Limited company myths debunked

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For many contractors, setting up your own company is a must if you want to take your career to the next level. After learning the basics with an umbrella company, you might reach a point where you want to take on additional responsibilities in return for a greater reward.

However, there are a few common myths that could prevent all of you would-be company directors out there from making the leap to limited. To help, we’ve outlined some of the most popular misconceptions to separate fact from fiction.

It’s expensive to set up a company

If you decide to register your company direct with Companies House, it’ll cost you as little as £15. This online-only service usually takes 24 hours to complete. Postal applications might take a little longer, at around eight to ten days, and cost £40. If you want something speedier, but still want to go down the postal route, Companies House also offers a same-day postal service at a price of £100.

But before you rush to speak with Companies House, consider this. Although it seems like a quick and easy way of setting up your company, Companies House offers no additional assistance – something we know you might appreciate as a “newbie” company director. It’s therefore a good idea to approach a specialist contractor accountant that will be able to support you every step of the way.

The price of incorporation can vary – you’re looking at anything from £100 to £150 or more. But, if you do your research, you may be able to find a company that’ll do it for much less.

There’s too much paperwork

Yes, you’ll have more admin as a limited company than if you stick with the umbrella route. However, help is at hand. There are specialist contractor accountants out there to help relieve the burden. This leaves you free to concentrate on your assignments, safe in the knowledge that your obligations are taken care of.

A specialist accountant will offer you support every step of the way and issue reminders of important deadlines. What’s more, they also know all there is to know about IR35 and other legislation, helping you stay whiter than white with HMRC.

I’m too busy to visit an accountant

We, more than most, know that contractors have a busy WorkStyle and they might not have time to visit their accountant. That’s why a specialist accountant will normally provide access to a secure online platform.

You can use this facility to manage your account day or night at a time to suit you. If you’re a traditional type, some accountants also provide a telephony service giving you that personal approach.

Need more advice?

If you’re thinking about making the leap to limited, our sister firm ClearSky Contractor Accounting can help. ClearSky’s dedicated team of experts is with you all the way from incorporation to assisting with self-assessment tax returns and beyond.

ClearSky’s clever online portal and personal telephone service gives you the best of both worlds when managing your affairs. What’s more, the expert team will assist you with legislation such as IR35, so you can remain 100% compliant at all times.

Like us, ClearSky knows contractors inside out, meaning you can always trust them to be on your side whenever needed.

For more information, or to join ClearSky, please call 0800 458 0818 or email enquiry@clearskyaccounting.co.uk.

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