Registering as a Limited company?

JWIOW · 13 January 2015 at 10:14PM

Hi all,

I soon intend to launch a website, and as such am looking to register as a Limited company.
I have spoken to an accountant, who has said they charge £300 (Edit: £400) for the full set up and documentation to be dealt with by them, this includes being registered for corporation tax, PAYE etc.

I've then seen agencies specifically for this kind of service online, the main one seems to be 'Rapid Formations' and for the exact same service - they are asking for £93.39 inc. VAT?

My main questions really:
Is there any difference, or is it just a way of getting more money out of start-up businesses?
Plus, is this the correct way about it or would it be just as easy to do this myself? I think I would rather not have the hassle of the paperwork, the online offer is seeming more attractive at the moment.

Collabora · 13 January 2015 at 10:22PM

http://www.companiesmadesimple.com/ from £16.99
http://www.blueskyformations.co.uk/ from £12.99

all these offer the same service and some with cashback,

zax47 · 13 January 2015 at 10:44PM

Collabora wrote: »

http://www.companiesmadesimple.com/ from £16.99
http://www.blueskyformations.co.uk/ from £12.99

all these offer the same service and some with cashback,

I've used the first of these several times now - easy peasy and great value.

JWIOW · 13 January 2015 at 10:48PM

Thank you both! I think the first link of the above looks well recommended from reading online. Is the VAT registration service at £44.99 worthwhile?

Collabora · 13 January 2015 at 10:50PM

yes i have 3 from CMS if you chose printed seals etc, then this puts up the price with all these, but if you just starting out you just need a simple setup. also think £16.99 then open a bank account through their link and get £50 cash back so you are up by £33

Savvy_Sue · 13 January 2015 at 11:37PM

JWIOW wrote: »

Thank you both! I think the first link of the above looks well recommended from reading online. Is the VAT registration service at £44.99 worthwhile?

Do you need to register for VAT already?

Pennywise · 14 January 2015 at 9:42AM

For a start I do think £300/£400 from the accountant is on the expensive side for a simple setup, but you have to check exactly what you are getting. I'd like to think any accountant would spend a fair amount of time with you going through all the pros and cons, i.e. the benefits and disadvantages of incorporation, whether or not you should be VAT registered and if so, the various schemes available, going through the rights, responsibilities of directors and shareholders etc., explaining how the company would work, paying yourself, wages, dividends, expenses, etc. If the accountant is going through all that, and then doing the formation and registrations, then a couple of hundred pounds is reasonable.

A formation agent will do the bare minimum of just the formation, which to be honest, you can easily do yourself these days directly with Co House - either way you'd have to do a bit of research. Most co formation firms are "execution only" so you wouldn't expect any personal advice if you're only paying £20-£50 - many will have factsheets and FAQs on their website, but like I say, that's not much difference from the Co House website.

So, basically, you're comparing apples and pears. Even using a formation agent will be do-it-yourself, especially around tax registrations, so expect to spend a few hours doing research to make sure you know all the ins and outs and options and get the right setup. Engaging an accountant to do will inevitably cost a lot more, but if you choose the right one and make sure you know what you're getting, you're buying piece of mind that it'll be done properly and you won't be making any mistakes in the process. Like most things these days, it's up to you. Would you service your own car or take it to a garage? Would you decorate your lounge or get a decorator in? Would you fix up a new security light or get an electrician? It's exactly the same. But please don't be mistaken in thinking that a cheap formation agent will do the comprehensive full advice service of a decent accountant.

It always makes me laugh when I get new clients signing up and don't take me up on my offer of doing the formation and registrations for them, and opt to do it themselves. In one case, I'd offered to do a VAT registration application for £30, which the client thought she could do herself, which is fair enough. It took her a full day, and she kept having to phone and email me, right from the basics of just getting to the application screen on the HMRC website as she'd already screwed up the basic GovtGateway registration/login, then when she did finally get to the VAT application itself, she was phoning/emailing virtually question by question as she couldn't make any sense out of it. Of course, that took me even more time than if I'd just done it myself, so she ended up paying more for my time and losing a day of her life! I'd reminded her of my offer to do it for her after the first couple of phone calls but she was adament she wanted to do it herself "to learn about it", but of course, it's something you only ever do once so pointless!