Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • janesmith
    • By janesmith 15th Mar 18, 5:20 PM
    • 24Posts
    • 6Thanks
    janesmith
    How much admin. involved in running a Ltd Company?
    • #1
    • 15th Mar 18, 5:20 PM
    How much admin. involved in running a Ltd Company? 15th Mar 18 at 5:20 PM
    I am thinking of setting up a new (small) company and was curious to ask how much paperwork and administration was involved every year in running a limited company i.e. registered with Companies House?

    The business won't be very big. It will provide consultancy services to other businesses and should "only" involve about twenty payments going into and another fifteen going out of the business bank account every month.

    I am already fed-up with adminstration in other parts of my life and so am concerned that the amount of red tape will keep me tied to my computer on Sunday evenings forevermore doing this and that!

    HMRC will soon require quarterly filings, as well as the annual paperwork for them, and then there's calculating the income, every single expenditure, all the VAT etc.

    I think for such a small company it'll be more efficient and quicker doing it myself than dealing with an external party - an accountant - all the time.

    Very approximately, how many hours every month or year does all the admin with Companies House, HMRC etc. take? I appreciate it varies from business to business.

    Your advice would be most welcome! Thank you.
Page 2
    • janesmith
    • By janesmith 25th Mar 18, 10:27 PM
    • 24 Posts
    • 6 Thanks
    janesmith
    Thank you for the invaluable advice folks. It's really useful to see what things are like for entrepreneurs in a 'real world' scenario.

    I really like the idea suggested by Vectis of starting out as a Sole Trader and then seeing how it goes. Hopefully being a Sole Trader will be slightly less admin and paperwork.

    The websites of some banks request a copy of your Incorporation Certificate etc. if you are applying to open a business bank account. Are there are good business bank accounts of the larger banks that accept Sole Traders?

    Actually, thinking about it, as business bank accounts incur various charges, it'd be cheaper if I just opened a different personal bank account and then used that for my (low-volume) business transactions. At least then my transactions will be separate from my personal ones, but I won't be paying business banking fees. Is that workable?

    Cheers.
    • Savvy_Sue
    • By Savvy_Sue 25th Mar 18, 10:51 PM
    • 39,027 Posts
    • 35,906 Thanks
    Savvy_Sue
    Actually, thinking about it, as business bank accounts incur various charges, it'd be cheaper if I just opened a different personal bank account and then used that for my (low-volume) business transactions. At least then my transactions will be separate from my personal ones, but I won't be paying business banking fees. Is that workable?
    Originally posted by janesmith
    it's probably workable, although it may be against the T&C of the bank. However, for low volume self-employment as a sole trader, there's an argument which says that it's just like having your salary paid in each month, except that your salary varies.

    Yes, if you're opening an account for a limited company, the bank will want to see proof. But if you go to any bank they will have a 'business' account offering for non-limited companies. Some of them offer a free first year.

    I would definitely agree that a separate account is worthwhile!
    Still knitting!
    Completed: 1 adult cardigan, 3 baby jumpers, 3 shawls, 1 sweat band, 3 pairs baby bootees,
    1 Wise Man Knitivity figure + 1 sheep, 2 pairs socks, 2 hats 2 balaclavas for seamen, 1 balaclava for myself ...
    Current projects: Poppies, mohair cardigan pattern arrived and going strong!
    • FatVonD
    • By FatVonD 25th Mar 18, 11:55 PM
    • 5,120 Posts
    • 20,658 Thanks
    FatVonD
    I've had a personal bank account in the past as a sole trader that was 'name name trading as company name'.
    Make £25 a day in April £0/£750 (March £584, February £602, January £883.66)

    December £361.54, November £322.28, October £288.52, September £374.30, August £223.95, July £71.45, June £251.22, May£119.33, April £236.24, March £106.74, Feb £40.99, Jan £98.54) Total for 2017 - £2,495.10
    • 00ec25
    • By 00ec25 25th Mar 18, 11:57 PM
    • 6,963 Posts
    • 6,649 Thanks
    00ec25
    Actually, thinking about it, as business bank accounts incur various charges, it'd be cheaper if I just opened a different personal bank account and then used that for my (low-volume) business transactions. At least then my transactions will be separate from my personal ones, but I won't be paying business banking fees. Is that workable?

    Cheers.
    Originally posted by janesmith
    have a read of the MSE guide to business bank accounts

    https://www.moneysavingexpert.com/banking/small-business

    however, I would much rather see you opening a separate account (even if it costs you some fees) because it is vital to develop the discipline that the money in the bank is the business', until such time as you need it for personal purposes. That way the discipline comes of drawing money out whilst being conscious of: can the business afford to pay that now? Yes of course you are working to make money, and yes it is your money which you have to have to live on, but at the same time you want the business to be sustainable.

    Also will help if/when you go limited as it is then vital to remember the company money is not yours until you pay it to yourself as a salary and/or dividend. Far too often I see people with massive loan accounts where they have taken money out of a company willy nilly and then protest to me when presented with the s455 tax bill for an unpaid director's loan they "forgot" about
    Last edited by 00ec25; 26-03-2018 at 8:19 AM.
    • fishybusiness
    • By fishybusiness 26th Mar 18, 7:10 AM
    • 1,228 Posts
    • 768 Thanks
    fishybusiness
    Re bank accounts, probably worthwhile having a look at which banks are likely to go the distance in your area.

    They seem to be closing smaller branches at an alarming rate - I started at HSBC, moved due to closure, then Natwest, recently moved again due to closure to Llloyds, who seem to be the 'last bank standing' where I live.
    • Pennywise
    • By Pennywise 26th Mar 18, 10:05 AM
    • 10,490 Posts
    • 19,579 Thanks
    Pennywise
    Re bank accounts, probably worthwhile having a look at which banks are likely to go the distance in your area.

    They seem to be closing smaller branches at an alarming rate - I started at HSBC, moved due to closure, then Natwest, recently moved again due to closure to Llloyds, who seem to be the 'last bank standing' where I live.
    Originally posted by fishybusiness
    Depends if the OP needs a physical bank branch. If there's cash involved, a number of banks now provide for cash to be paid in at a post office. I've had business and personal accounts with Santander for over 20 years but never once have I gone in to any of their branches - I do it all online and pay in any cheques by post by handing over an envelope in a post office.
    • janesmith
    • By janesmith 12th Apr 18, 8:19 PM
    • 24 Posts
    • 6 Thanks
    janesmith
    Depends if the OP needs a physical bank branch. If there's cash involved, a number of banks now provide for cash to be paid in at a post office. I've had business and personal accounts with Santander for over 20 years but never once have I gone in to any of their branches - I do it all online and pay in any cheques by post by handing over an envelope in a post office.
    Originally posted by Pennywise
    Thank you for all the wonderful advice in this thread.

    I very much like using a physical bank branch.

    Can't stand using the Post Office for banking. Long queues, only one or two counters out of five are ever open, and the staff struggle to handle anything beyond the most basic tasks.
    • ThemeOne
    • By ThemeOne 13th Apr 18, 7:51 AM
    • 1,223 Posts
    • 1,029 Thanks
    ThemeOne
    I've had bad experiences with garages - does that mean I should service my own car?

    I've had a bad plumber - should I change my own boiler next time?
    Originally posted by Pennywise
    It depends what you're comfortable with Pennywise, and whether you have the qualifications to stay within the law.

    If you want to get others to do every single thing for you, there are always plenty who will oblige - you could probably even get an electrician to change a light bulb.

    I don't service my own car because I have no idea how to do it, no interest in learning and I don't feel I would have the aptitude. I can't replace my own boiler because I'm not GasSafe registered.

    But doing accounts for a small limited company involves skills such as reading, writing and arithmetic which I managed to master at a young age, and can still miraculously perform. Plus there is no legislation saying I cannot do the work. In addition, the work is broadly within my comfort zone so I am happy to do it, save some money, learn about how company administration works and feel more in control of my own business.

    My main message to the OP is don't assume this work is difficult just because professionals offer to do it for you. It isn't. It may still not be your thing though, but whatever you decide best of luck with your venture.
    • jshm2
    • By jshm2 23rd Apr 18, 1:18 AM
    • 344 Posts
    • 148 Thanks
    jshm2
    Well.. depending on the size of the customer base and how much you're invoicing Quickbooks or Xero would automate a lot of the "admin" involved.
    • moongarden
    • By moongarden 2nd May 18, 7:02 PM
    • 461 Posts
    • 187 Thanks
    moongarden
    There are free accounting apps out there
    Check out Waveapps.com - one of my clients uses it and raves about it. I've tried it out and am thinking of using it for invoicing only
    • lavandergirl
    • By lavandergirl 4th May 18, 3:11 AM
    • 429 Posts
    • 521 Thanks
    lavandergirl
    Check Pandle as it is free.
    Do Something Amazing- Give Blood
    • Pennywise
    • By Pennywise 4th May 18, 8:44 AM
    • 10,490 Posts
    • 19,579 Thanks
    Pennywise
    There is doubt as to whether Wave will be GDPR compliant - early responses from them suggest that they aren't planning on becoming GDPR compliant (in fact, they didn't know anything about it). Whereas most other accounting software are saying they'll be compliant. Wave is, of course, a Canadian firm, so the UK market isn't really high priority for them.
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

131Posts Today

1,546Users online

Martin's Twitter
  • RT @Dora_Haf: @MartinSLewis So many people on here saying they're great until you get your PROPER job. What if Your proper job Is ON zero?

  • RT @hslt88: @MartinSLewis I?m a trustee for a youth charity. We only have a limited pool of funds for flexible youth workers for holiday sc?

  • RT @Dan_i_elle_88: @MartinSLewis Loved working zero hour agency care work. Never out of work and I loved having the flexibility! Only left?

  • Follow Martin