Limited Companies guide for Contractors

Why a Company?

Whether you work direct for a Client or via an Agency you most likely will not be taken on direct but be asked to work via an intermediary, normally a Limited Company.  If you work direct on a self-employed basis then HM Revenue & Customs (HMRC) may try to classify you as an employee of your Client. This involves the Client in liabilities for Employer’s National Insurance and for you to be given employment rights of paid holidays, sick pay and pension rights. You have to also pay employee’s National Insurance. The Client would have to comply with employment law.

Clients avoid these liabilities by asking you to work via a Limited Company and you are compensated for your loss of employee benefits and rights by being paid a better rate.

Choosing a Company name

You may use any company name that is available, providing it is not currently being used and does not contain certain words that have to get special permission to be used in a company name. Contact us on 01702 710898 or at enquiries@cksonline.co.uk and we will check the availability of your chosen name.

What about IR35

IR35 refers to rules that were introduced in April 2000. Look here for our IR35 questions answered.

Setting up a Limited Company

We can set up a company for you. Call us for details today on 01702 710898 or email us at enquiries@cksonline.co.uk

How much does it cost?

We not only set up the Limited Company but also provide advice by telephone, email or face to face, look at your contract, register the company for Corporation Tax, PAYE and VAT, help you open a bank account and support you throughout the process of getting started as a contractor. Our charge for this is between £180 and £299. Call us on 01702 710898 for an exact quote.

How long does it take?

Incorporation only takes three to four hours from instructing us to go ahead to having the Limited Company ready to start trading. Opening the bank account and VAT registration takes less than one week.

Registered Office

Every company must have a Registered Office to which official documents from HMRC, Companies House, the Courts and others are sent. This can be your trading or home address but most clients choose our address to be the Registered Office address for their Limited Company. This facility is provided free to clients of CKS Accountancy Limited.

Officers

Every company has to have a least one director. You can also appoint a company secretary, but this is no longer mandatory. Directors are responsible for running the company.

Shares

Every company must issue at least one share but it is commonplace to issue 100 shares. Shareholders ultimately control what the company does, who is appointed officers and whether dividends are paid.

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It’s totally free, and gives you advice and guidance around setting up as a contractor or freelancer.