accountant does not need to be expensive and you will find that the benefit, peace of mind and money saved by using one will far outweigh the costs involved.

If you have had bad experiences with your original accountants then seek out some recommendations from people who use an accountant. Discuss your requirements with them and then ask them for a Terms of Engagement which will clearly explain what you have appointed them to do.