Id like some words of wisdom please!!!! I am quoting a potential client doing: VAT Purchase Invoices Year End Bank Rec On a quarterly basis, with a tturnover up to 200k, what would you guys quote this out at, as im not sure.
If it is an owner managed company then they probably issue one invoice a month and have very few purchases. They could even be on flat rate for vat. Need to be wary of IR35 if you are doing final accounts. The bookkeeping is pretty easy and won't take a long time, I know of accountants who offer the whole service, vat return, payroll and year end from £75 per month at the really cheaper end, but often these people have been ripped off by umbrella companies so you may be able to levy a decent charge.
Thanks Rob, I just been reading up on the IR35, im a bit confused is this regards to me or the client. They are in fact a limited company where i would see then every quarter.
IR35 would potentially relate to your client if they area personal service company and have a long (think 2 years but Shaun will let you know) contract with the one client. Unless you are doing the year end accounts etc, then it is an issue for your client's accountant. Under IR35 the majority of the turnover (95%?) less a few other expenses like travel will be considered as 'deemed salary'. I was making the assumption earlier that the company was basically an owner managed co with just the one director/employee. If it's a bigger concern then probably not an issue, but I'm no expert!
Robs pretty much answered this one. For info, if the client is caught by IR35 then the following information will be of use to you.
Where the client is caught by IR35 then 5% of gross income is allowable. So, if the client has £200k input then £10k of that can be used for things like accountancy fees and training. If anything remains then that can be taken as a dividend.
the other 95%, in the example case around £190k has certain allowable expenses against it. These include :
Pension contributions Travel costs that would be allowable to an employee (such as mileage for use of a private car, parking and reimbursement of train fares). Hotel accommodation if home to work is unfeasible.
The above is not an exhaustive list but it's not far off.
Whatever remains after legitimate expenses have been deducted is deemed salary. It is NOT available for distribution as a dividend.
For travel expenses note that there is a two year rule and as soon as the contractor believes that the contract will last for more than two years all further travel and accommodation ceases to be an allowable expense.
One problem of course is that if after 12 months the contractor signs a contract that will last for another 12 month period then expenses stop immediately.
If a day before the 12 month period the contract is terminated the expenses of the period still remain as non claimable even though the total contract duration was for less then 24 months.
Ok, think that covers a consultant where IR35 is applicable.
Hope that this helps,
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Additionally, if this is an IR35 case then always remember that your fees need to come out of the 5%.
Sounds from your list as though your doing everything for the client but it's not complex.
Personally I pay my accountants £350 a year to do almost nothing. Worst rip off that I've heard of is £1500 to do the lot.
Assuming that it's as simple as I think it is maybe you could get away with up to £200 plus VAT per quarter? Have a look at the clients previous accounts and see what the last accountant was charging which should give you some guidance as to what you might be able to get away with.
Talk later,
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
The worst one I have heard of is £1000 for year end by an accountant. Everything was presented on excel spreadsheets, all neatly done by a memeber of his family, all receipts kept etc, all the accountant had to do was check it and then do the tax and file on line. Not even VAT reg, so hence he has now got a cheaper accountant, hes only a Sole trader, so he asked me if he was getting ripped off!!! I said it sounds like maybe but difficult to say for definate as I didn't do his books. But from the info I had I suggested he found someone closer to home for a start, and asked around about prices. Anyway hes got it half price now and was grateful for the tip!!!!
