For those who are thinking of becoming a contractor, choosing an accountant to look after the tax affairs should be included on your first tasks that must be accomplished. Though, the question is, is there really a need of accountants for contractors?
Although there isn’t really any legal obligation to do so, here are some of the reasons why accountants for contractors are important.
Minimise the Risks of Errors
Being a contractor, that means you’re liable for the mistakes typically made during the preparation of accounts. With the guidance of a professional to look after these accounts would give you the assurance that the risk of committing errors would be lessened. Furthermore, a contractor accountant usually cost between £55-£110 per month. Likewise, the monthly cost of fixed fee accounts hasn’t changed a lot because of the competition between suppliers. That said, typical fixed fee rates for hiring contractors are lower than how much small business accountants usually charge.
More Time for Other Things
Truth be told, it will take several hours to evaluate your account each month. With the help of an account, you’ll be able to enjoy that time doing other important tasks instead.
Also, if you’ll look after your own accounts, there will be a need to complete several financial tasks annually. This includes paying and calculating the income tax, NICs, corporation tax, and VAT liabilities. A tax savings specialist accountant would also help you realise if there is any excess in your annual fees. Due to the fact that he has access to the latest changes happening in tax legislation, he’ll have the capacity to advise you accordingly.
Tax Affair Enquiries
In cases where the HMRC has inquiries in your tax affairs, then the account would be the one to deal with them on your behalf. A lot of people don’t know the importance of this, but it comes very handy in the long run.
Other Options to Consider
There’s plenty of accounting software available in the market– that’s why a lot of people think that managing your accounts has never been easier. Though, is it possible to compile and submit your annual company accounts through the use of this software? The answer is no.
An accountant would compile the company accounts as you take care of the rest of your tax affairs. Likewise, if you’ll ever have some questions or concerns that need clarifications, rest assured that a reliable accountant will enlighten your mind.
This is the main reason why a lot of contractors nowadays consider the use of an account. They’re very much aware that these professionals will make sure that their accounts are safe and up to date. A prime example of a qualified and experienced online accounting firm that provides their services for contractors is SME – Online Accountants.