When do I need an accountant for my startup business?
When do I need an accountant for my startup business? You are starting a business because you have a brilliant idea which you want to commercialize. You should know that business is not only about ideas. You cannot succeed as a businessman if your targets are not achieved and the target of a business is to make profits. That is why you need an accountant – to maximize your profits. HOW EARLY SHOULD I HIRE AN ACCOUNTANT? It is a good idea to hire an accountant at the planning stage. I have encountered a number of entrepreneurs who were so excited about pursuing their idea and introducing it to the world that they didn’t bother about the numbers. You might have an innovative idea but you have to make sure the financial aspect of your business is covered as well. An accountant today is not only the bookkeeper, he can act as your financial advisor at the early stage of your business. For example, when you are planning your business you should know the financial feasibility of your project etc. An accountant can prepare a cash flow forecast for your business. A cashflow forecast tells you how much cash you will have after deducting all your expected expenses and costs. An accountant will not only prepare the forecast he can explain to you what the figures mean and the importance of the figures for your business. A cashflow forecast will tell you 2 important things: do you have enough money to pay to your suppliers and do you have enough funds and when and how much will you have to raise funds to keep your business running. Since the figures used in the cashflow forecast are an estimation there is an increased chance of an error. This is especially true for a startup business at the planning stage since the business is new and the estimation is based on the prediction and there are no previous figures to look at. This chance of error can be decreased when you have an accountant who has worked for a similar business. Your accountant can help you decide if you should run your business as a limited company, sole trader or a partnership. The structure you choose should be chosen wisely because it affects the taxes you pay and the way you report to HMRC. The fact is that the type of structure you choose to run your business depends on the individual circumstances. There’s no one answer to this even if you are in the same type of business. For example if you chose to run your business as a sole trader and you have personal assets as well on which you have to pay taxes you might end up paying more tax which could have saved if you were running your business as a limited company. An accountant makes sure that you utilize all the reliefs available to you so you can maximize your profits but reduce the tax costs. You will also need your accountant if you have to register for VAT. They can help you file your VAT returns, fill in the self assessment tax returns if you are a sole trader and file them on time, prepare your accounts, file your accounts and do all the necessary book keeping. If the returns are not filed on time and taxes are not paid on time you will have to bear unnecessary extra costs. If you are looking for a startup accountant in Croydon or a startup accountant in London call us 020 8127 0728. CTA Box See How Much You Can Save CALL NOW Take the stress out of UK taxes and accounting today — speak with a top-rated Taxaccolega chartered accountant for personalised advice tailored to your business or personal needs. Book a free Consultancy Related Posts ID Verification × ID Verification Form For Companies House From 18 November 2025, UK law will require all company Directors and Persons with Significant Control (PSCs) to verify their identity with Companies House. Companies House will issue a personal code to PSCs. Taxaccolega (ACSP) can help collect data and assist. Please answer the questions and upload documents. Personal Details Fornames * Last Name * Date of Birth *
4 reasons why you should incorporate your property business
4 reasons why you should incorporate your property business When we are in any kind of a business we are looking for ways to save taxes. Tax is a cost which cannot be avoided but there are ways to reduce the taxes we pay. For example, by choosing the right structure of our business we might be able to save taxes. There is no correct answer as to what the structure should be; it depends on your individual circumstances. In recent years there is an increased trend in incorporating the property business, by property business we mean buying the property to rent for business purposes. Why is incorporating becoming a popular choice of business structure. We have listed 5 reasons why you should incorporate your business: If you are in a property business there are 5 reasons why you should run it as a limited company 1. The Tax Rates The corporation tax rate for the company profits is 19% and this is less than the tax you pay on your personal income which is 20%, 40% and 25% depending on which tax band your income falls into However, there is no tax allowance available to the company profits which means that you have to pay taxes on all the profits that you make. Whereas, although the tax rates are high on the personal income there is a tax allowance available and you won’t have to pay any taxes when you earn upto £12, 570. This means that if you deduct all the expenses from your income and you are left with the profit of £12, 570 it would be worthwhile running the property business as self employed provided you don’t have any other income which uses your personal allowance. If you have your personal allowance already used up for example if you are doing a job or you have invested somewhere else as well you might want to incorporate your business to save taxes by paying tax at 19% 2. The Finance Cost The finance cost is the cost incurred which you pay when you borrow money to buy the property. In this case it will be the interest and other costs which you pay on the mortgage. You can deduct these costs when you are running the business as a corporation but these are not allowable expenses when you are self -employed. When these costs are deducted they will reduce your taxable profits and therefore the taxes that you will pay to HMRC. 3. Low rates of capital gains tax You pay capital gains tax when you are self-employed and you sell your assets such as your property. When you sell the property which is a residential property and it’s not your main home you will pay CGT at 18% or 28% depending on which tax band you fall into. If you are a limited company you will pay corporation tax(19%) on selling the property. 4. Maintaining your income If you have income from other sources as well you might want to restrict your income to save upon some personal taxes. If your property business is incorporated it is a separate entity and you can limit the income which you take from the company. You can take the income in the form of salary, dividend income and you can even take out the dividend loan. If you are thinking of starting a business or you a landlord and you want to incorporate your business do not hesitate to contact Taxaccolega, accountants in Croydon at 020 8127 0728 or message us here and we will be happy to help you CTA Box See How Much You Can Save CALL NOW Take the stress out of UK taxes and accounting today — speak with a top-rated Taxaccolega chartered accountant for personalised advice tailored to your business or personal needs. Book a free Consultancy Related Posts ID Verification × ID Verification Form For Companies House From 18 November 2025, UK law will require all company Directors and Persons with Significant Control (PSCs) to verify their identity with Companies House. Companies House will issue a personal code to PSCs. Taxaccolega (ACSP) can help collect data and assist. Please answer the questions and upload documents. Personal Details Fornames * Last Name * Date of Birth *
National Insurance- How much do I have to pay?
National Insurance How much do I have to pay? IS NATIONAL INSURANCE A TAX? You pay National Insurance to HMRC if you are above 16 years old and you are working as an employee earning a minimum of £ 183 per week. You will also have to pay National Insurance if you are self-employed and making a minimum profit of £ 6475 per year. If you are self employed making National Insurance contributions you will be entitled to certain benefits such as state pension, contribution-based Employment and support allowance, maternity allowance etc. However, they will not be able to claim Contribution based job seeker allowance. When you are employed, and you are working as an employee of the company the employer will deduct NI from the pay before you get the salary. When you are self employed you will have to pay NI when you are paying your income tax in your annual self -assessment tax return. You will continue to pay NI until you are the state pension age. There are different kinds of NI depending on the type of work you do: Class 1: If you are an employee and earning more than £ 183 per week, your employer will automatically deduct NI from your wages. Class 2: If you are self-employed and you are earning a profit of more than £ 6475 per annum you will pay NI in your self-assessment tax return. Class 3: You pay Class 3 NI when you are earning less than £ 6475 a year voluntarily. So that you do not have a gap in your NI contribution record. This can affect your State Pension as you need to have ‘Qualifying years’ to be eligible to get full state pension. Paying voluntary contributions is not that straight forward. You need to be eligible to pay voluntary contributions. Class 4: If you are Self employed and earning a minimum profit of £9501 per year. You will declare your total earnings in your self- assessment tax return and then HMRC will calculate the National Insurance that you have to pay. TAX ON COMPANY BENEFITS: You do not have to pay tax on the company benefits unless they are cash gifts or can be converted into cash. In that case they can be treated as earnings and you will have to pay tax on the value of the gift. The NI that your employer will pay on the company benefits that they give you are called Class 1A or 1B NI. NI THAT YOU MUST PAY IF YOU ARE BOTH EMPLOYED, AND SELF-EMPLOYED: In case you are both employed and self-employed, for example if you run a business as a limited company. You work as a director of the company and you get a salary from the company through PAYE. You will be paying Class 2 and Class 4 NI as part of your self-assessment depending on the level of your earning. You will also be deducting Class 1 NI from the wages, through PAYE. As the NI depends on the level of the earnings, you should be able to workout your total earnings from all the sources. This can be a little tricky and you might want to hire an accountant for that. We at Taxaccolega have accountants and Chartered accountants who not only do your numbers but also advise you on how to improve your numbers, maximising your profits and minimising your costs, including your tax costs. If you want to save money yet pay your taxes on time and in the most efficient way contact Taxaccolega at 020 8127 0728 and our expert accounting teams in Croydon, Surrey and Southall will be happy to help you. CTA Box See How Much You Can Save CALL NOW Take the stress out of UK taxes and accounting today — speak with a top-rated Taxaccolega chartered accountant for personalised advice tailored to your business or personal needs. Book a free Consultancy Related Posts ID Verification × ID Verification Form For Companies House From 18 November 2025, UK law will require all company Directors and Persons with Significant Control (PSCs) to verify their identity with Companies House. Companies House will issue a personal code to PSCs. Taxaccolega (ACSP) can help collect data and assist. Please answer the questions and upload documents. Personal Details Fornames * Last Name * Date of Birth *
Landlord National Insurance in the UK – What You Owe
I am a Landlord- How much NI will I have to pay? When you think of running a business it is very important that you know what costs may be involved so you have a fair idea of how much profits you will make. If you rent a property as a business, you must pay a certain amount to HMRC in the form of income tax and National Insurance. Renting a property is considered a business if all the following applies: If the above applies to you it means you must pay NI. If you are an accidental landlord that means you do not have to pay NI even if you advertise for renting out the property or get the repairs done. If you are running a business, you will be either running a business as a sole trader or you will be running as a limited company. IF YOU RUN A BUSINESS AS A SOLE TRADER: If you run a business as a sole trader, you will be paying NI with your self-assessment tax return if your profits for the year are £ 6475 or more. The type of NI you will pay is Class 2 NI. The tax rate for 2020/2021 is £ 3.05 per week. Most people pay their NI contributions through self-assessment. You are usually required to register yourself for self-assessment when you are earning more than £1000 per year. However, you can register voluntarily even if your profits are less and pay NI voluntarily just to make sure that you get full state pension – which requires a contribution of 35 years. You must note that the NI is paid when you reach a certain threshold for profits and not for the rent itself. To come to a profit figure, you have to deduct all the ‘allowable expenses’ from the rent that is paid to you. The allowable expenses will include all the costs involved in repairing, replacing and maintenance of the property. This will include repairing of water leaks, replacing of fixtures and fittings, repainting of walls. If you have hired some equipment to carry out the repair work, then you can deduct its cost from the rental income as well which will in turn reduce your taxable profit. If renting your property is your main business, you are most likely to have your unused personal allowance. For the year 2020/ 2021 the personal allowance is £12 500. Once you have calculated your rental profit by subtracting your allowable expenses from the rental income, you must subtract personal allowance from the rental profit. The remaining figure is your taxable profit. RUNNING A BUSINESS AS A LIMITED COMPANY If you are running a business as a limited company, and you are working as an employee you will be paying Class 1 NI through your PAYE system- Employees NI. We will cover that in detail in our next blog. We at Taxaccolega have an expert team of property accountants if you are looking for accountants in Croydon or accountants in South hall you should contact us at 020 8127 0728 and our expert team of accountants will be happy to help you. CTA Box See How Much You Can Save CALL NOW Take the stress out of UK taxes and accounting today — speak with a top-rated Taxaccolega chartered accountant for personalised advice tailored to your business or personal needs. Book a free Consultancy Related Posts ID Verification × ID Verification Form For Companies House From 18 November 2025, UK law will require all company Directors and Persons with Significant Control (PSCs) to verify their identity with Companies House. Companies House will issue a personal code to PSCs. Taxaccolega (ACSP) can help collect data and assist. Please answer the questions and upload documents. Personal Details Fornames * Last Name * Date of Birth *