Questions about going self employed- what to include in a daily rate?

[SIMMO SAYS]

Be honest with the good folk at the tax office. I have been investigated 3 times and I am 99% straight. My accountant costs £300 a year to do my tax returns but I give him complete books. As you point out you don't get holiday or sick pay. There are also 9 bank holidays. Do you want/can you work them? Then vehichle, insurance, stationery, phone, internet, postage, advertising, tools, training......oh bloody hell anything you are going to have to pay for. You don't have to register for VAT until your turnover is over £80,000ish. Prob not worth becoming a limited company unless you turnover more than £50,000.

I have been SE for 25 years and could not bear going back to being employed. ENJOY!

YOU ARE ONE OF US
You missed out your other half washing your smalls

 

[melias shoes]

My yearly accounts cost around £500.00 ---but I do present him with all my in-goings/outgoings in several A4 boxes that I sort during the year.
This takes me a couple of hours a week x 1 year.

Yeah,youplumbers need accountants with the money you earn.:

 

[SIMMO SAYS]

Yeah,youplumbers need accountants with the money you earn.:

Don't kid yourself --- some of us are up shit creek without a paddle---I'm old school so don't rip people off.
Forty Years of doing Plumbing for the masses
Tonight I will spend at least 2 hours on the old computer doing bills/estimates & sending E Mails WTF!!!

 

[Pavilionaire]

As an accountant £300 p.a. for a simple sole trader, £500 p.a for a more complex sole trader are about right. £100 per month is normally what it would cost to be a director with your own limited company, and that would include accounts, corporation tax, payroll and personal tax.

It's interesting how people automatically think they're saving money by doing their accounts themselves, and what the preconceptions out there are about going limited. Going limited for some people can be beneficial once your profits are as low as c. £20,000, drawing a basic level salary and taking dividends can avoid unnecessary NI, registering VAT Flat Rate scheme can benefit some by £2K-£3K p.a. alone, then there's paying into pensions and getting higher rate relief too.

I've just taken on a sole trader who's business grew rapidly in 2014/15. His wife did his tax return. She missed the VAT registration threshold, missed out on claiming for a lot of business expenses. It cost the guy literally thousands in income tax, NI and sales he'll now have to pay back as VAT.

Do not underestimate the value of a good accountant. And while they're doing your accounts you can get on and earn money. HMRC are also less likely to investigate you if you have an accountant. And the costs of the fees are tax-deductible.

 

[nwgull]

Agree with the above about a good accountant. All the time you spend doing your own accounts, you could be put earning money. It's best to pay someone who knows what they're doing and can ensure that you're paying the appropriate amount in taxes and NI.

 

[desprateseagull]

Thanks for info - roles I've seen are all office based, no travel / equipment required..

 

[SIMMO SAYS]

Agree with the above about a good accountant. All the time you spend doing your own accounts, you could be put earning money. It's best to pay someone who knows what they're doing and can ensure that you're paying the appropriate amount in taxes and NI.

My Dad and now me have always employed an accountant since 1963 FFS!!!!!!!
Only one of them has been kidnapped
This information will register with anyone in their late fifties

Clue: Dutch sounding bloke.

 

[Soulman]

Had my accountant since 1992. I keep my receipts etc etc and put them in the book in order. My accountant charges £180 and he is a BHA ST holder.

 

[melias shoes]

Don't kid yourself --- some of us are up shit creek without a paddle---I'm old school so don't rip people off.
Forty Years of doing Plumbing for the masses
Tonight I will spend at least 2 hours on the old computer doing bills/estimates & sending E Mails WTF!!!

I was just joking with you simmo. I know exactly what the last few years have been like. I keep all my records too. Case of having too.

 

[surlyseagull]

A good accountant is worth their weight in gold and can save you a lot of money and is never money badly spent imo ,and like has been said it leaves you to be getting on with what you are good at as time is the most important commodity for yourself when running a business.
Obviously dont know what you are contemplating doing, but never underestimate the power of marketing ,you can be the best in the business with all the knowledge and all the best equipment ,but if nobody knows you or your business or what you do it wont count for anything.
Good luck .

 

[Cadiz Seagull]

Setting your prices based on your costs is not a good business practice. Not if you want to be profitable.

Why should someone pay your costs, what has it to do with them?.

The best way is to figure out what the customer will pay and set that as your price. Then work out your costs, does that leave you a decent margin?

If so, go for it. If it doesn't, can you reduce your costs?

If you can't, are you prepared to accept smaller margins? If not, don't do it.

A huge over simplification I know, and not easy to do, but nevertheless true. Start out with what the market will pay and figure out a way of providing that product or service at a cost that leaves you a reasonable profit.

Starting with your costs and adding a margin is tantamount to moving the target towards the arrow.

 

[OzMike]

Make sure you get a Jewish or a Pakistani accountant, best advise you will get.

 

[Charlies Shinpad]

Don't forget to claim £6.00 breakfast allowance if you leave home before 6.30am and also £14.50 lunch allowance if you work more than hours a day including travel !

 

[Justice]

Been looking at some jobs, that although will be regular hours, will be on S/Emp basis - no paid holidays, sick leave, bonuses etc..

I've always been employed on 'PAYE' before, so welcome some advice from you luvverly NSC'ers-

Say using a base rate of £100 a day (using national average wage of £26k, pro rata - 5 days a week, 52 weeks).. how much would you add on, to cover costs of doing accounts, health insurance etc? Oh, and VAT?

Not sure how anyone could (afford to) start from scratch into a job like this, having to wait two months before any money starts coming in..

Why is there no money for two months? out of interest.

 

[Marty McFly]

Why is there no money for two months? out of interest.

30 days working, then waiting 30 days for the invoice to be paid.

 

[Justice]

30 days working, then waiting 30 days for the invoice to be paid.

Only if those are your terms believe me if someone wants you or your goods badly enough they come up with the money quicker than that. I recently sold to a nursing home and they tried to hit me with that kind of scenario twenty minutes later the money was in my account.

 

[grubbyhands]

Don 't try and dick with the taxman, he'll get you in the end.Do an invoice for everything you sell and get a receipt for everything you buy. Get a good accountant and let him sort it out.Simples.