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Starting your new career as a contractor or investing in the accounting and tax services you need for an existing contractor business? Look no further than Tax Bite, one of the UK’s leading accountants for contractors and general accountants firms with services and packages designed with any limited company, contractors and freelancers, in mind.
There are many jobs and professions where you need the support and expertise of highly trained accountants, and the world of contractors is no different. At Tax Bite, we have many years’ worth of experience providing highly specialised accountancy services for contractors. Technology-led, our services and the software we use to achieve them are designed to take the hassle and fuss out of accounting in such a complicated sector.
We all feel the same here and don’t want accounting to be confusing or intimidating, as crucial and pertinent it is to the success of your contractor business, we try to demystify the accountancy sector and avoid using jargon where possible so that all who work with us can understand plainly and quickly what they are getting from us. There are no extortionate rates either or that so-called dedicated personal accountant that other firms and individuals claim to be.
We can help you with whatever accountancy needs you have, whether you are looking to incorporate your contractor business into a limited company or want to maximise the tax-0efficiency of your business. If you are looking to try and understand better the rules and legalities surrounding IR35, we can do it all and more.
No two accountants for contractors, even within the same general industry, are ever truly the same. As a result, we always offer flexible accounting solutions to contactors that can be easily tailored to meet the specific needs of your business.
Before we go any further discussing the contractor accountancy services, we offer here at Tax Bite, we thought it would be worthwhile to outline exactly what we mean by the term contractor. A contractor is either a firm or individual that carries out work as outlined in a contract where they provide the labour and/or materials necessary to do a job or perform a service.
Contractors are free from the usual fixed requirements and expectations of a traditional employment contract, but the work they carry out and the projects they complete are normally securer and are longer than those undertaken by freelancers.
If you are a contractor, it is important to understand that all business dealings are your responsibility, and you should be in full control of when and how you do the work required by your clients.
If you have yet to make the leap and start working as a contractor, you may wonder why people do it in the first place. When you operate as a contractor you have a certain degree of freedom when it comes to picking and choosing the clients you want to work for, and the specific jobs and projects you want to take on.
As a contractor, you have the benefit of the “Mutuality of Obligation”. This essentially means that as a contractor you do not have any obligation to accept any contract offered to you. Another key benefit over other forms of employment and business operations is that contractors are free to choose where and when they carry out their work. In general, though, you will that most contractors are expected to spend some time working from the office of their clients.
In addition to all the traditional accounting services you likely expect a company of our stature to provide, we can also provide a personal service as expert accountants for contractors and freelancers. This gives you access to a dedicated accountant that can provide tailored and specific financial help and accounting support. There are 4 categories that our services are divided up into:
If you are just starting as a contractor, it can be a very intimidating and challenging experience, especially if you are looking into registering your own limited company. At Tax Bite, we are here to help and will provide you with your own dedicated contractor accountant who can help you make the right decisions in the formative stages of your new business.
If you decide you want to start a contracting business, there are a lot of things you need to consider. This includes things like whether you should become a limited company or if an Umbrella business model would be a better fit for your enterprise, alongside more obvious decisions about banking and insurance. In the past, we have helped hundreds and hundreds of contractors set up their businesses and have continued to support them. We can do the same thing for your contractor business.
The contractor accounting packages we offer are all-inclusive and you will receive the same standard of service from a senior-level accountancy specialist.
For more information about our new contractors’ services, please get in contact with the team here at Tax Bite today.
What if you are already receiving contractor accountancy services, but are not 100% satisfied with the work they are doing? Perhaps you are looking for a better value service at a more affordable rate. Whatever the reason, switching accountants is often harder than it needs to be, because the average contractor is not aware of the ins and outs of the sector.
At Tax Bite, we can help you. Rather than waiting until the end of the tax and financial year, why not get in contact with one of our team today.
As we have already noted, there are a variety of reasons why you may be looking to switch contractor accountants. One of the most common we have come across over the years is other firms and individuals not offering a dedicated point of access or contact to clients. That’s not the case here at Tax Bite. When we are hired as your contractor accountancy firm, you will be assigned your own dedicated accountant who will be able to give the support and advice you need.
One aspect of offering your services as a contractor that you can’t afford to, either legally or financially, cut corners or avoid is purchasing insurance. Most clients require that their contractors have adequate insurance coverage, not just for themselves but for all parties involved.
Don’t try to skip on insurance for your contractor services. Aside from the legalities, there are other great reasons why you should invest in insurance, including:
The truth is that most clients are unlikely to sign on the dotted line of your contracts unless you have business insurance. Having all the appropriate business insurance is what may give you the edge on prospective clients.
When you have insurance, it is often seen as a self-employed indicator, particularly if you are working outside the regulations of IR35, as it highlights to HMRC and your client that you are in business on your own, separate account.
When you make mistakes while doing contracted work for a client, if it costs them financially, they may choose to claim against your limited company. Whether this is because of a technical error, an accident that damaged hardware or advice that was not ideal, having insurance in place can cover for those costly mistakes.
All businesses, big and small have the ever-present risk that they will have to undergo tax investigations from HMRC and Companies House. Although these are normally nothing to worry about and just routine, as rules surrounding IR35 are gradually changing and have confused many business owners over the years, some contracts worry that past contracts they had will be investigated and be found to be inside IR35 retrospectively.
You will have undoubtedly noticed there are a variety of kinds of insurance available that are designed to provide coverage for different things. Although it will depend on the type of work you do as a contractor, the following types of insurance are considered the best available for individuals and businesses in your profession.
Employer’s Liability insurance is designed to cover business owners and contractors against claims made by employees. Okay, so if you run a small contractor business, those employees that would normally be covered will likely be you and perhaps your spouse and other relatives or friends, so claims are not likely. Many end clients or agencies, though, still insist on contractors having this form of insurance.
This form of insurance is designed to protect your contractor business when clients claim there were issues with your work. It protects against the cost of paying compensation to settle a claim or correct errors and will also cover legal defence costs.
This is an important insurance to have, especially when you are providing professional services or advice that could be challenged if it does not produce the results your clients expect.
Public Liability Insurance is designed to provide cover for your business as a contractor if the property is damaged or someone is injured, due to the actions you have taken while carrying out contractor work for your client. For example, an expensive IT component drops while you are moving it.
This insurance is there to protect you against the cost of claims from any third parties, in the form of legal costs and compensation pay-outs.
According to the new IR35 rules that are in place, HMRC can determine if a contract that is supposedly undergone by a self-employed individual or contractor is “disguised employment”. They do this by checking it against various criteria, such as employment status, court rulings and precedents that have already been set. You will face fines and will be expected to pay back any tax you owe if you are determined to be retrospectively inside IR35 rules and regulations.
When you invest in Fee Protection cover, you are protected from any hidden costs generated by HMRC enquiries, including those into IR35 cases.
If you would like more information about the business insurance advice and support, we can provide here at Tax Bite, please don’t hesitate to get in contact with one of our team today.
There are times when the right decision for you and your company may be to contact an employee of what is known as an umbrella company rather than setting up a limited company. However, thanks to the rule changes set out in IR35, you may have concerns about whether you will fall inside or outside it. It may even be that one or more of your clients have decided that your contract will be inside IR35.
To make it easier to switch your employment status and your company’s status, we offer an umbrella switching service that will allow you to make the change quickly and with as little hassle as possible.
Perhaps you are just new to the business and the different statuses of companies and are not familiar with the term “umbrella company”. To help you understand it better when you choose to be paid for your contractor assignments through an umbrella company, you become an employee of that company.
This means you will submit your timesheets that show how many hours you worked and the business expenses that were generated.
Your umbrella company then issues an invoice to the agency representing you and provides a payroll service, processes admin, and pays your salary.
A payslip is generated, and your earnings will be transferred into your bank account, with the National Insurance contributions and PAYE tax is taken off, as per normal wages.
If you are somewhat on the fence about whether it’s a good thing or not to change your limited company or current business to an umbrella company setup, you should consider the benefits. Perhaps the biggest and most attractive is that it offers you the chance to enjoy having a contracting business without all the stress and hassle of the associated admin and paperwork.
All administration work, paperwork and official documentation will be handled by our team on your behalf. The only thing you will need to handle yourself is the filling out and submitting of your timesheet. Your umbrella company will take care of national insurance contributions and tax calculations and pay HMRC on your behalf. In addition, the umbrella company can provide you with advice about the expenses you can claim back to maximise the income you make while staying on the right side of the law and HMRC.
Finally, another great benefit is you will get many of the same employment rights that you had when you worked in a permanent role, such as maternity pay, holiday pay and sick pay.
One subject all new contractors want to know is about IR35, but what is it? It is an incredibly important piece of legislation that has a huge impact on contractors and their careers. Although it can seem intimidating and worrying, the IR35 is set to make it easier to determine whether your employment and engagement terms make you self-employed or an employee. The legislation was first introduced in 2000 to reduce and eliminate individuals who were trying to use loopholes and tax avoidance schemes to make their tax situations better.
Then, in 2017, changes were applied to the legislation that shifted the liability and responsibility of establishing IR35 of a contract. It shifted from the contractor to the organisation or client that a contractor is providing work for, also referred to as the end hirer.
If you would like more information about our umbrella company switching services, IR35 legislation and anything else related, don’t hesitate to contact the team here at Tax Bite today. One of our skilled and certified accounting experts will be happy to answer your questions and provide you with advice.
When you choose to contract through your limited company you have less hassle and greater earnings than would have been possible with permanent employment. One of the downsides to this is that you don’t automatically have the financial benefits you get when you are employed, like life insurance, health insurance, and a pension. You will also find it a lot trickier to plan your investments and savings and when you want to secure a mortgage.
Don’t worry though, when you decide to align yourself with Tax Bite, you get full access to a qualified, experienced and dedicated accountant who can offer financial advice as part of our other services. We will help you to choose the best partners to provide a protective financial barrier for you and your limited company to ensure you are fully protected against whatever may happen in the future while maximising your potential earnings.
Although there is a multitude of different financial services and pieces of advice and recommendations that contractors may need, depending on their industry, the most vital and common fall into the following categories:
We can help you with everything.
When trying to determine which contractor accountancy firm you intend to use, the monthly costs are something you should give a lot of thought to. Rather than using the type of firms that charge a turnover percentage as their fee, contractors tend to use those that charge a monthly fee. There is no set fee charged by all accountants and therefore the price you pay for their services can vary from one agency and individual to another. At Tax Bite, we will discuss your needs and requirements and determine a fair price.
While we can’t offer a monetary figure, you can expect to pay between £69 and £120.
Like many things these days, most accountancy firms offer their accounting and tax services online. Although this makes it more convenient for all involved, if you want to secure the best deal and best services with the best contractor accounting firm, it is still recommended you arrange a face-to-face. Now, we all know that since the pandemic and various lockdowns and other restrictions, there are many alternatives to traditional face-to-face meetings. If your prospective accountant does not want to meet face to face, therefore, you could always arrange for a meeting via Zoom, Skype, or another similar platform.
Meeting face to face, in person or digitally, will help you to make sure they are who they said they are and if there is one relationship that requires trust from the get-go it is that one between a client and their own dedicated accountant.
There is no wrong answer to this question. However, in a perfect situation, you would hire a contractor accountant when you start working as a contractor. Even if that’s not possible, you could hire an accountant the next time you are taken on as a contractor. There are two good reasons why you should engage the services of specialist contractor accountants from the get-go, they will make the whole set-up process run more smoothly and will be able to advise you on the tax obligations you have.
There are many different types of accountants out there, so you may reason that you could hire any of them to serve your contractor business. However, the benefit of hiring an accountant that has specific training and expertise in dealing with contractors who understand how a contractor business should be managed and the best, legally and tax-efficient way to structure a limited company’s capital.
Contractor accountants can offer proactive tax planning and qualified advice that is specifically tailored to your company and circumstances.
Although we recommend that you should contact a fully qualified and experienced contractor accountant here at Tax Bite for full details, we have included the most common expenses you can claim as a contractor:
Everything is moving to be on the cloud and it’s part of the whole making tax digital scheme. The main way cloud online accounting software can help you in your role as a contractor is because it is online and accessed via an online portal. It is much easier to manage even the most complicated accounts books. You can do everything from checking and using your management systems to managing current stock systems, core financial data and cash flow, all from the same place.
What’s more, cloud-based software can be made accessible to whoever needs to use it, while blocking out unwanted individuals. Online accounting software
Construction accounting is often referred to by the term project accounting and follows the basic outline of all costs being collected and reported on for specific contracts. Different activities are set up within the system for each construction project and the costs are attributed and collated for projects as and when they occur.
Our team at TaxBite help various sectors in accounting, such as: