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Accountant for Limited Company
Whether you’ve just started a limited company or have been managing your finances on your own for a while, hiring an accountant for your limited company may be the smartest thing you can do in the early stages of your firm’s growth.
Trying to manage your company’s accounting and tax issues can be time-consuming and frustrating unless you have prior accounting experience – which most people don’t – and it can also distract from the day-to-day operations, which is the last thing you need, especially if you are operating with a limited staff as your limited company begins to grow.
Why Set up a Limited Company?
One of the first things an accountant for limited company can do for you is set up the structure of your new venture. But why should you consider forming a limited company in the first place, especially if doing so might complicate your personal and business finances?
There are a variety of reasons why a business might choose to operate as a limited company. These are some of them:
The Peace of Mind of Limited Liability
In the event of a business failure, the 'limited liability' protection can be very valuable. Because of the 'limited' part of a limited company, you should not be personally accountable for any financial losses incurred by the company in most situations.
This is very different to the situation a sole trader would face in the same scenario, as they could be held liable for the debts of their business to the full extent of their personal assets. To put in simpler terms, forming a limited company will protect things like your house and your car if things go wrong.
Your Business Will Appear More Professional
A limited company can help you project a sense of professionalism, which is vital if you want to establish and grow your firm. While a sole trader may be very good at what they do, many potential clients might still view them as just another freelancer. If you operate as an LLC, you instantly gain the 'business cachet' clients are looking for.
You'll Save Money
You could save money on taxes and National Insurance Contributions (NICs). This is frequently due to the fact that you will receive revenue from the company in the form of both pay and dividends, and dividend income is taxed more favorably than salary because it is not subject to NIC. Furthermore, most corporate tax rates are lower than most individual income tax rates. And who wants to pay more tax than they really need to?
Clients Will Feel More Comfortable Hiring You
Some clients may insist on working through an intermediary, such as a limited company or an umbrella business, in order to save themselves money and potential legal headaches.
There is no PAYE obligation and no employer costs such as Employer NIC when paying a company. They may also be wary of engaging with a sole trader since HMRC may conduct a PAYE investigation and determine that the person should have been classed as an employee. And if they do, the financial and legal fallout could be a big problem.
Clients can protect themselves and their business by using an intermediary (such as a limited company or an umbrella company) between them and the individuals actually performing the work. So even if you are essentially doing the same thing for them as you did as a sole trader, the limited company status will help put their minds at ease.
Why Hire an Accountant For Limited Company?
The majority of limited companies use specialized accountants to a) assist with the company’s initial setup and b) supervise its continuing tax and accounting concerns. But a great accountant for limited company – like those who make up the Pearl Lemon Accountants team – can offer a lot more than that.
What Can a Limited Company Accountant Do for You?
- If you haven’t previously done so, register your limited company with Companies House.
- Take care of your company’s initial tax registration forms, such as Corporation Tax, Value Added Tax, and registering as a ’employer’
- To process your salaries, you’ll need to set up and maintain a payroll system. An accountant for limited company can take care of that time-consuming task for you.
- Preparing your company’s VAT returns on a quarterly basis.
- Bookkeeping
- Forms relating to HMRC’s payroll (such as the end-of-year P60).
- Complete your annual financial statements.
- Complete your company’s tax return.
- Complete your individual tax return.
- Provide references for a mortgage or a tenancy
- Manage HMRC correspondence on a regular basis.
- Annually submit your Confirmation Statement
- Set up a bank account for your limited company on your behalf.
- If you supply professional services, conduct or facilitate IR35 contract evaluations.
If some of the above made your head spin, it’s not surprising. While most people have completed their own personal tax returns in the past, the taxes for a limited company are very different.
And it’s not just tax. There are an ever-increasing – and ever-changing – number of financial regulations governing almost every aspect of running a limited company that, if not met, can result in significant financial penalties (or worse.) Keeping up with them all isn’t easy, and it’s not something that the majority of limited company managing directors have the time, or the expertise, to handle.
An accountant for limited company, on the other hand, has both the time and expertise to do all of this and more. They can also provide the financial guidance that a new limited company needs in matters ranging from employee salary concerns to big corporate purchases and much more.
Why Work With Pearl Lemon Accountants?
If you decide to work with an accountant for a limited company, you’ll find you have lots of choices. So why work with Pearl Lemon Accountants? Not only are we great at what we do, and have the client testimonials to back that statement up, to us our clients are people, rather than just numbers in a system. Your business concerns become our business concerns, and we will be just as invested in your success as you are.
FAQs
Does an Ltd company need an accountant?
No, it is not a requirement for an Ltd company to have an accountant though it can be beneficial. They can take care of tax registrations for new companies.
Accountants can also make things easier for you at the end of the year as they can help complete your company’s tax return and ensure your annual accounts are in order.
For more information, book a call with our experts today!
How much do accountants charge for limited companies UK?
Accountants for limited companies tend to charge a monthly fee. The price varies based on what is included in the package you choose.
Can you prepare your own accounts for a limited company?
Absolutely. However, it might be a good thing to consider getting an accountant.
Since they know all of the requirements and legalities surrounding limited companies and tax documentation, they might be able to get you additional savings you never thought possible. Wouldn’t it be nice to know that your documentation was filed correctly?
If you would like more information, feel free to book a call with our experts!
Let’s Talk Accountancy.
Get in touch today, so we can discuss your accountancy needs,
your business, your hopes for the future and
just how Pearl Lemon Accountants can help you.