Hi Sian
Welcome to the madhouse!

Can you please pop your first name so that it appears on the signature bar under each post - via edit profile---> signature section.

Agree with Shaun that this is a question for your governing body, as failure to follow their rules can lead to some stringent sanctions.

The HMRC site states MLR is required for 'payroll agents that provide accountancy services and/or tax advice' be careful as the tax advice covers PAYE/NI kind of taxes in my book and also that of some of the governing bodies, although what Ive not done is drill down into HMRC to check that out further. Certainly if you do go it alone and consider this is not the case I would get a written ruling from HMRC as failure to comply can result in a whopping fine and at worst imprisonment - its really not worth it to save a bit of cash!

Obviously if your client is prepared to be your employer rather than a client then that is a different matter, but bear in mind by doing that they are carrying more cost in the business by having you on the books, but it does get round any potential IR35 issues given this is your only client.

On the Accountancy referral side that Shaun mentions - consider CIPP as a payroll qualification. Plus consider AAT as more widely accepted unless you are set with staying with the ICB for some reason.

edited to correct typos

Its not so expensive in the second year, its just the initial admin fee that makes it look that way in year one.

One of the prof bodies says on their website MLR MUST BE held for ''payroll agents if they provide accountancy services and/or tax advice - for example, if they calculate the tax liability, earnings or payments that are made to a business employees or subcontractors'', but like I said contact to HMRC is a good idea, but dont take the word for the agents who answer the phone. You will fast learn that they know very little and the information cannot be relied on in the event of an inspection/HMRC case against you, the only time this can be so is if you get the answer in black and white from them.

You will forgive the confussion but in the first post it did seem somewhat mixed up in that you mentioned ICB and accountancy in the same paragraph.

Being a student of accountancy bodies such as ACCA allow members to offer bookkeeping to trial balance, VAT and Payroll services but are otherwise very restrictive over what members are allowed to do. I'm not suggesting that you pursue ACCA just using their rules as an example.

AAT is a crossover qualification where people who attain MAAT MIP are considered to be accountants.

You need to determine exactly the services that you foresee eventually offering then look for the body / qualification most suitable to that end and then look at whether you would be allowed to practice payroll whilst training under than professional bodies rules.

The only way that anything that you do could be considered illegal is if you need MLR cover and do not have it. Everything else is being in breach of a professional bodies rules and regulations which they can fine you for under your membership of that body but has no actual basis in law.

The warning there is to be very careful that you have chosen the right professional body for you and understand their rules and regulations before becoming a part of them.

Take some time to consider AAT before deciding on anything higher or lower. You never know, if you do decide to move up to one of the higher accountancy qualifications AAT is very well considered where some others that claim equivalents are not recognised at all by the big boys.

I good measure to see how well a qualification is perceived is the enter into a Reed job search and see how many hits you get for the UK. (just did it for you. ICB came back with 7... AAT came back with 3,357... ACCA came back with 8,722).

Now, the arguement there is that ICB people are geared towards self employment... But so equally it can be argued are AAT one's.

Whichever way you go is completely your choice, just take your time over it and make your decision wisely as mistakes over choice of professional body can be costly to unwind.

Shaun

HMRC notice extract -

3.6 What types of businesses will be covered?

Businesses covered include:

• accountants
• auditors
• tax advisers
• book-keepers
• payroll agents
• tax consultants
• customs practitioners
• stock auditors
• interim managers undertaking any of the activities of the businesses listed above

unless you are already supervised by the FCA or a professional body listed in Section 8 of this notice for the purposes of the MLRs 2007.

3.21 What businesses providing payroll functions wont be within the scope of the MLRs as ASPs?
Businesses wont fall within the scope when they:

• provide software or hardware service support that enables the processing of payroll information providing they dont analyse or prepare financial information
• undertake payroll functions in relation to temporary workers they supply to or manage for a third party
• pay invoiced service fees to self-employed individuals, umbrella companies, partnerships or other corporate service providers
• are umbrella companies, managed service companies, or similar bodies and undertake payroll functions for employees working on assignments for end user clients
• provide recruitment or human resources management services (such as employment businesses supplying or managing temporary or contract workers) where payroll functions are incidentally undertaken as part of the providers overall business.

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Also, direct from gov.uk for needing to register for MLR

The services they provide can be recording, reviewing, analysing, calculating and reporting on financial information for other people. This includes:

• professional bookkeeping services
• accounts preparation and signing
• tax advice, for example:
  • help with completing and submitting tax returns or duty claims
  • advice on whether something is liable to a tax or duty
  • advice on the amount of tax or duty that is due

--------------------------------------------------------------------------------------

You would NOT fall under any of the above exclusions by undertaking the payroll.

You will at some point get into conversations about tax eg employment allowance.

You will be recording, reviewing, (possibly analysing), calculating and reporting on financial information for other people.  The tax and Ni is not calculated by your potential client.   (Also be aware that you should be ensuring as part of your duty of care that the staff are getting the correct pay - ensuring minimum wage and holidays are part of that process)

You will be completing and submitting the payroll tax returns as part of the payroll process under RTI ( I am assuming RTI was in full force when you had your own business - if not and you are not aware of it, shout out)

To get the definitive answer you have to have it in writing from HMRC or its not worth a jot. 

Out of interest - does your pal have software that you will use, or is this something her existing Accountant/Bookkeeper undertakes for her? What software will you be using?

Edited to sort the weird font formatting out (Still a bit odd!)

Good, you have experience of four year olds so you are now ready for the self employed... They may not be so well behaved, they will be prone to tantrums, do the opposit to what you tell them to and refuse to share anything (that includes invoices, receipts, bank statements)... Also, apparently we're not allowed to hit them .... Good news though, they pee themselves far less.... Although I believe that there have been some close calls on that one whilst I've been reviewing clients expenditure.

Specialisation is good but don't underestimate how crowded the market is or assume that everyone in business wants or needs a bookkeeper. Before you start consider from the outset whether you will ever make from it the amount that you will need to invest in training, insurance, professional memberships, software licences and advertising (trust me that many don't. The one's making the money are more often then not the one's selling the picks and shovels, not the one's digging for gold).

Never believe anything that anyone who is trying to sell you something tells you. No "professional" body or associated training company will attempt to tell you how much you may make or how many clients are crying out for your services, they will concentrate on how much you will learn. What you can make with that knowledge is down to you.

Good luck no matter which route that you take... But stay away from my Play Therapists or there will be drive by shootings ,

Shaun.

Shamus wrote:

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Taffygirl wrote:

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"Good, you have experience of four year olds so you are now ready for the self employed..."

I'm not sure they are so different to be honest

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Which surely was the whole basis of my joke.

Tut. I'm wasted on this audience.

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  I got it. Don't give up entertaining us, your funnies and Johns one liners keep us going, even if we are groaning at some of the jokes at the same time. 

I'm still taking "Some" rather than "All" as thunderous audience approval

Morning Joanne. The four year olds analogy has given me new inspiration for a business owner reeducation program :