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Contracting through your own limited company, with our help, is fairly straightforward. But it can sometimes be daunting at first, and I often get emails from clients confusing corporation tax, with self-assessment, or Annual Returns, and so on. So here's Part 1 of my guide to the basics :
Bookkeeping Spreadsheet - all of CEJ clients are given a very simple spreadsheet that you update as you send out invoices and incur expenses. This is where you provide us with almost all the information we need to keep you on track. It's held securely on a shared drive so that we can keep an eye on how you're doing, and can easily replace any formulas you accidentally delete! At the end of your company's financial year, we'll send you an email asking you to let us know when the spreadsheet is complete, and give you a link to a new bookkeeping spreadsheet for the new year. We'll then use your spreadsheet to prepare your annual accounts and corporation tax for approval.
Annual Company Accounts - this is your profit and loss, balance sheet and other financial information that we prepare at your year end, using the information you've given us in your bookkeeping spreadsheet. Amongst other things we'll check your expenses, work out the most tax efficient dividends you should declare, and compile a set of accounts that we then email to you for approval. Once you're happy with the figures, we'll submit them to Companies House on your behalf.
Corporation Tax - as part of the year end procedure, we'll calculate your corporation tax, which is the tax you pay on company profits. You have 9 months from your companies year end date to pay your corporation tax, so if your year end is 31st May, the corporation tax return must be submitted to HMRC and paid by 1st March the following year. Once you've approved your annual company accounts and corporation tax, we'll send you a payment link and instructions on how to pay the tax.
That complete's Part 1 of my 'Contracting Made Simple' guide. In Part 2 I'll cover Self Assessment, Annual Returns & Salary as a combination of PAYE & Dividends.
I hope you'll find these blogs useful, but if you have any questions at all, please email me at email@example.com. As a CEJ client, you are entitled to as much help and support as you need, and we always respond to emails within 24 working hours.
We also strongly recommend that you take a quick photo of any letters you receive from Companies House or HMRC, and email them over to us, just to help us provide you with the best support service we possibly can.