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Contractor accountancy services in Liverpool

People just setting up in business have several options for deciding the way in which they operate. Each option has its pros and cons and only after careful analysis can a considered opinion be put forward. As a contractor wanting to earn a living the tax advantages of each option will be of particular interest but there are other considerations too. Contractor accountancy services in Liverpool – one of the most populous cities in the UK and, therefore, a big player in business – can offer a detailed discussion on the range of options available and indicate which might be most appropriate.

Two popular vehicles for conducting a small business are the limited company and PAYE umbrella company. The limited company is the most tax-efficient way of conducting a business, as a wider variety of expenses can be claimed. The umbrella company is very simple to operate because payment can be forthcoming simply by submitting timesheets and expenses forms. All of the deductions are made at source, so the tax and NI contributions are deducted, leaving the business with a net payment and no more tax liability.

The limited company enables access the flat rate of VAT scheme. The owner also maintains total control of the business’ financial affairs, as they do not risk their business with any third party controller.

As the owner of a limited company, there is a certain amount of administrative work involved, which takes about 15 minutes a month. It can be expensive if somebody chooses contract through their company for a short time and then return to full time employment, as there are administrative formalities to perform, notably at Companies House. The umbrella company is better suited for someone taking on short-term contracts. However, they will receive a salary which is subject to income tax and NI contributions much like a permanent employee.

Wainwrights Ltd offers professional contractor accountancy services in Liverpool, and can help with the future of any small business in or around the city.