Advice setting up as a limited company

bpk101

Hi —

I recently became freelance (graphic designer) and have set up as a sole trader. A few recruitment agencies however are suggesting I set up as a limited company as some of their clients don't like hiring sole trader freelancers.

I'm interested at looking into this (as i plan to freelance for the next couple of years at least) and would like to find an accountant to help me.

How do i best go about finding a local accountant and / or more info on setting up s a limited company? And are there any potential draw backs of a limited company?

Thanks

DKLS

I asked around for a recommendation for local Accountants on a contractor forum, and they setup the Ltd Co and the business bank account for free.

DomRavioli

You might not need an accountant (they are expensive, and most people can do their own books/tax returns).

https://www.gov.uk/government/organisations/hm-revenue-customs has a whole pile of information on self employment, setting up a company etc.

You may find that the majority of your work once established will be referral or networking based, and as someone who has had a business in a similar industry (I'm a sole trader, not a limited company) I find my clients don't care; we both are protected through contracts.

Concerned75

I was working for someone who suggested I set up as a limited company called Think Accounting. Overall, they offered a good level of service. They are based in Grantham. They took care of everything and it was very straightforward for me. Although, I set mine up based on being able to receive travel allowances working for someone, but I wouldn't think working for yourself would be much different.
Just an option to try?

Concerned75

Sorry, that should have said I set up as a limited company with Think Accounting. I didn't find them expensive for what I needed them for.

bpk101

DomRavioli wrote: »

You may find that the majority of your work once established will be referral or networking based, and as someone who has had a business in a similar industry (I'm a sole trader, not a limited company) I find my clients don't care; we both are protected through contracts.

Direct clients won't mind that's right... It's more the bookings I get when freelancing for other design studios through recruitment agencies that have issues with hiring anyone not set up as a limited company. The other option is to invoice them through an umbrella company but it incurs additional costs and again, they're not particularly keen on it so I'm a bit worried I'm missing out on potential bookings being set up as a sole trader.

Thanks!

ACG

I have an accountant, hes not cheap but I received a letter from the tax man yesterday. I could have spent half an hour on the phone asking them (if you have ever called HMRC, 30 minutes on hold is being optimistic).

Instead I just took a picture emailed him and asked if it was any good? He just said bin it - 60 seconds it took. He has also helped reduce my tax bill, not by the amount he charges but he is worth his weight.

Going limited is only worth it if your income is about £35k plus. That may be a little more now with the tax changes coming in next year.

DKLS

DomRavioli wrote: »

You might not need an accountant (they are expensive, and most people can do their own books/tax returns).

You can, and I can, I have an accountancy qualification albeit a tad outdated, but any decent accountant should be saving you much more than the cost of their fee's.
For me its about the use of my time, is my time better spent generating income and delivering or doing admin?