What is bookkeeping?
Bookkeeping is the process of recording and categorising your business income and expenditure.
Do I need a bookkeeper?
Maintaining your books whilst running your business can become a very time consuming task. A good bookkeeper can manage your accounting systems and produce for you vital decision making information. By hiring a bookkeeper, you can rely on their expertise of accounting and expect that accounting policies are adhered to.
Bookkeeping can be done by business owners themselves if they are confident enough to do so, however it would not be recommended without any training.
Should I outsource my accounts or hire a bookkeeper?
Hiring a bookkeeper gives you the added responsibility of being an employer, you need to produce payslips every month and need to find cover when the employee is away or sick. By outsourcing your accounts you rely on the firm’s team and expertise, reducing the chances of errors occurring.
Should I invest in accountancy software?
Investing in accountancy software such as Sage, QuickBooks or Kash flow can be useful if you have had the right training. However accounting software can be expensive but when employing a firm this will be a burden off of your shoulders as they will have the required software.
What do bookkeepers generally charge?
Experienced bookkeepers tend to range between £10 – £25 per hour. However when outsourcing your accounts, there are firms who charge fixed fees for the work carried out and can give you a quote before you employ them.
What is the difference between a limited company and self employment?
Being self employed means working for yourself. You invoice your clients and they pay you directly. You must account for your own national insurance and tax and submit a tax return every year.
A limited company is a separate legal entity which is run and controlled by the director(s). The director is given the responsibility of carrying out the day-to-day transactions of the company and accounting for what takes place.
When do I have to register as self employed?
When you are actively seeking work other than employment, you must register as self employed. By not doing so in time, HMRC can fine you for late registration.
What is the deadline for submitting my tax return?
When filing paper returns the deadline is the 31st October and when filing returns online the deadline is the 31 January.
What is corporation tax?
Corporation tax is a tax which is payable by limited companies on their profits. For businesses making a profit of £300,000 or less, the current rate of tax is 20%.
When do I have to pay corporation tax?
Companies generally need to pay their corporation tax nine months after the company’s year ends.
When do I need to register for VAT?
You will need to register for VAT if you are in business and in the last 12 months, you have taken in £81,000 worth of income or expect to reach that amount within the next 30 days.
When do I register as an employer?
Generally you will need to register as an employer when someone starts working for you.