Is a business account for sole trader absolutely necessary?

saver6

Gosh, you're all so helpful! It does make it all seem slightly less of a mountain!

I kind of already started my own spreadsheet earlier today, just to list stuff we've already paid for, cost, VAT, receipt numbers etc, and had already started to categorise things, so it looks like I'm a step ahead of any paper-based system anyway... hmmm, maybe I'll skip the ledger-type book after all and just develop my own system. I do quite a lot of project management looking after budgets etc, so I think I have the basics locked away in my head somewhere.

Oh, and Savvy Sue - registering with HMRC is indeed top of the list, to do tomorrow in fact. After all, the tax man is not one to mess with... For the sake of a quick phone call it's just not worth holding out.

As for tools, hubby has everything he could possibly need already as he's a mechanic by trade and a keen DIYer anyway, so we're all set there, RESULT!

moneypooh

Some banks like Barclays offer other services like free credit reports on your customers and free online back up, and free virus software etc...
Make sure you get the first year free too.

A simple spreadsheet is so simple to use and very accountant friendly

Savvy_Sue

saver6 wrote: »

As for tools, hubby has everything he could possibly need already as he's a mechanic by trade and a keen DIYer anyway, so we're all set there, RESULT!

Suggest he puts his name on all his tools before they leave the house, perhaps Able Labels with his phone no. on too would be worthwhile, then if he leaves anything anywhere people will know it's his!

Pennywise

I'd suggest you go to see an accountant before you get any deeper. Most decent accountants will give you a free initial consultation. Your accountant will probably have their own preferences for how you keep your records - some will give you a free spreadsheet, some will give you either free off-the-shelf software or access to a free online accounting system. If you choose your book-keeping method first, you may find that your accountant either won't work with that system or will charge more because it isn't their preferred system. In our firm, for example, we'd give you either a manual book or a software system free of charge and give you free basic training on how to use it - we do this because in a year's time, we get your records in our preferred format which makes our job easier and quicker! An accountant will also be able to help with lots of other things too if you ask them soon enough. I'm confident in saying that I save our clients more money than I charge them for my fees - I hate it when a client has been trading for a year or more but the first time I see them is when they walk in with a carrier bag full of screwed up paperwork, a spreadsheet completed in a completely useless manner for what I need, or an off the shelf software package like Sage where they havn't entered the transactions properly - they end up paying a lot more for their accounts than they needed to and have missed out on planning opportunities. So, my advice is, get your accountant appointed now - it will save you money in the long term.

saver6

All good points. We'll look into getting an accountant asap. I assume the golden rule of recommendation applies here? And is there anything I need to watch out for? Specialists etc.

thebaldwindowfitter

starting out i would not open a business bank account he could just open another personal account .he will probally get first year business banking free but then he will get charged we have got ours down to a fixed £15 a month we enjoyed free banking for years while my mate was my manager but he left 2 years ago .you also need to speak to job centre see if theres any start up grants some you can get for taking a small course .guy we worked for had got £1100 starting up a wrought iron gate company for attending a 2 day course .inland revenue also do start up packs for new business.also look at getting a website its cheapest form of advertizing after recomendation.when getting an accountant look for a chartered accountant

Pennywise

saver6 wrote: »

All good points. We'll look into getting an accountant asap. I assume the golden rule of recommendation applies here? And is there anything I need to watch out for? Specialists etc.

You don't need any kind of specialist for such a basic/general type of business. Getting a recommendation from friends/family with a similar size of business is the best way. If you can't get a recommendation, then get 2 or 3 freebie initial consultations and go with the one you can relate best to. Don't go for the cheapest, it is false economy - a more expensive accountant that knows the tax loopholes and can give business advice is far better than a cheap one who just crunches the numbers. Also, remember that the word "accountant" isn't protected like solicitors or doctors etc - literally anyone can call themselves an accountant - check for the word "chartered" on their letterheads, website, sign above the door etc. Obviously some "chartereds" are poor, just as some "unqualifieds" are good, but without any recommendation you'll be working blind, so you need to protect yourself as best you can and the "chartered" tag at least gives you some comfort that they are properly qualified, regulated, insured, etc.

sss555s

Abbey and A&L do free business banking.

I used to use RBS and the fees were getting out of hand so it was a godsend when i switched to Abbey.

It's a postal account but really easy (after setting up) as they supply 1st class envelopes for everything and you can view your account and pay bills online.

You can also deposit money in an envelope in the night safe if required but you can't use the branch for any dealings, which isn't really a bad thing

If you can get a good friendly local reasonably priced recommended accountant then they should save as much as they cost in legit ways you never even knew about.

I use a excel spreadsheet i made up myself and it's far quicker than the simplex D book and if you keep your books up to date and tidy you may get an accountant for around £400 mark but prices can vary a lot.

saver6

Well, having asked one of the accountants at my work for a recommendation, she recommended herself! She's chartered and does the same for lots of people in her family, including builders etc, so she knows all the tax claim stuff that's actually relevant to hubby's handman biz. She offered to do it for free as well, and has also said she'd sit down with me this week to show me in spreadsheet form exactly what she needs.

Result!

Then we told a web designer friend of ours about it all last night and he promptly offered to build our website and design a logo for free as well! He's already started it so we're well on our way.

Double result!

Really feels like it's all coming together now. Just need the clients now!