Hi Me and frined are considering starting a small business (perhaps a food shop)
Hopefully in this sort of venture keeping records will be straightforward - what I want to know is what kind of jobs is the accountant usually paid to do? - keep end of year accounts, make sure you pay the correct tax?
Do you HAVE to have a Accountant to do certain tasks? Also wondering - if a company has 5 employees and they are paid 400 a week - how does the company pay their tax and NI? I understand the company pays their tax in a lump sum at the end of the year - is this when you would pay the employees for them (so in effect saving up laods of cash to give away?!?! :)
First make some sort of business plan to see if it really all adds up, you may have done this already, not sure. There are quite a few agencies who will help startups but don't get too involved with them or believe everything they say or you may end up in a morass of unhelpful (and unnecessary) bureaucracy.
You need to decide is whether it's going to be:- Sole trader (one of you will be the 'boss') Partnership (both of you, quite a lot of extra complexity) Ltd. company (not all that complex, some advantages, some disadvantages)
You also need to decide:- Are you going to VAT register, by the sound of the sort of size of business you are starting you will have to be. The turnover limit (above which you *have* to register) is 54k/annum at present I think, thereabouts anyway.
You can pay the accountant to do as much or as little as you want, if you want book-keeping done then it may well be more economical to employ someone (for a few hours a week maybe) to do that as opposed to accounting, accountants are expensive.
No, not any more, even for a Ltd. company. It may well be a good idea to have one for the annual returns and dealing with the Inland Revenue for you. FWIW I have an accountant for my two person Ltd. company, he deals with our tax returns (personal and company) and produces the Annual Return for Companies House. I do the PAYE/NIC monthly and deal with all the VAT returns. Our accountant costs about £700/year.
By PAYE, you fill in all the records on forms supplied by the Inland Revenue (or proprietary, approved, replacements, maybe using a computer based system) every time you pay your employees (including yourselves). If you pay weekly then you fill forms weekly, if you pay monthly then you do it monthly. Up to a certain level you can actually send the tax/NIC to the IR quarterly rather than monthly, with four employees I *think* you'd be under the limit for paying quarterly.
No, as I say above you have to pay tax/NIC at least quarterly and maybe monthly.
The more you do, the less they have to and the lower the bill. You should be able to cope with bookkeeping and possibly VAT.
No legal requirement to do so. However if you want the business to start off on the right track then it is advisable to seek their guidance, for instance whether to be a partnership or company, getting the books right from the start, whether to go VAT Flat Rate.
BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here.
All logos and trade names are the property of their respective owners.