Accounting and Taxation Services for Contractors and Freelancers

AA Accountants UK provides a total accountancy service to support contractors including company registration, bookkeeping services, payroll services and online accounting services.  We are the complete contractor accountants.

Why be a contractor?

Have you thought about becoming a contractor?  Think about this:

  • An average contractor can easily earn twice as much as a full time employee doing the same work. Most contractors who leave permanent and go contracting earn more than if they’d stayed in the permanent world. They are paid these high rates because of:
    • Their skills,
    • The flexible nature of their work relationships, and
    • The fact that many of their contracts are short term.
  • Contracting through your own limited company is very tax efficient. It isn’t as hard or time consuming as you might think. We can show you how.  The Tax planning opportunities for a contractor are very attractive and can increase your take-home pay.  You can, for example:
    • Reduce your tax bill by offsetting your business expenses against your income;
    • Adopt a flat rate VAT scheme, which can generate substantial savings;
  • You have much greater freedom to pursue you ambitions.
    • You choose where, when and with whom you work;
    • You can change contracts more easily than change jobs;
    • You are responsible to clients, not to a boss.  This can mean that people see you in a different light and you feel differently about yourself; and
    • You take control of the way your career develops.
  • You will be able to work in a stimulating and changing environment:
    • You will gain a unique range of skills by working in different roles and environments;
    • In time, you will become an ‘industry expert’ because of the skills and experience you acquire. This makes you more competitive in the market place;
    • Your experience in different work environments gives you exposure to different cultures, structure and organisations that add to your value;
    • You can negotiate your pay and conditions; and
    • With your added freedom, opportunities aboard become much easier. The opportunities for contractors around the world are vast as you become more attractive to clients because of your broader skill set and experience.

Contracting risks:

Every decision has its pluses and minuses. Contracting comes with risks and challenges, for example:

  • You have to go and get you own jobs and generate your own income;
  • You are responsible for all the statutory returns and red tape.  Here AA Accountants UK can be help.  We can maintain your records and prepare your returns for you.  We have a special price for contractors of £75 a month that will see to it all;
  • You do not have entitlements to paid holidays or sick leave.  You have to make your own arrangements for them; and
  • The need to adequately insure yourself against a wide range of contingencies.  Here again, we can advise you of what is prudent in your circumstances.

IR35, what does it mean for you?

If HMRC considers that you do not carry the appropriate level of risk, that is, you do not have the appropriate level of responsibility, liability and control, then according to IR35 (the relevant section of the taxation law) it will treat you as a simple employee. This means that you will be liable for full tax and full National Insurance (instead of the usual salary and dividends from the profits of your company). Some other deductions would not be available to you either.  In short, you earn less money!

What are the options if caught by IR35?

If an examination of your contract and work practices shows that you are caught by IR35, it could still be in your financial interest to continue as a contractor.  You would still be entitled to:

  • Claim for travelling and accommodation expenses,
  • Claim for 5% of your turnover,
  • Benefit from the VAT flat rate scheme providing savings up to ₤2,000 a year,
  • Receive interest on the funds held within your own company
  • Put any other contract work through your company.

Please contact us if you would like a free consultation to discuss the tax advantages of contracting in more detail and the different possible scenarios.

At AA Accountants UK, we offer an all inclusive service for contractors including:

  • Company formation, including company registration;
  • A full accountancy service including preparation of:
    • Annual Accounts;
    • Company tax returns;
    • Personal Tax Returns;
  • Company secretarial service;
  • Book-keeping;
  • Taxation services including:
    • VAT Returns;
    • PAYE Returns;
    • Tax computations;
  • IR35 support including:
    • Review of contracts for IR35 status;
    • Provision of anti IR35 draft contracts;
    • Dealing with IR35 disputes.

Special Rates for Contractors are £75 per month.

Don't forget to let us know if you'd like more information about any of our services. AA Accountants UK is your reliable, friendly, trustworthy accounting firm providing a full range of accounting services, including bookkeeping services, online accounting and payroll services.

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